Segudino and Delfa Razo - Page 3

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               On March 26, 2002, petitioners’ counsel, acting under a                
          power of attorney from petitioners, submitted on behalf of                  
          petitioners a Form 12153, Request for a Collection Due Process              
          Hearing, requesting a hearing under section 6320 with                       
          respondent's Appeals Office.  Also submitted with the Form 12153            
          was a Form 656, Offer in Compromise, setting forth petitioners’             
          offer to pay $100 to settle their 1995, 1996, and 1997 tax                  
          liabilities.  Petitioners’ offer in compromise was based on                 
          “effective tax administration” (ETA).                                       
               A section 6320 hearing was held on August 14, 2002.  On                
          October 3, 2002, respondent's Appeals officer issued the notice             
          of determination rejecting petitioners’ offer in compromise and             
          sustaining the Federal tax lien, but recommending that                      
          petitioners' accounts be suspended as "temporarily not                      
          collectible".  The Appeals officer based his determination to               
          sustain the lien on the value of certain assets owned by                    
          petitioners, which include a house, two vehicles, and personal              
          effects.  The Appeals officer measured the quick sale value of              
          petitioners’ assets, less encumbrances against them, and found              
          that the net amount of petitioners’ equity in the assets greatly            
          exceeded petitioners’ tax liabilities for the years 1995-97.  For           
          example, one of petitioners’ automobiles alone had a quick sale             
          value in excess of the tax liabilities.  However, the Appeals               
          officer then noted that petitioners faced various hardships that            






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