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this period was caused by respondent’s failure to provide
petitioners with an escrow demand letter.9 See Douponce v.
Commissioner, T.C. Memo. 1999-398 (holding that respondent’s
failure to provide the taxpayer with a correct payoff amount was
a ministerial act that warranted the abatement of interest).
On July 27, 2003, petitioners submitted to respondent a Form
12153 stating that the lien prohibited them from refinancing
their home. On August 28, 2003, petitioners requested another
payoff amount, but they did not receive a response from
respondent. Almost 1 month later, petitioners again requested a
payoff amount, which they received on September 23, 2003, in the
form of computer printouts. After appealing to an Appeals
officer, petitioners finally received an escrow demand letter on
October 10, 2003. Once petitioners received the escrow demand
letter, World Savings promptly approved their October 16, 2003
loan application and assigned a closing date of October 28, 2003.
On October 31, 2003, petitioners paid in full their outstanding
tax liabilities including interest and additions to tax.
9 We note that the Internal Revenue Manual, section
25.17.4.4.2 (Sept. 1, 2004), provides a procedure for preparing a
Form 10492, Notice of Federal Taxes Due, in the case of an escrow
payoff request during a Ch. 13 proceeding. The Form 10492
contains the identity of the taxpayer, the amounts due for taxes
secured by a lien on the property, and calculations for interest
and penalties. Form 10492 enables the escrow company to pay
respondent directly from the escrow funds in a sale or
refinancing of real property. A similar procedure appears
equally applicable to a refinancing of real property in a non-
bankruptcy case.
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