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2004-279; Van Scoten v. Commissioner, 439 F.3d 1243 (10th Cir.
2006), affg. T.C. Memo. 2004-275.
Ms. Cochran testified that she considered all of Ms.
Merriam’s and petitioner’s assertions, including the numerous
letters and exhibits. Nevertheless, Ms. Cochran determined that
petitioner did not qualify for an offer-in-compromise.
The mere fact that petitioner’s “equitable facts” did not
persuade respondent to accept petitioner’s offer-in-compromise
does not mean that those assertions were not considered. The
notice of determination and Ms. Cochran’s testimony demonstrate
respondent’s clear understanding and careful consideration of the
facts and circumstances of petitioner’s case. We find that
respondent’s determination that the “equitable facts” did not
justify acceptance of petitioner’s offer-in-compromise was not
arbitrary or capricious, and thus it was not an abuse of
discretion.
We also find that compromising petitioner’s case on grounds
of public policy or equity would not enhance voluntary compliance
by other taxpayers. A compromise on that basis would place the
Government in the unenviable role of an insurer against poor
business decisions by taxpayers, reducing the incentive for
taxpayers to investigate thoroughly the consequences of
transactions into which they enter. It would be particularly
inappropriate for the Government to play that role here, where
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