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sec. 4.02(1)(b). Accordingly, we must consider whether, “taking
into account all the facts and circumstances”, sec. 6015(f)(1),
petitioner knew or had reason to know that intervenor would not
pay the taxes on intervenor’s self-employment income shown as due
on the tax returns for the taxable years in issue.
Petitioner contends that she had no knowledge that any of
the unpaid joint tax liabilities would not be paid by intervenor.
Petitioner did know that there were income taxes due for each of
the taxable years in issue when she signed each tax return.
However, petitioner testified that “[Intervenor] said that he
would take care of the [taxes] due, as my taxes were taken out of
my paycheck and none were taken out of his. And he did pay the
taxes. He paid the taxes for most of the years.” Having
observed petitioner’s appearance and demeanor at trial, we find
her testimony to be honest, forthright, and credible. In
addition, petitioner’s testimony is corroborated by the fact that
intervenor did generally pay the tax balances due as a result of
intervenor’s self-employment income as reported on the couple’s
jointly filed income tax returns. Accordingly, we conclude that
petitioner had no knowledge that intervenor would not pay the
taxes due on the tax returns filed for the taxable years in
issue.
Petitioner likewise contends that she had no reason to know
that intervenor would not pay those tax liabilities. Petitioner
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