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instead, used the national statistical amount as an estimate of
petitioners’ expenses. The use of the national averages for
petitioners’ expenses resulted in petitioners’ monthly expenses
exceeding their monthly income by $36. Therefore, by using the
average expense figure, petitioners’ income was $136 short of
producing the $100 per month needed to compromise their tax
liabilities for $2,400. We note that, percentagewise, the
shortfall is less than 3 percent of petitioners’ gross income.
The Appeals officer chose to use the national statistical
averages rather than the expense figures provided by petitioners.
If the Appeals officer had used petitioners’ submitted expense
figure of $3,989, petitioners would have had $619 monthly and
would have been financially capable of satisfying the $100
installments.
The Appeals officer is allowed to use the national schedules
when considering the facts and circumstances of this case.
However, if use of the schedules results in petitioners’ not
having adequate means to provide for basic living expenses, as
here when the Appeals officer determined a negative $36 amount
for basic living expenses, an installment offer may not be
appropriate. See sec. 7122(c)(2)(B).
Under the regulations for doubt as to collectibility cases:
A determination of doubt as to collectibility will
include a determination of ability to pay. In
determining ability to pay, the Secretary will permit
taxpayers to retain sufficient funds to pay basic
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Last modified: May 25, 2011