Erminio E. Pietromonaco and Emilia R. Pietromonaco v. Commissioner., United States Tax Court - Memorandum Decision, T.C. Memo. 1991-472, Docket No. 6870-89., Filed September 25, 1991

Erminio E. Pietromonaco and Emilia R. Pietromonaco v. Commissioner.

United States Tax Court - Memorandum Decision

T.C. Memo. 1991-472

Docket No. 6870-89.

Filed September 25, 1991.

Bruce I. Hochman, 9100 Wilshire Blvd., Beverly Hills, Calif., for the petitioner. Mary Schewatz, for the respondent.

Supplemental Memorandum Opinion

PARR, Judge: On August 5, 1991, we filed our opinion in this case, Pietromonaco v. Commissioner [Dec. 47,518(M)], T.C. Memo 1991-361 ( Pietromonaco I). Petitioners filed a Rule 161, motion for reconsideration of findings or opinion.

In Pietromonaco I, we held that petitioner-wife failed to satisfy all of the requirements of section 6013(e) and was liable for all deficiencies and additions. We stated in the opinion that Erminio Pietromonaco had unreported income of $59,530, $62,837, and $76,559 for tax years 1980, 1981, and 1982, respectively. However, these amounts erroneously included self-employment income. The correct amount of unreported income is $36,766, $40,066, and $34,804 for 1980, 1981, and 1982, respectively.

Petitioner-wife contends that in light of this adjustment and considering petitioner's medical condition, the Court should reconsider its decision and grant innocent-spouse relief. We disagree. Erminio Pietromonaco admittedly substantially understated his taxable income. Mrs. Pietromonaco was fully aware of the amount of monthly and yearly expenditures for the maintenance of her household. She had the opportunity to analyze the amount of income earned by her husband by examining the bank statements and reviewing the tax returns prior to signing them; she chose not to. She should have known that the amount of income reported on the tax returns could not substantiate the Pietromonacos' lifestyle.

Furthermore, there is no inequity in denying petitioner-wife relief. She enjoyed the fruits of her husband's dishonesty. On reported adjusted gross income of $9,224, $9,581, and $16,371 for 1980, 1981, and 1982, respectively, petitioner enjoyed dining out weekly, at least 4 trips to Las Vegas yearly, the expertise of a gardener, regular visits to the hair salon, and other leisure activities. Upon her husband's illness, all of his assets were transferred into her name. She utilized the monies in the bank accounts to maintain her lifestyle until they were depleted.

We will grant petitioners' motion only for the limited purpose of clarifying the record, and to be in accordance with the agreed facts. Otherwise, petitioners' motion is denied.

An appropriate order will be issued.

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