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In our opinion, the extreme facts and circumstances presented
represent just such a situation envisioned by Congress.
2. Actual Knowledge
Respondent argues that even if this item were allocable to
Mr. Rowe, petitioner still had actual knowledge and reason to
know of the item because she testified that she sorted the mail
and opened letters addressed to her. Respondent claims that
petitioner must have known about the IRA because periodic
statements from the financial institution managing the account
were addressed to her individually at her home address.
As we mentioned earlier, petitioner credibly testified that
before 1995 she was not aware of the existence of any retirement
accounts or plans in her name. Petitioner testified that she
usually collected the mail, but that she never saw any letters
notifying her of the existence of the IRA or the distributions.
Mr. Rowe testified that sometimes he picked up the mail, and
petitioners’ son, Christopher, testified that whoever got home
first would pick up the mail. Additionally, Mr. Rowe testified
that he provided petitioner with no information regarding
retirement planning. Whether petitioner had an actual and clear
awareness of the omitted income is an essential fact respondent
is required to establish under section 6015(c)(3)(C). Respondent
has failed to establish this fact. Accordingly, we hold that
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