Cheryl Kunsman - Page 15

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          to pay her reasonable living expenses.  Such substantiation was             
          particularly necessary in light of petitioner’s assertion that              
          her expenses already exceed her income by more than 50 percent              
          each month.                                                                 
               Petitioner failed to demonstrate that she will be unable to            
          pay reasonable basic living expenses if relief is denied.  We               
          hold that respondent did not abuse his discretion in concluding             
          that petitioner would not suffer economic hardship and that this            
          factor weighs against relief.                                               
               3.  Knowledge or reason to know:  Petitioner claims                    
          ignorance of the IRA distribution.  The distribution was clearly            
          shown on the joint tax return.  The deficiency results from the             
          failure to report the section 72(t) additional tax.  We have                
          previously held that petitioner had actual knowledge not only of            
          the IRA distribution but also of the liability for additional tax           
          on an early distribution.  This factor weighs against relief.               
               4.  Nonrequesting spouse’s legal obligation:  Petitioner did           
          not demonstrate that her former spouse is obligated by their                
          divorce decree to pay this deficiency.  This factor is neutral.             
               5.  Significant benefit:  Petitioner received no significant           
          benefit from the unpaid tax, other than normal support.  This               
          factor is neutral.                                                          

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