Russell Whiting Packer - Page 8

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              Petitioner and Ms. Valentine were divorced on July 27, 2000,            
         and petitioner’s election for innocent spouse relief was made                
         shortly after his receipt of the statutory notice of deficiency.             
         Therefore, petitioner is eligible to elect the application of                
         section 6015(c).                                                             
              Relief under section 6015(c), however, is not available if              
         respondent demonstrates that the requesting spouse had actual                
         knowledge, at the time the return was signed, of any item giving             
         rise to a deficiency (or portion thereof) that is not allocable              
         to such individual.  Sec. 6015(c)(3)(C); Hopkins v. Commissioner,            
         121 T.C. 73, 86 (2003); Cheshire v. Commissioner, supra at 193-              
         194.  The knowledge requirement under section 6015(c)(3)(C) does             
         not require the requesting spouse to possess actual knowledge of             
         the tax consequences arising from the item giving rise to the                
         deficiency.  Hopkins v. Commissioner, supra; Cheshire v.                     
         Commissioner, supra at 194; sec. 1.6015-3(c)(2), Income Tax Regs.            
         Rather, the statute mandates only a showing that the requesting              
         spouse actually knew of the item on the return that gave rise to             
         the deficiency (or portion thereof), without regard as to whether            
         he knew of the tax consequences.  Mitchell v. Commissioner, supra            
         at 805; Cheshire v. Commissioner, supra.                                     
              The item giving rise to the deficiency is the distribution.             
         At the time when the distribution was made, petitioner signed a              
         spousal consent, which evidenced that he knew and consented to               

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