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certainly reduced petitioner’s expendable income in November and
December of 2000, it does not establish that payment of the
outstanding tax liability would prevent petitioner from paying
reasonable basic living expenses. Petitioner has presented no
evidence, either to respondent or to the Court, that she would
suffer economic hardship if denied relief. Common sense suggests
that payment of the outstanding tax liability would put
petitioner in a less-than-desirable financial situation.
However, based on petitioner’s complete lack of proof, we have no
choice but to conclude petitioner would not suffer economic
hardship if she were denied relief. This factor weighs against
relief.
6. Knowledge or Reason To Know
In determining whether a taxpayer qualifies for equitable
relief under section 6015(f), the Commissioner considers whether
the requesting spouse knew or had reason to know that the
reported liability would be unpaid at the time the return was
signed. Rev. Proc. 2000-15, sec. 4.03(2)(b), 2000-1 C.B. at 449.
Respondent determined that petitioner knew or had reason to
know that the reported liability would be unpaid when the 1998
and 1999 returns were filed. Petitioner argues that she was
unaware of the tax problems surrounding Mr. Crouch’s business
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