David C. Jonson and Estate of Barbara J. Jonson, Deceased - Page 22

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               Whether it is inequitable to hold a spouse liable for a                
          deficiency is determined “taking into account all the facts and             
          circumstances”.  Sec. 6015(b)(1)(D).  Most often cited as                   
          material factors to be considered are (1) whether there has been            
          a significant benefit to the spouse claiming relief, and                    
          (2) whether the failure to report the correct tax liability on              
          the joint return results from concealment, overreaching, or any             
          other wrongdoing on the part of the other spouse.  See, e.g.,               
          Hayman v. Commissioner, 992 F.2d at 1262.  Normal support is not            
          considered a significant benefit.  Id.                                      
               As noted in connection with our discussion of the                      
          application, to Barbara, of the lack of knowledge requirement of            
          section 6015(b)(1)(C), it is clear that the tax savings were                
          immensely beneficial to both David and Barbara, in that the                 
          savings contributed to their ability to pay for their children’s            
          college educations and still maintain their standard of living.             
          In Barbara’s own words, the tax savings enabled her and David “to           
          make ends meet”.  Without the tax savings generated by the Vulcan           
          investment, David and Barbara would not have had a sufficient               
          cashflow to cover their family expenditures, including their                
          children’s educations.                                                      
               It is also clear that there was no “concealment” on David’s            
          part.  As noted supra p. 20, Barbara had access to David’s files            
          and to his office, and he never tried to deceive her with respect           

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Last modified: May 25, 2011