Rev. Rul. 80-5

1980-1 C.B. 284, 1980-1 I.R.B. 15.

                       Internal Revenue Service
                                 Revenue Ruling

       SALE OF RESIDENCE; AMENDED JOINT RETURN WITHOUT SPOUSE'S SIGNATURE

                           Published: January 7, 1980

Section 6013.--Joint Returns of Income Tax by Husband and Wife, 26 CFR 1.6013- 1: Joint returns.

(Also Section 1034; 1.1034-1.)

  Sale of residence; amended joint return without spouse's signature. A taxpayer and the taxpayer's spouse filed a joint return defering the gain on the sale of their personal residence under section 1034 of the Code. They subsequently obtained a divorce. The former spouse reinvested the amount required under section 1034 and refused to sign an amended return with the taxpayer, who failed to purchase a new residence within the 18-month period. The taxpayer must file an amended joint return for the year of the sale with a letter explaining why the spouse's signature is missing.

ISSUE

  What type of return must be filed by a taxpayer who previously filed a joint return without reporting the gain on the sale of a residence and subsequently failed to meet the reinvestment requirement of section 1034 of the Internal Revenue Code when the taxpayer is now divorced and the ex-spouse refuses to sign an amended return?

FACTS

  A taxpayer and spouse filed a joint federal income tax return without reporting the gain on the sale of their jointly-owned principal residence because they expected to purchase a new principal residence within 18 months of the sale and defer recognition of the gain under section 1034 of the Code. They were divorced in the next year and the ex-spouse purchased a new principal residence within the 18 month period and reinvested the amount required to defer the ex-spouse's portion of the gain realized on the sale of the old residence.  The taxpayer, however, did not purchase a new residence within the 18 month period.  The ex-spouse refused to sign an amended joint return.

LAW AND ANALYSIS

  Section 1034 of the Code provides that no gain from the sale of property used by a taxpayer as a principal residence shall be recognized if the taxpayer purchases and uses as a principal residence a new residence within 18 months of the sale at a cost equal to or in excess of the sales price realized by the taxpayer on the old residence, less the aggregate of the expenses for work performed on the old residence to assist in its sale.

  Section 1.1034-1(i) of the Income Tax Regulations provides that if a taxpayer fails to purchase a new residence within the 18 month period, any gain from the sale of the old residence that is required to be recognized shall be included on an amended return for the year in which the gain from the sale of the old residence was realized in order to reflect the inclusion in gross income for that year of gain required to be recognized in connection with such sale.

  Section 1.6013-1(a)(1) of the regulations provides that for any taxable year with respect to which a joint return has been filed, separate returns shall not be made by the spouses after the time for filing the return of either has expired.

HOLDING

  The taxpayer must file an amended joint income tax return, using the joint return tax rates for the year of the original return, and paying the additional tax with the amended return.  The taxpayer should attach a letter to the amended return explaining why the spouse's signature cannot be obtained.

Rev. Rul. 80-5, 1980-1 C.B. 284, 1980-1 I.R.B. 15.