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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
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