Larry J. and Sherilyn Wadsworth - Page 20

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          relies solely and entirely on the presumption of correctness that           
          normally attaches to a notice of deficiency.                                
               Finally, respondent has not yet been given an opportunity to           
          present evidence supporting his determinations.  Petitioners’               
          assertion that respondent is merely resting on the presumption of           
          correctness is therefore premature, and petitioners’ reliance on            
          Weimerskirch is misplaced.                                                  
               Petitioners also rely on Shea v. Commissioner, supra, in               
          support of their motion to shift the burden of proof.  In Shea,             
          the Commissioner issued a notice of deficiency in which he                  
          changed a California-resident taxpayer’s filing status from                 
          married filing jointly to married filing separately yet                     
          determined an amount of unreported income without making any                
          adjustment for California’s community property law.  Had that law           
          been considered, unless an exception under section 66(b) applied,           
          the taxpayer would have been required to report and be taxed on             
          only one-half of the taxpayer’s income from a business he                   
          conducted while married.  The notice of deficiency in Shea did              
          not refer to California community property law, any exceptions to           
          that law, or any facts that might support such exceptions.                  
               Although the parties in Shea agreed that section 66(b)                 
          authorizes the Commissioner to disallow the benefits of community           
          property law to a taxpayer under certain circumstances, the                 
          taxpayer argued that because the Commissioner made no                       

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Last modified: May 25, 2011