- 11 -
paid at the time the return was filed; however, the Court
disagrees. In essence, respondent contends that, notwithstanding
the absence of factors to intimate financial infidelity on the
part of Ms. Peet, petitioner should have known that the money he
designated for the 2000 tax liability was instead siphoned into a
private account in her name. There is nothing in the record to
indicate that petitioner had reason to suspect the financial
deception from Ms. Peet that gave rise to the underpayment of tax
for 2000. The Court, thus, finds that petitioner did not know or
have reason to know that the tax liability for 2000 would not be
paid at the time the return was filed.
Rev. Proc. 2000-15, sec. 4.03(1)(e), 2000-1 C.B. at 449,
considers whether the nonrequesting spouse had a legal obligation
pursuant to a divorce decree or other agreement to pay the
liability for which relief is sought. According to the terms of
the divorce decree, Ms. Peet was obligated to pay $7,508.08 for
her share of the tax liability for 2000 and $1,462.50 for her
portion of the tax liability for 2001.10 This factor supports
granting relief to petitioner because, by making continued
payments on his installment agreements, he paid in excess of what
10The return for 2001 reflected an underpayment of tax in
the amount of $5,850. Because Ms. Peet was liable under the
divorce decree for one-fourth of the reported tax liability for
2001, she is obligated to pay $1,462.50 of the total liability
for that year.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Next
Last modified: May 25, 2011