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Commissioner has no duty to investigate a third-party information
return that is not disputed by the taxpayer). We are also unable
to conclude, on the basis of the record, that petitioner has
fully cooperated with respondent. A failure to cooperate would
also seem to render section 7491(a) inapplicable. Petitioner
asserted frivolous arguments to the IRS through numerous
submissions, all of which relied on erroneous information. The
IRS informed petitioner that his claims were groundless, but
instead of remitting the tax he owed, petitioner decided to
embark on this painstaking journey.
II. Exemptions and Deductions
A. Exemptions
Petitioner claimed two personal exemptions, one for himself
and one for his wife, and a dependency exemption for his
daughter. Respondent permitted the exemptions for petitioner and
his daughter but disallowed the exemption for his wife.
The pertinent part of section 151(b) provides a taxpayer
with an exemption for a spouse if the taxpayer and the spouse do
not file a joint return, and the spouse had no gross income and
is not dependent on another taxpayer during the calendar year in
which the taxpayer’s tax year began. Any income the taxpayer’s
spouse received during the applicable tax year precludes the
taxpayer from taking an additional personal exemption. See sec.
1.151-1(b), Income Tax Regs.
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