TAX COURT OPINION

Case: Keri A. DeGuzman, Petitioner and Brian DeGuzman, Intervenor,
Docket Number: 13230-20
Judge: Toro
Opinion Type: bench
Filed: 06/02/2023
Pages: 22

(Signed) Emin Toro Judge Served 06/02/23 4 Bench Opinion by Judge Emin Toro May 2, 2023 Keri A. deGuzman and Brian deGuzman v. Commissioner of Internal Revenue Docket No. 13230-20 THE COURT: The Court has decided to render oral findings of fact and opinion in this case and the following represents the Court's oral findings of fact and opinion. The oral findings of fact and opinion shall not be relied upon as precedent in any other case. The oral findings of fact and opinion are made pursuant to the authority granted by section 7459(b) of the Internal Revenue Code and Tax Court Rule 152. Rule references in this opinion are to the Tax Court Rules of Practice and Procedure, and section references are to the Internal Revenue Code, in effect at all relevant times. In a notice of deficiency dated August 19, 2020, the Commissioner of Internal Revenue determined tax deficiencies for the 2016, 2017, and 2018 tax years of petitioner, Keri A. DeGuzman, and intervenor, Brian DeGuzman. The Commissioner also determined additions to tax under section 6651(a)(1) and accuracy-related penalties under section 6662(a) for 2016 and 2017. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 After concessions, the sole issue that remains for our 5 decision is whether Ms. DeGuzman is entitled to relief under section 6015(b), (c), or (f) (colloquially referred to as "innocent spouse relief") from the understatements of tax, additions to tax, and penalties set forth in the notice of deficiency. The Commissioner agrees with Ms. DeGuzman that she is entitled to partial relief under section 6015(b) for 2016 and 2017, full relief under section 6015(b) for 2018, and full relief under section 6015(c) for 2016 and 2017. Dr. DeGuzman, however, disagrees. For the reasons that follow, Ms. DeGuzman is entitled to relief under section 6015(c). On the evidence before us, and using the burden- of-proof principles explained below, the Court finds the following facts: FINDINGS OF FACT Some facts have been stipulated and are so found. The Stipulation of Facts, and the Exhibits submitted therewith, are incorporated by this reference. General Background The DeGuzmans met while working at the same hospital in Massachusetts. She was a nurse, and he was completing his residency in cardiothoracic surgery. They eventually married in June 2004. In 2006, they moved from 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Massachusetts to Arizona. While living in Arizona, the 6 DeGuzmans adopted four children together. Ms. DeGuzman was employed as a registered nurse for a time, but this employment ended before 2016. Ms. DeGuzman also established a non-profit, charitable organization in 2012. Dr. DeGuzman was a cardiothoracic surgeon at St. Joseph's Hospital in Arizona. He continued to work there until 2013, when he received his share of the initial proceeds from the sale of Vortex Medical, a company he helped found and partly owned. Dr. DeGuzman also helped found Pavilion Holding Group, a device holding company, in 2007. Since 2014, Dr. DeGuzman has served as Chief Medical Officer for PAVmed Inc., a medical device company. The DeGuzmans' Finances Dr. DeGuzman was the family's sole income earner during much of the DeGuzmans' marriage. Ms. DeGuzman was not employed in 2016, 2017, and 2018. The DeGuzmans maintained joint bank accounts throughout their marriage. In connection with the sale of his interest in Vortex Medical, Dr. DeGuzman received between $8 and 10 million over a specified period and was eligible to receive additional consideration based on the company's sales over a residual period. Dr. DeGuzman's success as a surgeon and 7 especially as a businessman allowed the DeGuzmans to enjoy a lavish lifestyle, particularly after the Vortex transaction. They owned a home worth well in excess of a million dollars and several luxury cars. At one point, they employed a housekeeper, a nanny, a chef, and a gardener. In addition they had professionals come to their home to provide Ms. DeGuzman manicures, cut their children's hair, and maintain their pool. They took expensive vacations, going skiing in France, dogsledding in Sweden, and on a safari in Africa, among others. Their children attended private school. Ms. DeGuzman bought luxury items, such as Hermés Birkin bags and thousand- dollar designer shoes. And they borrowed and spent considerable sums of money in an effort to build a second, twelve-thousand-square-foot "dream home." Shortly before trial, in March 2023, Ms. DeGuzman traded in a 2018 Mercedes Benz awarded to her in the divorce, valued at $31,000, and acquired a new Mercedes Benz costing approximately $78,000. Meanwhile, the DeGuzmans failed to keep current on their tax obligations. From at least 2013 to 2018, the DeGuzmans had some combination of the following every year: failure to timely file their federal income tax returns, failure to pay the amount of tax shown on the 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 returns, understatement of tax shown on the returns, and 8 failure to pay their estimated taxes. This led to ongoing discussions with the Internal Revenue Service (IRS), in which they generally were represented by Elizabeth Hale (formerly Eisenberg), their Certified Public Accountant (CPA). By 2022, they owed the IRS hundreds of thousands of dollars. Ms. Hale represented the DeGuzmans for many years. Dr. and Ms. DeGuzman selected Ms. Hale as their CPA at the recommendation of a friend. Ms. DeGuzman regularly communicated with Ms. Hale and her colleagues and was responsible for providing them information necessary to prepare the DeGuzmans' tax returns, including at least some information related to Dr. DeGuzman's businesses. She was generally responsible for reviewing mail, including tax forms, received by the DeGuzmans and providing relevant materials to Ms. Hale. Ms. DeGuzman also participated in meetings with Ms. Hale and her colleagues regarding the DeGuzmans' tax issues. Ms. DeGuzman holds a college degree, performed at a high level as an intensive care unit nurse before her marriage, and is now pursuing a Master's degree. She understands financial matters and is able to track and analyze complicated transactions. She is capable of distinguishing between personal and business transactions. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 9 The DeGuzmans' Marital Problems The DeGuzmans began experiencing marital problems at some point after moving to Arizona. These marital problems led Ms. DeGuzman to move out in early 2018 and file a Petition for Legal Separation in May 2018. The DeGuzmans' divorce was pending when she commenced this case with our Court and is now final. Tax Returns Ms. Hale, the DeGuzmans' CPA, prepared the DeGuzmans' tax returns, including their joint federal income tax returns for 2016, 2017, and 2018. Both DeGuzmans worked with Ms. Hale in preparing their returns, typically by answering questions and providing documentation she requested. The DeGuzmans' tax returns for 2016 and 2017 were untimely filed, while 2018 was timely. The income on the returns largely related to Dr. DeGuzman's businesses, as did the expenses claimed by the DeGuzmans on Schedules C, Profit or Loss from Business. IRS Examination and Notice of Deficiency The Commissioner examined the DeGuzmans' 2016, 2017, and 2018 tax returns and issued the DeGuzmans the notice of deficiency upon which this case is based. In relevant part, the Commissioner made the following adjustments to the DeGuzmans' tax returns: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 10 For 2016 only, the Commissioner determined that the DeGuzmans should have reported certain interest and capital gain as net investment income on Form 8960, Net Investment Income Tax Individuals, Estates, and Trusts, and adjusted their net investment income accordingly. The interest and capital gain were derived in connection with Dr. DeGuzman's businesses. For 2016 and 2017, the Commissioner disallowed itemized deductions of $162,319 and $164,833, respectively, that the DeGuzmans had claimed on Schedules A, Itemized Deductions, which consisted primarily of "[i]nvestment interest" expenses. In relevant part, the notice of deficiency states that the disallowed "investment interest expense includes interest paid on home acquisition indebtedness and interest paid during the construction of residential real property . . . [which] is not investment interest." Consistent with this position, the Commissioner disallowed the deduction for investment interest expense on the DeGuzmans' 2017 Form 8960 and adjusted their net investment income accordingly. Also for 2016 and 2017, the Commissioner disallowed travel-related deductions claimed on Schedules C in connection with Dr. DeGuzman's reported "Consulting" business because he failed to substantiate the relevant expenses. For 2018, the Commissioner determined that the 11 DeGuzmans failed to report gross receipts of $100,000 on Schedule C. The gross receipts were reported to the Commissioner on Form 1099-MISC, Miscellaneous Information, and related to Dr. DeGuzman's business activities. Request for Innocent Spouse Relief and Tax Court Petition Before the Commissioner issued the notice of deficiency, Ms. DeGuzman filed Form 8857, Request for Innocent Spouse Relief, in April 2020. In relevant part, she requested relief under section 6015 for 2016, 2017, and 2018. In time, as relevant here, the IRS determined that Ms. DeGuzman was entitled to partial relief from the understatements of tax under section 6015(b) for 2016 and 2017, full relief under section 6015(b) for 2018, and full relief under section 6015(c) for 2016 and 2017. Dr. DeGuzman disagreed with the IRS's determination, and the case was transferred to the IRS Independent Office of Appeals (IRS Appeals) for consideration. IRS Appeals sustained the IRS's determination on February 8, 2022. After receiving the notice of deficiency, Ms. DeGuzman timely filed the Petition with our Court on November 16, 2020. Ms. DeGuzman resided in Arizona at the time she filed her Petition. Dr. DeGuzman filed a Notice of Intervention on March 8, 2021. We tried this case on May 1 and 2, 2023, at the 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Court's Las Vegas, Nevada, trial session. Chris J. Sheldon represented Ms. DeGuzman, Fred E. Green, Jr. 12 represented the Commissioner, and Dr. DeGuzman represented himself. I. Introduction OPINION Generally, married taxpayers may elect to file a joint federal income tax return. I.R.C. § 6013(a). If a joint return is made, the tax is computed on the spouses' aggregate income, and each spouse is fully responsible for the accuracy of the return and is jointly and severally liable for the entire amount of tax shown on the return or found to be owing. Id. § 6013(d)(3); Pullins v. Commissioner, 136 T.C. 432, 437 (2011). But, in certain circumstances, a spouse who has made a joint return may seek relief from joint and several liability under procedures set forth in section 6015. I.R.C. § 6015(a). Section 6015 provides a requesting spouse with three alternatives: (1) full or partial relief under subsection (b), (2) proportionate relief under subsection (c), or (3) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 if relief is not available under subsections (b) or (c), 22 equitable relief under subsection (f). Pullins, 136 T.C. 23 at 437; see also Ordlock v. Commissioner, 533 F.3d 1136, 24 1139 (9th Cir. 2008) ("Section 6015(b) is available to all 25 joint filers. Section 6015(c) applies only to those 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 taxpayers who are no longer married, [who are] legally 13 separated, or [who are] not living together. Section 6015(f) provides for selective equitable relief for those taxpayers who do not meet the requirements of § (b) or § (c)."), aff'g 126 T.C. 47 (2006). The Commissioner does not contest that Ms. DeGuzman is entitled to relief from the tax deficiencies for 2016, 2017, and 2018 under a combination of sections 6015(b) and (c). But Dr. DeGuzman alleges she is not entitled to relief. We review the Commissioner's determination de novo. I.R.C. § 6015(e)(7). The scope of our review is limited to the administrative record established at the time of the Commissioner's determination and "any additional newly discovered or previously unavailable evidence." Id.; see also Thomas v. Commissioner, No. 12982-20, 160 T.C., slip op. at 5 (Feb. 13, 2023). The requesting spouse (here, Ms. DeGuzman) generally bears the burden of proving that she is entitled to relief, although this rule is subject to an exception we will discuss later. See Rule 142(a); Porter v. Commissioner, 132 T.C. 203, 210 (2009); see also Jacobsen v. Commissioner, 950 F.3d 414, 420 (7th Cir. 2020) (collecting authorities), aff'g T.C. Memo. 2018-115. II. Section 6015(b) Under section 6015(b), a requesting spouse may 14 seek relief from joint and several liability to the extent it is attributable to an understatement of tax on the return. I.R.C. § 6015(b)(1) (flush language). To qualify for relief under section 6015(b), the requesting spouse must establish that she meets the following requirements: (1) a joint return was made for the year at issue, (2) on that return there is an understatement of tax attributable to erroneous items of the nonrequesting spouse, (3) the requesting spouse did not know or have reason to know of the understatement when she signed the return, (4) it would be inequitable to hold the requesting spouse liable for the deficiency in tax related to the understatement considering all the facts and circumstances, and (5) the requesting spouse made a timely request for relief. I.R.C. § 6015(b)(1). The requesting spouse must meet all five requirements to qualify for relief. Alt v. Commissioner, 119 T.C. 306, 313 (2002), aff'd, 101 F. App'x 34 (6th Cir. 2004). Based on the record before us, we conclude that Ms. DeGuzman failed to establish her compliance with at least two of the requirements. First, she did not show that she had no reason to know about the understatements on the 2016, 2017, and 2018 returns. Second, she did not show that it would be inequitable to hold her liable for 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 the deficiencies related to those understatements. 15 On the first point, a taxpayer has reason to know of an understatement if a reasonable person in similar circumstances could be expected to know that there was an understatement or that further investigation was warranted. Soler v. Commissioner, T.C. Memo. 2022-78, at *7 (citing Butler v. Commissioner, 114 T.C. 276, 283 (2000); Treas. Reg. § 1.6015-2(c)); see also Price v. Commissioner, 887 F.2d 959, 965 (9th Cir. 1989) (applying the standard and listing factors for consideration); Di Giorgio v. Commissioner, T.C. Memo. 2023-44, at *30 33 (discussing the knowledge requirement and collecting authorities); Rogers v. Commissioner, T.C. Memo. 2021-20, at *9 10 (collecting authorities setting out the relevant standards governing unreported income and improper deductions). In this case, the record reflects a long history of noncompliance of which Ms. DeGuzman was at least substantially aware. Ms. DeGuzman is a college graduate who appeared to the Court to be well-versed in financial matters, including interpreting financial documents. And Ms. DeGuzman's numerous and sophisticated communications with Ms. Hale and her colleagues, many of which concern the DeGuzmans' tax troubles, and which took place over a number of years, call into question her claims of 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ignorance regarding the erroneous items on the returns. 16 Ms. DeGuzman presented no credible evidence to offset these considerations. We note that, although Ms. DeGuzman testified that she had experienced abuse, she offered no specific testimony that, as a result of the alleged abuse, she was unable to challenge the treatment of any items on the return for fear of the nonrequesting spouse's (Dr. DeGuzman's) retaliation. Cf. Rev. Proc. 2013-34, § 4.01(7)(d), 2013-43 I.R.B. 397, 400. In our judgement, the record as a whole would not support such a finding, and we decline to make it. Nor does the record support a finding that Dr. DeGuzman maintained such control over the household finances that it restricted Ms. DeGuzman's access to financial information. Cf. id. § 4.02(3)(a), 2013-43 I.R.B. at 400. We decline to make such a finding 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 as well. 17 18 19 20 21 22 23 24 25 On the second point, in determining whether it would be inequitable to hold a requesting spouse liable for a tax deficiency, our Court considers all the facts and circumstances. Alt, 119 T.C. at 314. This includes, among others, (1) whether the requesting spouse derived a significant benefit from the understatement of tax, (2) any wrongdoing on the part of the nonrequesting spouse, and (3) economic hardship to the requesting spouse if she is not excused from the liability. See id.; Podlucky v. 17 Commissioner, T.C. Memo. 2022-45, at *26 (applying factors from Rev. Proc. 2013-34, § 4.03(2), 2013-34 I.R.B. at 400 03); see also Treas. Reg. § 1.6015-2(d). Here again, Ms. DeGuzman's long-time knowledge of the DeGuzmans' noncompliance, and her apparent participation in that noncompliance, cuts against her. So too does her enjoyment of the DeGuzmans' lavish lifestyle, facilitated in part by the understatements at issue. As Dr. DeGuzman candidly and credibly testified, because the DeGuzmans did not report the proper amounts of tax, they had more cash to spend on things Ms. DeGuzman wanted to buy. Nor is this a case where the nonrequesting spouse controlled the household and business finances such that the nonrequesting spouse made the decision on spending funds for a lavish lifestyle. See Rev. Proc. 2013-34, § 4.03(2)(e), 2013-34 I.R.B. at 402. Additionally, any claim of economic hardship lacks support in the record and is questionable considering the division of property implemented in the divorce proceedings. As just one illustration, as we have noted, shortly before trial, Ms. DeGuzman decided to trade in a 2018 Mercedes-Benz for a new one costing about $78,000. She testified that she decided to purchase the new Mercedes-Benz rather than a Kia Telluride that would also have accommodated her family because the transaction 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 18 afforded her a better trade-in value for the existing car and the financing was more attractive. Regardless of whether one agrees with Ms. DeGuzman's economic analysis here (and it is difficult not to view it skeptically), these are not the actions of a taxpayer experiencing economic hardship. In light of these considerations, Ms. DeGuzman has not shown that she meets the requirements of section 6015(b). We therefore turn to section 6015(c). III. Section 6015(c) Under section 6015(c), a requesting spouse may seek to limit her liability for a deficiency in the same manner as if she had filed her original tax return separate from her spouse. See I.R.C. § 6015(d)(3)(A); see also Hopkins v. Commissioner, 121 T.C. 73, 80 (2003). Determinations made under section 6015 preempt state community property laws with respect to the allocation of items on the tax return to one spouse or the other. I.R.C. § 6015(a) (flush language); see also Ordlock, 533 F.3d at 1141 42. To qualify for relief under section 6015(c), the requesting spouse must establish that she meets three requirements: (1) a joint return was filed for the tax year at issue, (2) at the time of election of relief under section 6015(c), she was divorced or legally separated 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 from the nonrequesting spouse or was not a member of the 19 same household as him at any time during the 12 month period ending on the date of the request for relief, and (3) she made a timely election for relief. I.R.C. § 6015(c)(3)(A)(i); see also Freman v. Commissioner, T.C. Memo. 2023-10, at *18. If the Commissioner demonstrates that the requesting spouse had actual knowledge of the item giving rise to a deficiency at the time she signed the return, then we will deny her relief. I.R.C. § 6015(c)(3)(C); see also Culver v. Commissioner, 116 T.C. 189, 194 96 (2001). The parties do not dispute that Ms. DeGuzman meets the general requirements of section 6015(c)(3)(A), so we do not address them further. As the Court has recognized before, if, as here, all of the other requirements of section 6015(c) have been satisfied, then "the burden of proof is shifted to the Commissioner and relief is denied to the requesting spouse only if the Commissioner 'demonstrates that . . . [the requesting spouse] had actual knowledge, at the time such individual signed the return, of any item giving rise to a deficiency'." Lassek v. Commissioner, T.C. Memo. 2019- 145, at *13 (quoting section 6015(c)(3)(C); other citations omitted). But, as the Court has also acknowledged before, "[a]n issue arises where the burden of proof shifts to the 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Commissioner in cases when the Commissioner favors 20 granting relief and the nonrequesting spouse intervenes to oppose it." Id. at *13. Those are the circumstances here. The Commissioner has not raised any arguments that Ms. DeGuzman had actual knowledge of the items giving rise to the deficiency. Instead, Dr. DeGuzman has intervened to allege that the exception should apply to prevent Ms. DeGuzman from receiving relief under section 6015(c). Because the text of section 6015(c)(3)(C) places on the Commissioner the burden to prove the actual knowledge exception, there is a question whether that burden shifts to Dr. DeGuzman as the intervenor. See, e.g., Knight v. Commissioner, T.C. Memo. 2010-242, 2010 WL 4536996, at *2. But we do not need to answer that question today because, regardless of who has the burden (the Commissioner or Dr. DeGuzman), the record lacks sufficient evidence to permit us to conclude that it is more likely than not that Ms. DeGuzman had actual knowledge of the understatements. See also Lassek, T.C. Memo. 2019-145, at *13 14 ("The Court has previously resolved this issue of burden shifting by deciding the case on a preponderance of the evidence as presented by all three parties." (citations omitted)). 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 A. Actual Knowledge Under section 6015(c)(3)(C), a requesting spouse 24 25 21 is not entitled to relief under subsection (c) if she had "actual knowledge . . . of any item giving rise to a deficiency (or portion thereof)." A requesting spouse lacks actual knowledge if she lacks "'an actual and clear awareness . . . of the existence of an item which gives rise to the deficiency.'" Culver, 116 T.C. at 194 (citing Cheshire v. Commissioner, 115 T.C. 183, 195 (2000)). In the case of unreported income, actual knowledge of the item includes knowledge that the income was received. Treas. Reg. § 1.6015-3(c)(2)(i)(A). In the case of a disallowed deduction, actual knowledge means "knowledge of the facts that made the item not allowable." Id. § 1.6015-3(c)(2)(i)(B)(1). Applying these standards, most of the erroneous return items for 2016, 2017, and 2018 were related to Dr. DeGuzman's various businesses. For several of them, the record lacks sufficient specificity as to what the error was. Furthermore, the record does not demonstrate that Ms. DeGuzman had any special knowledge of Dr. DeGuzman's businesses, including any specific items of income derived from them or expenses that Dr. DeGuzman incurred. And apart from the parties' contradictory and general testimony, there is no evidence that Ms. DeGuzman accessed accounts or account statements where the items were reflected or that she discussed the items with Dr. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DeGuzman or Ms. Hale. As a result, we cannot conclude 22 that Ms. DeGuzman had actual knowledge of the items related to Dr. DeGuzman's businesses. With regard to interest expense reflected on the Schedules A for the years at issue, the record does contain a few indications that Ms. DeGuzman was aware of one or more of the loans that gave rise to the disallowed amounts. But again, apart from inconsistent and general testimony, the parties introduced little evidence of what the expenses actually consisted of, let alone evidence that Ms. DeGuzman was aware of sufficient facts (for example, the balances of the loans and the amount of interest paid annually) to constitute actual knowledge. See, e.g., King v. Commissioner, 116 T.C. 198, 204 06 (2001); McDaniel v. Commissioner, T.C. Memo. 2009-137, 2009 WL 1658581, at *6 9; Stergios v. Commissioner, T.C. Memo. 2009-15, 2009 WL 151485, at *4 6. Again, the record falls short of the requisite showing. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 B. Allocation of Deficiencies 20 21 22 23 24 25 Generally under section 6015(c) and (d) an item giving rise to a deficiency is allocated between the requesting spouse and nonrequesting spouse "in the same manner as it would have been allocated if [they] had filed separate returns for the taxable year." I.R.C. § 6015(d)(3)(A); Hopkins, 121 T.C. at 82. An exception to this general rule is provided in section 6015(d)(3)(B), 23 which provides that "an item otherwise allocable to an individual under subparagraph (A) shall be allocated to the other [spouse] to the extent the item gave rise to a tax benefit on the joint return to the other [spouse]." See also Treas. Reg. § 1.6015-3(d)(2)(i). The record in this case supports the conclusion that the items giving rise to the deficiencies for 2016, 2017, and 2018 are allocable to Dr. DeGuzman under the rules of section 6015(d) either because the items were related exclusively to his businesses or because the items provided him with a tax benefit. First, the adjustments to Schedule C in 2016, 2017, and 2018 were all related to Dr. DeGuzman's businesses. Second, the interest income and capital gain that the Commissioner determined should have been reported as net investment income on Form 8960 for 2016 were items from Dr. DeGuzman's businesses. Finally, Dr. DeGuzman derived a tax benefit from deductions claimed on the Schedules A and C that were disallowed by the Commissioner for 2016 and 2017 because the corresponding deductions were used to reduce the amount of taxable income he received from his businesses. The parties have not argued that section 6015(d) requires the deficiencies to be allocated in any other way, so we consider the parties to have forfeited any such 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 24 argument. See Chapman Glen Ltd. v. Commissioner, 140 T.C. 294, 350 (2013) (explaining that an argument not raised is forfeited). We conclude that the deficiencies are allocable to Dr. DeGuzman under sections 6015(c) and (d). Accordingly, Ms. DeGuzman is entitled to full relief from the Commissioner's determinations set forth in the notice of deficiency for 2016, 2017, and 2018 under section 6015(c). IV. Section 6015(f) Having concluded that section 6015(c) provides Ms. DeGuzman full relief from the deficiencies challenged in the Petition, we have no occasion to consider whether she would be entitled to relief from those deficiencies under section 6015(f), I.R.C. § 6015(f)(1)(B), and the Petition raises no other issues with respect to section 6015(f). To reflect the foregoing, an appropriate decision will be entered. This concludes the Court's oral findings of fact and opinion in this case. (Whereupon, at 4:43 p.m., the above-entitled matter was concluded.) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25