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see sec. 301.7122-1T(b)(4)(i), Temporary Proced. & Admin. Regs.,
supra; and, even if it did not, would because of “exceptional
circumstances” be “detrimental to voluntary compliance by
taxpayers” by creating doubt as to the fair administration of the
tax laws, see sec. 301.7122-1T(4)(ii), Temporary Proced. & Admin.
Regs., supra.
Respondent rejected both arguments. He concluded that
petitioners could fully satisfy both their tax debt and their
foreseeable expenses without economic hardship. He also
concluded that they had failed to show “exceptional
circumstances” sufficient to justify accepting their compromise.
We examine each issue in turn, mindful that our review under
section 6330 is for abuse of discretion. See Davis v.
Commissioner, 115 T.C. 35, 39 (2000). This standard does not ask
us to decide whether in our own opinion the offer in compromise
should have been accepted, but whether the Commissioner exercised
his “discretion arbitrarily, capriciously, or without sound basis
in fact or law.” Woodral v. Commissioner, 112 T.C. 19, 23
(1999).
A. Hardship
Petitioners suggest that although they currently enjoy
fairly substantial means, their economic future is tainted by a
diagnosis that petitioner Charles Fargo suffers from a
progressive neurological condition that may eventually require
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