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periodic financial statements in her name were sent to her
address, and petitioner herself testified that she usually picked
up the mail and opened the letters addressed to her.
Section 6015(d)(3)(A) provides that, generally, an item
giving rise to a deficiency on a joint return is allocated
between the electing spouse and the former spouse in the same
manner as it would have been allocated if they had filed separate
returns for the taxable year. Additionally, the legislative
history of section 6015(c) indicates that this type of income
item is expected generally to be allocated on the basis of the
source of the income and the ownership of the item giving rise to
the income. S. Rept. 105-174, at 56 (1998), 1998-3 C.B. 537,
592. Petitioner bore the burden of establishing the allocation
of this item under section 6015(c), and, largely on the basis of
her testimony at trial, we found that petitioner established that
the item was allocable to Mr. Rowe. However, on the basis of the
facts known to respondent and the relevant legal precedent, we
believe that respondent had a reasonable basis in both law and
fact for arguing that this item was allocable to petitioner and
she was not entitled to relief under section 6015(c).
b. Capital Gains
In 1987 and 1988, properties that were jointly titled in
petitioner’s and Mr. Rowe’s names were sold. The checks
representing the proceeds of the sales were issued payable to
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