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H. Rejection of Petitioner’s Offer in Compromise
By letter dated May 13, 1999, respondent rejected
petitioner’s Offer in Compromise. The letter stated in relevant
part as follows:
This refers to your offer of $500.00, submitted to
compromise your unpaid employment tax liabilities for
the tax periods shown above.
4(...continued)
under section 7436 for processing employment tax cases involving
worker classification and sec. 530 of the Revenue Act of 1978.
Notice 98-43 provides in relevant part as follows:
AGREED SETTLEMENTS
If the taxpayer wishes to settle the worker
classification and � 530 issues on an agreed basis
before issuance of a Notice of Determination, the
taxpayer must formally waive the restrictions on
assessment contained in �� 7436(d)(1) and 6213. This
will generally be accomplished by execution of an
agreed settlement that contains the following language:
I understand that, by signing this
agreement, I am waiving the restrictions on
assessment provided in sections 7436(d) and
6213(a) of the Internal Revenue Code of 1986.
The Service will not assess employment taxes
attributable to worker classification or � 530 issues
unless either the Service has issued a Notice of
Determination to the taxpayer and the 90-day period for
filing a Tax Court petition has expired or,
alternatively, the taxpayer has waived the restrictions
on assessment. If the Service erroneously makes an
assessment of taxes attributable to worker
classification and � 530 issues without first either
issuing a Notice of Determination or obtaining a waiver
of restrictions on assessment from the taxpayer, the
taxpayer is entitled to an automatic abatement of the
assessment. However, once any such procedural defects
are corrected, the Service may reassess the employment
taxes to the same extent as if the abated assessment
had not occurred.
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