- 14 - to know about Mr. Lathrop’s unemployment compensation or nonemployee compensation for the year at issue. As discussed earlier, petitioner had actual knowledge of Mr. Lathrop’s unemployment and nonemployee compensation. Petitioner’s actual knowledge is a strong factor weighing against relief, which can be overcome only if the factors in favor of equitable relief are particularly compelling. Petitioner contends in her petition to this Court that she would experience economic hardship if she were forced to pay the tax liability for the year at issue. A taxpayer might experience economic hardship if he or she were unable to pay basic reasonable living expenses. Sec. 301.6343-1(b)(4)(i), Proced. & Admin. Regs. It is the taxpayer’s burden to show both that the expenses qualify and that they are reasonable. Monsour v. Commissioner, T.C. Memo. 2004-190. Despite her assertion that paying the tax liability would cause her to experience economic hardship, petitioner provided no evidence at trial that she would be unable to pay basic living expenses if she were held liable for the deficiency. The Court fails to see, and petitioner has not established, that she would suffer economic hardship if her request for relief from joint liability were denied. This factor weighs against granting petitioner relief. On the basis of the facts and circumstances in this case, including the factors set forth in Rev. Proc. 2000-15, supra, thePage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011