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failure to timely file a return and pay tax to reasonable cause
and not willful neglect.
Accordingly, respondent is sustained on the imposition of
additions to tax under section 6651(a)(1) and (2), but the
amounts of the additions to tax must be adjusted to account for
our finding that petitioner is not liable for tax on a portion of
the community income at issue.
VI. Collection of Underlying Tax Liability
Respondent’s determinations, aside from issues relating to
petitioner’s underlying tax liability, are reviewed for abuse of
discretion. See Sego v. Commissioner, 114 T.C. at 610; Goza v.
Commissioner, 114 T.C. at 181. An abuse of discretion occurs if
the hearing officer takes action that is arbitrary, capricious,
or without sound basis in fact or law. See Woodral v.
Commissioner, 112 T.C. 19, 23 (1999).
Under section 6330(c)(3), the Commissioner’s hearing officer
is required to consider any relevant issue raised at a taxpayer’s
administrative hearing, including spousal defenses, challenges to
the appropriateness of the intended collection action, and
collection alternatives. Aside from challenging her underlying
tax liability, petitioner did not directly raise any relevant
issue relating to the unpaid tax or the proposed levy. No
collection alternatives were discussed. A spousal defense under
section 66 has been fully considered during the Court’s de novo
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