Shuang-Di Sun Bennett - Page 12

                                       - 11 -                                         
          opportunity to challenge her tax liability before her                       
          administrative hearing, we review petitioner’s underlying tax               
          liability de novo.                                                          
               In a trial de novo, our findings and conclusions concerning            
          a taxpayer’s liability must be based on the merits of a case                
          without deference to the determination reached at the                       
          administrative level.  See Ewing v. Commissioner, 122 T.C. 32,              
          37-38 (2004); Jones v. Commissioner, 97 T.C. 7, 18 (1991).                  
          Although petitioner resided in a community property State and               
          filed her return as “married filing separate”, respondent did not           
          determine or assess a tax based upon petitioner’s share of                  
          community income and, consequently, there was no consideration of           
          the issue in the notice of determination.  Since our task in a              
          trial de novo is to arrive at a conclusion of the correct amount            
          of a taxpayer’s underlying tax liability, we apply Federal income           
          tax principles as they relate to the taxpayer’s share of                    
          community income.                                                           
          II.  De Novo Review of Petitioner’s Underlying Tax Liability                
               A.  Community Property--General Rules                                  
               Generally, a spouse residing in a community property State             
          has a vested interest in and is owner of one-half of both                   
          spouses’ community property.  United States v. Mitchell, 403 U.S.           
          190, 196 (1971).  California law defines community property as              
          all property, real or personal, wherever situated, acquired by a            

Page:  Previous  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  Next

Last modified: May 25, 2011