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wrote petitioners to inform them that he had recommended to his
group manager that respondent abate the late payment addition for
1994. He also told petitioners that he had denied their request
to abate the late payment addition for 1993 and 1995-97, in part
because petitioners had not had enough tax withheld for those
years.
On March 3, 1999, Leiba wrote a letter to Sims in which he
argued that petitioners had reasonable cause not to pay tax for
1993, 1995, and 1996.3 Leiba said that the taxpayers had
believed that their withholding was sufficient to pay the tax due
for 1993 and that they had not expected to receive income of
$22,000 from petitioner’s ministorage partnership in 1993.
Sims wrote a letter to Leiba on March 17, 1999, in which he
said that petitioners’ combined wages in 1993, 1995, and 1996
exceeded the average household income for the area. Sims denied
petitioners’ request to abate the late payment addition for 1993,
1995, and 1996.
2. Respondent’s Appeals Office
On April 5, 1999, Leiba wrote to Sims to tell him that
petitioners would appeal to respondent’s Appeals Office Sims’s
denial of petitioners’ request to abate the late payment addition
for 1993, 1995, and 1996. On April 20, 1999, Leiba sent to Sims
3 Petitioners allege that respondent abated the late
payment addition for 1997.
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