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In analyzing relief from joint liability under section
6015(c), items are generally allocated as if petitioner and Mr.
Rowe had filed separate returns. Sec. 6015(d)(3)(A). The first
principle of income taxation is that income must be taxed to him
who earns it. Commissioner v. Culbertson, 337 U.S. 733, 739-740
(1949); Schuster v. Commissioner, 84 T.C. 764, 773 (1985), affd.
800 F.2d 672 (7th Cir. 1986). Married individuals filing
separate returns are required to report their own income.
Charlton v. Commissioner, T.C. Memo. 2001-76.
Petitioner testified that before 1995 she was not aware of
any retirement accounts or plans established in her name. She
could not recall signing any papers to open a retirement account,
authorizing withdrawals, signing distribution checks, or
receiving any funds from a retirement account. Mr. Rowe
testified that he personally established the retirement account
and that he could have opened it in petitioner’s name without her
knowledge. Mr. Rowe also testified that he believed funds were
borrowed from the account, but that he did not consult petitioner
regarding the loan. Mr. Rowe further testified that he provided
no information to petitioner regarding retirement planning.
The process of distilling truth from falsehood from the
testimony of witnesses, whose demeanor and credibility we
observe, is the daily grist of judicial life. Diaz v.
Commissioner, 58 T.C. 560, 564 (1972). After watching petitioner
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