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Held, further, W is entitled to relief under sec.
6015(c), I.R.C. The items giving rise to the
deficiencies (the disallowed partnership losses) are
properly attributed to H’s activities and partnership
interest. W did not have actual knowledge of the items
giving rise to the deficiencies at the time she signed
the tax returns. Under the standard enunciated by this
Court in King v. Commissioner, 116 T.C. 198 (2001), the
test for actual knowledge under sec. 6015(c)(3)(C),
I.R.C., is whether the requesting spouse had actual
knowledge of the facts resulting in the disallowance of
the losses. Contrary to respondent’s argument, the
King standard should be applied to both active and
passive activities. Therefore, petitioner is entitled
to relief from joint and several liability under sec.
6015(c), I.R.C.
Held, further, pursuant to sec. 6015(d)(3)(B),
I.R.C., W is not relieved of liability under sec.
6015(c), I.R.C., to the extent that she received a tax
benefit from the disallowed partnership losses claimed
on the joint returns.
Patricia M. Mora, f.k.a. Patricia Rasberry, pro se.
Lynn Rasberry, pro se.
Thomas M. Rohall and Kathryn K. Vetter, for respondent.
BEGHE, Judge: This case is before us on petitioner’s
“stand-alone” petition under section 6015(e)(1)1 for relief from
joint and several liability, following respondent’s denial of
relief. Intervenor is petitioner’s former spouse, who intervened
under section 6015(e)(4) and Rule 325. Intervenor and respondent
1Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years at issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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