W. Richard and Janice J. Morgan - Page 3

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          to the proof of claim of the IRS for the 1983 tax liability                 
                    3.  The Debtors [Morgans] and the United States                   
               agree that, notwithstanding the fact that the                          
               underlying debt is dischargeable for the 1983 tax year,                
               a federal tax lien filed by the Internal Revenue                       
               Service encumbers all of the Debtors’ property,                        
               including any exempt property, to the extent it exists.                
               * * *                                                                  
          The only asset that petitioners had that was exempt from the                
          discharge order was the pension plan of petitioner W. Richard               
          Morgan (petitioner).                                                        
               In the bankruptcy proceedings, petitioners were represented            
          by an attorney.  Petitioners were also represented by a tax                 
          attorney with respect to their 1981, 1982, and 1983 income tax              
          liabilities.  Petitioners’ tax attorney had been engaged in the             
          practice of tax law since 1959 and had experience in tax                    
          controversies and transactions planning.  Petitioners’ tax                  
          attorney had reviewed the law, regulations, and procedures on               
          installment agreements.                                                     
               In March 1995, petitioners submitted an offer-in-compromise            
          to the IRS, which was later rejected.  After the rejection of the           
          offer-in-compromise, petitioners’ delinquent tax accounts were              
          assigned to Revenue Officer Elizabeth Cooper (Cooper).  Between             
          July 1997 and May 1998, Cooper advised petitioners’ attorney on             
          numerous occasions that petitioners needed to commence monthly              
          payments immediately while petitioners prepared a second offer-             

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