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reasonable for petitioner to believe Mr. Barrera would pay the
reported liabilities at the times she signed the returns. The
record shows that when petitioner signed the joint returns for
taxable years 1998, 1999, and 2000 on May 23, 2000, November 2,
2000, and July 24, 2001, respectively, she was well aware of the
financial difficulties facing her family. Mr. Barrera’s mortgage
brokerage business had, in petitioner’s words, “failed” in 1998
as a result of a Federal criminal investigation, and Mr. Barrera,
the sole earner in the family at that time, lost the necessary
mortgage licenses to continue with that line of work.
Thereafter, in late 1999, petitioner and Mr. Barrera put their
“fabulous” Pine Bay Estates house on the market and, after its
eventual sale a year later in October 2000, purchased the less
expensive “mediocre” West Kendall house. Petitioner was “sick to
sell” the Pine Bay Estates house and was not “a happy party” to
its sale, and she admitted that, when the Pine Bay Estates house
had to be sold, she knew there were financial problems facing her
family. Petitioner further testified that by 2000, Mr. Barrera
was working “less and less” at his successor home improvement
loan business, and when he quit renting commercial office space
for the business and moved the office into their home, petitioner
realized that Mr. Barrera could no longer pay the rent for the
commercial office space. Petitioner testified that she also knew
by 2000 that she had to agree to Mr. Barrera’s repeated requests
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