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            The facts of this case are that Bart and Arlene Keating have filed joint returns for the years 1998 and 1999. During these two years, Arlene had embezzled $90,000 from her employer and had not reported it as income on the tax statements. Bart signed the joint returns without looking over them, and he was not aware that Arlene was embezzling money from her employer.
             The question in this case is if Bart Keating should be held liable for the tax consequences and the embezzled funds.
             In my opinion, Bart should not be liable for the tax liability according to the tax codes 6013 and 6015, Tax Regulation 1.6013-5(b), and according to the judgment in the Albert Ferrarese case.
             In tax code 6013(e)(1) and 6015(b)(1) it states: if a joint return has been made for a taxable year and on this return there is a substantial understatement of tax attributable to grossly erroneous items of one spouse, and that the other spouse establishes that in signing the return he or she did not know, and had no reasons to know, that there was such substantial understatement, and taking into account all the facts and circumstances, it is inequitable to hold the other spouse liable for the deficiency in tax, then the other spouse shall be relieved of liability for tax. .
             These tax codes protect the Bart Keating, the innocent spouse, who did not know that his wife had been embezzling money from her employer. He also had no reason to know because Arlene took care of all of the finances in the family and Bart thought she obtained any additional money from bank loans and through credit cards.
             Section 1.6013-5(b) of the Income Tax Regulations covers what types of transfer qualify as a benefit to the person seeking relief (Bart). If Bart would have received life insurance money that was bought with the embezzled money, he would have benefited from the money. In my opinion, Bart has not benefited from the money. In the years Arlene embezzled the money, Bart's lifestyle remained modest and normal.

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