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prevail, the taxpayer must demonstrate that in not granting
relief, the Commissioner exercised his discretion arbitrarily,
capriciously, or without sound basis in fact or law. Woodral v.
Commissioner, 112 T.C. 19, 23 (1999); Mailman v. Commissioner, 91
T.C. 1079, 1082-1084 (1988).
Because petitioner is entitled to section 6015(c) relief
with respect to the charitable contribution deductions, she is
not eligible for equitable relief with respect to the resulting
deficiencies. Sec. 6015(f)(2). We therefore only address
equitable relief with respect to the rental loss deductions.
As directed by section 6015(f), respondent has prescribed
procedures in Revenue Procedure 2000-15, 2000-1 C.B. 447, that
the Commissioner will consider in determining whether an
individual qualifies for relief under that section. Section 4.03
of the revenue procedure lists several nonexclusive factors to be
considered in determining eligibility for relief. In denying
equitable relief, respondent most heavily relied upon two of
these factors--petitioner’s knowledge of the facts underlying the
rental of the condominium unit to her daughter, and petitioner’s
receipt of a significant benefit from the understatement of tax.
As discussed above, petitioner had full knowledge of the
underlying facts concerning the rental of the condominium unit.
Furthermore, she made no effort to review the tax returns or
otherwise verify their accuracy prior to signing them. She
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