LMM My Tax Man
|Posted on January 31, 2018 at 2:30 PM|
A not-so-innocent spouse gets innocent spouse relief in this case.
A couple who later divorced failed to report on their jointly filed return
taxable payouts from the wife’s retirement account, a portion of which was deposited
into the couple’s joint checking account. She claimed on audit that her ex-husband
should be liable for half the deficiency. IRS and the Tax Court let him off the hook
because, although all sides agreed that he should have known about the distribution,
there was no proof that he had actual knowledge of it (Bishop, TC Summ. Op. 2018-1).