Debra Anne Banderas - Page 18
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situations where moneys were thought to be available at the time
the relevant return was signed and filed.6
The foregoing conclusion is consistent with the result
reached by this Court in other contexts involving factual
contingencies regarding source of payment. In Vuxta v.
Commissioner, T.C. Memo. 2004-84, the Court addressed a
taxpayer’s request for relief under section 6015(f) for 1989,
1990, and 1991. The underlying returns showing balances due had
been filed on September 17, 1990, September 23, 1991, and May 30,
1996, respectively. The taxpayer and her husband had filed for
6 Placement of the modifying prepositional phrase (“On the
date the requesting spouse signed the joint return”) in the text
of Rev. Proc. 2003-61, sec. 4.02(1)(b), 2003-2 C.B. 296, 298,
would not appear to be conclusive on this issue. While the
Court’s placement of the phrase has varied, certain paraphrases
of the standard are amenable to a reading that could require a
belief that actual payment of the taxes would occur with the
filing of the return. E.g., Merendino v. Commissioner, T.C.
Memo. 2006-2 (“The relevant knowledge in the case of a reported
but unpaid liability is that the tax would not be paid when the
return was signed.”). The legislative history of the provision
might be open to a similar reading, in that the example supplied
indicates Congress intended for equitable relief to be granted
where a requesting spouse “does not know, and had no reason to
know, that funds intended for the payment of tax were instead
taken by the other spouse for such other spouse’s benefit.” H.
Conf. Rept. 105-599, at 254 (1998), 1998-3 C.B. 1008. Again,
however, the Court need not decide here whether such usages or
examples operate as limitations.
Additionally, guidelines set forth in the Internal Revenue
Manual (IRM) could suggest a more liberal reading, stating: “A
belief the tax would be paid is not reasonable if the RS
[requesting spouse] knew or had reason to know the NRS
[nonrequesting spouse] was not in an economic position, and was
not expected to be in an economic position within the foreseeable
future, to pay those taxes.” IRM sec. 126.96.36.199.3.2(2).
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Last modified: November 10, 2007