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Rev. Proc. 2000-15, sec. 4.02, 2000-1 C.B. at 448, describes
the circumstances under which the Commissioner will “ordinarily”
grant 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.
Respondent acknowledges that petitioner satisfies the first
requirement, but argues that petitioner does not qualify for
relief under sec. 4.02 of the revenue procedure because she: (1)
Knew or had reason to know that the liabilities reported on the
joint returns for 1995 through 1997 would not be paid at the
times that she signed those returns; and (2) has not demonstrated
that she would suffer economic hardship if relief is not granted.
We agree with respondent on both points.
Although petitioner did not participate in the family
farming operation, she was aware of the family’s financial
situation. She was aware that her former spouse was having
trouble satisfying his then-current financial obligations when
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