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known that further payments were required to satisfy each year’s
liability. The administrative record indicates that petitioner
knew that her husband was not having enough tax withheld, was
claiming extra exemptions, and was using the money to support his
drinking problem. In written responses to the revenue agents’
questions, petitioner stated that Mr. Foor frequently lost jobs
and was in trouble for alcohol-related incidents, he made false
deposits in their joint checking account to obtain money from the
bank, and petitioner did not have enough money to pay the bills.
Petitioner’s allegations indicate that she lacked the funds
necessary to pay the tax liabilities and that she was aware that
Mr. Foor’s financial situation was the same or worse. We believe
that the revenue agents could reasonably have concluded that
petitioner had reason to know that the taxes would not be paid at
the time she signed the returns.
Our finding above precludes relief under Rev. Proc. 2000-15,
sec. 4.02. However, with respect to Rev. Proc. 2000-15, sec.
4.03, petitioner’s reason to know is the only negative factor
that respondent specifically argues on brief justifies the denial
of equitable relief. Although this is a strong factor weighing
against relief, it is not determinative. Washington v.
Commissioner, 120 T.C. at 150-151; Rev. Proc. 2000-15, sec.
4.03(1)(d), 2000-1 C.B. at 449. Respondent admits that petitioner
is divorced, will suffer economic hardship if relief is not
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