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equitable relief in cases where a liability reported on a joint
return is unpaid. These elements are:
(a) At the time relief is requested, the
requesting spouse is no longer married to, or is
legally separated from, the nonrequesting spouse * * *;
(b) At the time the return was signed, the
requesting spouse had no knowledge or reason to know
that the tax would not be paid. The requesting spouse
must establish that it was reasonable for the
requesting spouse to believe that the nonrequesting
spouse would pay the reported liability. * * *; and
(c) The requesting spouse will suffer economic
hardship if relief is not granted. * * *
Rev. Proc. 2000-15, sec. 4.02(1), 2000-1 C.B. at 448. The
Commissioner will grant equitable relief to the extent that the
unpaid liability is allocable to the nonrequesting spouse only if
all three elements of Rev. Proc. 2000-15, sec. 4.02, 2000-1 C.B.
at 448, are satisfied. Rev. Proc. 2000-15, sec. 4.02(1), (2)(b),
2000-1 C.B. at 448.
Respondent concedes that petitioner satisfies the first and
third elements of Rev. Proc. 2000-15, sec. 4.02, 2000-1 C.B. at
448. With respect to the second element of Rev. Proc. 2000-15,
sec. 4.02, 2000-1 C.B. at 448, however, respondent contends that
petitioner knew or had reason to know that the liabilities
reported on the joint returns for 1992 through 1995 would not be
paid at the times that she signed those returns. As discussed
below, we agree with respondent’s contention.
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