26 U.S.C. § 66 : US Code - Section 66: Treatment of community income

Search 26 U.S.C. § 66 : US Code - Section 66: Treatment of community income

(a) Treatment of community income where spouses live apart
If -
(1) 2 individuals are married to each other at any time during
a calendar year;
(2) such individuals -
(A) live apart at all times during the calendar year, and
(B) do not file a joint return under section 6013 with each
other for a taxable year beginning or ending in the calendar
year;
(3) one or both of such individuals have earned income for the
calendar year which is community income; and
(4) no portion of such earned income is transferred (directly
or indirectly) between such individuals before the close of the
calendar year,
then, for purposes of this title, any community income of such
individuals for the calendar year shall be treated in accordance
with the rules provided by section 879(a).
(b) Secretary may disregard community property laws where spouse
not notified of community income
The Secretary may disallow the benefits of any community property
law to any taxpayer with respect to any income if such taxpayer
acted as if solely entitled to such income and failed to notify the
taxpayer's spouse before the due date (including extensions) for
filing the return for the taxable year in which the income was
derived of the nature and amount of such income.
(c) Spouse relieved of liability in certain other cases
Under regulations prescribed by the Secretary, if -
(1) an individual does not file a joint return for any taxable
year,
(2) such individual does not include in gross income for such
taxable year an item of community income properly includible
therein which, in accordance with the rules contained in section
879(a), would be treated as the income of the other spouse,
(3) the individual establishes that he or she did not know of,
and had no reason to know of, such item of community income, and
(4) taking into account all facts and circumstances, it is
inequitable to include such item of community income in such
individual's gross income,
then, for purposes of this title, such item of community income
shall be included in the gross income of the other spouse (and not
in the gross income of the individual). Under procedures prescribed
by the Secretary, if, taking into account all the facts and
circumstances, it is inequitable to hold the individual liable for
any unpaid tax or any deficiency (or any portion of either)
attributable to any item for which relief is not available under
the preceding sentence, the Secretary may relieve such individual
of such liability.
(d) Definitions
For purposes of this section -
(1) Earned income
The term "earned income" has the meaning given to such term by
section 911(d)(2).
(2) Community income
The term "community income" means income which, under
applicable community property laws, is treated as community
income.
(3) Community property laws
The term "community property laws" means the community property
laws of a State, a foreign country, or a possession of the United
States.