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the requesting spouse knew or had reason to know at the time the
agreement was entered into that the nonrequesting spouse would
not pay the liability, then this factor will not weigh in favor
of relief. See id.
The “Marital Settlement Agreement” provided that Mr. Nakasu
was to assume and pay the Federal tax liabilities. There is no
evidence that petitioner knew at the time they entered into the
“Marital Settlement Agreement” in 2002 that Mr. Nakasu would not
pay the Federal tax liabilities. But the Court finds that
petitioner had reason to know at the time they entered into the
agreement that Mr. Nakasu would not pay the Federal tax
liabilities. Petitioner testified that she was the one who “made
the call to enter into the installment agreement” in 2001 because
she believed that Mr. Nakasu had a pattern of not paying his
debts due to his procrastination. This factor is neutral. Id.;
see also Magee v. Commissioner, T.C. Memo. 2005-263 (applying
Rev. Proc. 2003-61); cf. Billings v. Commissioner, T.C. Memo.
2007-234 (applying Rev. Proc. 2000-15).
Significant Benefit
The IRS will consider whether the requesting spouse received
any significant benefit beyond normal support as a result of the
unpaid income tax liability. See Rev. Proc. 2003-61, sec.
4.03(2)(a)(v), 2003-2 C.B. at 299.
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