- 13 - signed. Wiest v. Commissioner, T.C. Memo. 2003-91 (citing Notice 98-61, sec. 3.03(2)(b), 1998-2 C.B. 756, 757); see also Rev. Proc. 2000-15, sec. 4.03(1)(d), 2000-1 C.B. at 449. Petitioner contends that she did not know or did not have reason to know that the liability would not be paid. Petitioner asserted in documentation submitted to the Appeals Office that she expected the tax liability would be paid out of the sale of Dr. Merendino’s business and that although a portion of the outstanding liability was attributable to her, Dr. Merendino had always paid the tax liabilities in previous years and she expected him to do so again for the 1996 liability. At trial, petitioner testified that she believed the funds to pay the tax liability would come from the sale of Dr. Merendino’s business and from the overpayment of $400,000 that Dr. Merendino made for a previous year. Petitioner further stated that she relied on Dr. Merendino to file the return and pay the taxes. Petitioner’s reasons for believing that the tax liability would be paid are not credible. The return was filed in December 1998. It was not reasonable for petitioner to rely on the funds from the sale of Dr. Merendino’s business to pay for the tax liability by the time the return was filed. The settlement of the lawsuits against Dr. Merendino’s business occurred on JunePage: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Next
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