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(notice of determination). The issues for decision are: (1)
Whether respondent abused his discretion in failing to abate
interest, and (2) whether respondent improperly refused to abate
assessments for additions to tax for failure to file under
section 6651(a)(1) and failure to pay under section 6651(a)(2).
Background
Some of the facts have been stipulated, and they are so
found. Petitioners resided in Tampa, Florida, at the time the
petition was filed.
Petitioners filed a 1997 Federal income tax return on March
1, 2001. The 1997 return reflected a tax due. There was no
remittance with the return. Respondent assessed the tax as well
as interest and additions to tax.
On May 1, 2002, respondent received an offer in compromise
(OIC) submitted by petitioners. The OIC was returned to
petitioners on May 23, 2002, because respondent’s records
reflected that petitioners were not current in the filing of
quarterly employment tax returns. By cover letter dated June 27,
2002, petitioners resubmitted the OIC. Petitioners advised in
the letter that there was no payroll for their business, and
therefore no employment tax returns were due.
The OIC was rejected in an Internal Revenue Service letter
dated April 21, 2003. The letter advised petitioners that the
amount offered was less than the reasonable collection potential.
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Last modified: May 25, 2011