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in managing the finances of Contractor because his education was
limited.
Petitioner’s counsel agrees that petitioner was involved in
the business. He argues, however, that the individual
adjustments were small and that petitioner could not have
actually known of every single transaction that had occurred at
the time she signed the return. Under counsel’s reasoning,
petitioner would be required to have a tax professional’s level
of expertise for the Court to find actual knowledge under section
6015(c)(3)(C). In Cheshire v. Commissioner, 115 T.C. at 194, the
Court rejected this knowledge standard.
Petitioner testified that she reviewed all canceled checks
for Contractor, separated the checks into business related or
personal, and made notes of what each check was for. Petitioner
agreed that she knew whether a given expense was business or
personal. Therefore, she had knowledge of the facts as to
whether an item was allowable as a deduction. See sec. 1.6015-
3(c)(2)(i)(B), Income Tax Regs. These admissions are sufficient
for the Court to find that petitioner had actual knowledge of the
pertinent items at the time that she signed the 1997 return.
In addition, respondent asserts that petitioner has held
herself out as the owner of Contractor. In support, respondent
produced copies of: (1) Form 943, Employer’s Annual Tax Return
for Agricultural Employees for 1995 and 1996, (2) Form 940-EZ,
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