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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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Last modified: November 10, 2007