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Petitioner filed a timely petition in this Court appealing the
Appeals officer’s decision. On March 31, 2004, intervenor filed
a timely Notice of Intervention.
The Court must decide whether petitioner is entitled to
relief from joint liability in lieu of the Appeals officer’s
determination. Where the underlying tax liability is properly at
issue before the Appeals officer, this Court reviews that issue
on a de novo basis. Goza v. Commissioner, 114 T.C. 176, 181-182
(2000). However, where the underlying tax liability is not at
issue, as in this case, this Court reviews the determination on
the basis of whether there was an abuse of discretion by
respondent. Sego v. Commissioner, 114 T.C. 604 (2000). An abuse
of discretion is defined as any action that is unreasonable,
arbitrary or capricious, clearly unlawful, or lacking sound basis
in law, taking into account all the facts and circumstances.
E.g., Thor Power Tool Co. v. Commissioner, 439 U.S. 522, 532-533
(1979); Swanson v. Commissioner, 121 T.C. 111, 119 (2003).
Married persons who file a joint Federal income tax return
generally are jointly and severally liable for the payment of the
tax shown on the return or found to be owing. Sec. 6013(d)(3);
Cheshire v. Commissioner, 115 T.C. 183, 188 (2000), affd. 282
F.3d 326 (5th Cir. 2002). Furthermore, agreements between
spouses with respect to how liability is shared on tax
deficiencies are not binding on this Court. Pesch v.
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