Ruthe G. Ohrman - Page 24

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          held liable under section 6015(c)(1) may be increased as a result           
          of a transfer of disqualified assets under section 6015(c)(4).              
               Under section 6015(c)(4)(A), the portion of the deficiency             
          for which the taxpayer electing the application of section                  
          6015(c) is liable (without regard to section 6015(c)(4)(A)) is              
          increased by the value of any disqualified asset transferred to             
          the taxpayer.  The term “disqualified asset” means any property             
          or right to property transferred to the taxpayer making the                 
          election under section 6015(c) (i.e., petitioner) by the other              
          individual filing such joint return (i.e., Mr. Ohrman) if the               
          principal purpose of the transfer was the avoidance of tax or               
          payment of tax.  Sec. 6015(c)(4)(B)(i).                                     
               Under section 6015(c)(4)(B)(ii), there is a presumption that           
          any asset transfer that occurs after the date that is 1 year                
          before the first letter of proposed deficiency is sent by                   
          respondent has as its principal purpose the avoidance of tax or             
          payment of tax.  (The letter of proposed deficiency allows the              
          taxpayer an opportunity for administrative review in the Internal           
          Revenue Service Office of Appeals.  Sec. 6015(c)(4)(B)(ii)(I).)             
          This presumption, however, does not apply to any transfer made              
          pursuant to a decree of divorce or separate maintenance or a                
          written instrument incident to such a decree.  Sec.                         
          6015(c)(4)(B)(ii)(II); see also sec. 71(b)(2)(B) (explaining that           
          the term “divorce or separation instrument” means a written                 

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Last modified: May 25, 2011