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Does Abuse Have to be Proven?

Ogden v. Comm’r, T.C. Memo. 201988, 2019 WL 3162423 (2019)

(a) Facts: Husband and wife were married in 1991 and divorced in 2011. The wife was granted Social Security disability benefits in 2008. She received $36,083 that year and $10,297 in 2010.

On their 2008 tax return, the parties did not report the wife’s benefits. On their 2010 return, the parties reported the benefits but did not pay the tax. Both returns were prepared by the husband.

The IRS assessed a deficiency for 2008. The wife filed a petition for discretionary innocent spouse relief. The IRS granted the petition as to the husband’s income but denied the petition as to the wife’s income. The wife sought review in the Tax Court.

(b) Issue: Was the wife entitled to discretionary innocent spouse relief from tax on her own income?

(c) Answer to Issue: No.

(d) Summary of Rationale: One of the threshold requirements for discretionary innocent spouse relief is that the tax cannot arise from the requesting spouse’s own income. But there is an exception for abuse. The wife argued that she was abused during the marriage. The court noted:

By the time the 2008 return was filed in 2009, petitioner and Mr. Ogden were separated and living apart. There is no documentation provided by petitioner’s physicians or mental health care provider, nor a law enforcement entity, attesting to either physical or psychological abuse suffered by petitioner at the hands of Mr. Ogden. No witnesses testified to the alleged abuse suffered by petitioner. Petitioner’s own allegations of abuse are vague and generalized.

2019 WL 3162423, at *8-9. Even if the wife’s claims of abuse were credible, the wife testified that she was unaware that her Social Security benefits were taxable. Thus, the facts simply did not show that abuse prevented the wife from objecting to the husband’s decision on how to treat her benefits for tax purposes.

For 2010, there was no evidence that abuse limited the wife’s ability to question the husband’s nonpayment of the balance of taxes due.

Because the abuse exception was not proven, the wife was not entitled to innocent spouse relief from tax due on her own income.

Observations:

1. Again, the wife’s evidence of abuse was weak, and the court effectively found that no abuse had occurred.

2. The developing rule seems to be that the Tax Court is looking for some amount of evidence to corroborate a claim for abuse. Genuine abuse usually results in police or medical reports, testimony of at least some third-party witnesses, or evidence of domestic violence claims in state court, either as a request for a protective order or as an issue in a divorce case. The Tax Court is much more likely to find abuse when at least some amount of corroborative evidence is present.

3. There is no legal requirement for corroborative evidence. It is possible that an unsupported claim of abuse, made in the requesting spouse’s testimony, might be accepted in at least some cases. But the trend is to reject such testimony, especially where it is very general.