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(A) a joint return has been made for a
taxable year;
(B) on such return there is an
understatement of tax attributable to erroneous
items of one individual filing the joint return;
(C) the other individual filing the joint
return establishes that in signing the return he
or she did not know, and had no reason to know,
that there was such understatement;
(D) taking into account all the facts and
circumstances, it is inequitable to hold the other
individual liable for the deficiency in tax for
such taxable year attributable to such
understatement; and
(E) the other individual elects * * * the
benefits of this subsection not later than the
date which is 2 years after the date the Secretary
has begun collection activities with respect to
the individual making the election * * *.
Because these requirements are stated in the conjunctive, a
requesting spouse must satisfy each requirement to be relieved of
joint and several liability under section 6015(b). Alt v.
Commissioner, supra at 313. It is agreed that Ms. McClelland met
three of the five requirements: section 6015(b)(1)(A), (B), and
(E). Thus, we shall only address the requirements in section
6015(b)(1)(C) and (D).3
3 The Treasury regulations under sec. 6015 do not apply to
the 1997 tax liability in this case because Ms. McClelland’s
claim for innocent spouse relief was filed before the
regulations’ effective date. Sec. 1.6015-9, Income Tax Regs.
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Last modified: May 25, 2011