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individual under section 6015(d)(3) bears to the net amount of
all items taken into account in computing the deficiency. Sec.
6015(d)(1). Section 6015(d)(3)(A) provides that items giving
rise to a deficiency on a joint return (erroneous items) shall be
allocated to each spouse as though each had filed a separate
return for the taxable year; i.e., an erroneous item is allocated
to the spouse to whom the erroneous item is attributed. The
requesting spouse is liable only for his/her proportionate share
of the deficiency; i.e., the amount that bears the same ratio to
the deficiency as the net amount of erroneous items allocable to
the electing spouse bears to the net amount of all erroneous
items. Sec. 6015(d)(1), (3)(A); sec. 1.6015-3(d)(4)(A), Income
Tax Regs.
1. Allocation of Erroneous Items
The parties agree that the Form 4797 loss and the theft loss
are “erroneous items” that are attributable equally to Mr.
Capehart and petitioner; i.e., had petitioner and Mr. Capehart
filed separate returns, they would each have reported one-half of
the losses on their respective separate returns. See sec.
1.6015-3(d)(2)(iv), Income Tax Regs.
The parties’ computations reveal that petitioners are not
entitled to any deduction for medical or dental expenses.
Petitioner and Mr. Capehart reported total medical/dental
expenses of $3,280 and deducted $1,143 on the joint return on
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Last modified: May 25, 2011