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Allowable
Income Expense Type Expense Amount
$10,834 National standard1 $1,235
Housing & utilities 1,223
Transportation 1,070
Health care 382
Taxes 1,546
Total 5,456
Ms. Clinger concluded that petitioners had the ability to pay
$5,378 per month–-the net difference between petitioners' monthly
income and monthly allowable expenses--toward their outstanding
1995 tax liability. Petitioners declined Ms. Clinger's offer of
an installment agreement. Petitioners also requested an
abatement of interest on the deficiency because they feel the
audit of their 1995 tax year was prolonged due to mistakes of the
IRS employees who performed the audit.
Upon consideration of petitioners' submitted documentation,
Ms. Clinger prepared a Form 1271-c, Rejection or Withdrawal
Memorandum, recommending that petitioners' OIC be rejected. Ms.
Clinger concluded that, given petitioners' available asset equity
and monthly disposable income, petitioners have the ability to
pay the liability in full via an installment agreement. She also
noted that petitioners did not demonstrate any special
circumstances or grounds for an exception for effective tax
1National standard expenses are for clothing and clothing
services, food, housekeeping supplies, personal care products and
services. See Schulman v. Commissioner, T.C. Memo. 2002-129 n.6.
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Last modified: May 25, 2011