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C. Effect of the Noninclusion of Petitioners’ 1992 Taxes in the
Installment Agreement
The parties agree that respondent’s established policy is to
include all balance due accounts in an installment agreement.
Contrary to petitioners’ assertion, however, it does not follow
that noninclusion of a balance due for a particular year thereby
eliminates it. We have concluded that the noninclusion of the
1992 balance due was most likely a mistake. Respondent’s
transcripts of petitioners’ accounts, which are in evidence and
which petitioners do not directly challenge, show that at all
relevant times (including now) petitioners have had an
outstanding unpaid balance for their 1992 tax year. We are
unconvinced that the appropriate remedy for respondent’s
ostensible mistake is to grant petitioners a windfall of a
portion of their otherwise undisputed 1992 tax liability.
In this regard, we note that respondent is not authorized to
compromise a liability except as provided in section 7122
regarding offers in compromise. See Harbaugh v. Commissioner,
T.C. Memo. 2003-316 (“It is well settled that section 7122 and
the regulations thereunder provide the exclusive method of
effectuating a valid compromise of assessed tax liabilities.”).
Unlike an offer in compromise, an installment agreement
necessitates full payment of the tax liability involved without
compromise. See sec. 301.6159-1, Proced. & Admin. Regs.
(providing that an installment agreement “allows the taxpayer to
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