Charma Gatlin Cook - Page 7

                                        - 7 -                                         
          Cir. 2002), affg. 115 T.C. 183, 195 (2000).  In various                     
          circumstances, we have found that the information available to a            
          taxpayer as to the source of income was insufficient to supply              
          her with actual knowledge of the item of omitted income.  See,              
          e.g., Charlton v. Commissioner, 114 T.C. 333, 341 (2000); Rowe v.           
          Commissioner, T.C. Memo. 2001-325; Martin v. Commissioner, T.C.             
          Memo. 2000-346.  Indeed, the Secretary of the Treasury, in his              
          regulations interpreting section 6015, has drawn the same                   
          distinction between reason to know and actual knowledge.  See               
          sec. 1.6015-3(c)(2)(iii), Income Tax Regs. (“Knowledge of the               
          source of an erroneous item of income is not sufficient to                  
          establish actual knowledge.”).  The effective date of those                 
          regulations, however, precludes their application to this case.             
          Sec. 1.6015-9, Income Tax Regs. (applicable for elections under             
          section 1.6015-3, Income Tax Regs., filed on or after July 18,              
          2002).                                                                      
               To demonstrate petitioner’s knowledge of Mr. Spruill’s                 
          receipt of the omitted item of business income (the Thunder Alley           
          receipts), respondent proposes two findings of fact:  (1)                   
          Petitioner prepared the invoices for Mr. Spruill’s business and             
          the monthly summary of those invoices, and (2) she had knowledge            
          of the billings specifically corresponding to the Thunder Alley             
          receipts.  While we have made a finding equivalent to                       
          respondent’s first proposed finding of fact, and respondent’s               






Page:  Previous  1  2  3  4  5  6  7  8  9  Next

Last modified: May 25, 2011