118 T.C. No. 2 UNITED STATES TAX COURT BARRY R. DOWNING AND MARY A. DOWNING, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 2217-00L. Filed January 7, 2002. Petitioners (Ps) filed a return for 1995 in which they correctly reported their tax liability but did not pay the tax owed. Ps included $5,000 and an offer in compromise in which they offered to pay that amount in full settlement of the $32,561 tax they owed. Respondent (R) misplaced Ps’ offer in compromise for about 1 year. R did not accept that offer in compromise or four similar offers in compromise made by Ps because R believed R could collect a substantially larger amount of Ps’ 1995 tax liability. R issued to Ps a notice of intent to levy. Ps requested and received a hearing on the proposed collection action under sec. 6330, I.R.C. Ps contended that they had reasonable cause for their failure to pay tax and requested that interest be abated because R had misplaced their offer in compromise for 1 year. R issued a notice of determination to Ps stating that interest would not be abated and that collection would proceed.Page: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
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