- 7 - disposable income of $4,746. She calculated that petitioners could pay $227,808 from their future income.7 In sum, Cochran concluded, petitioners’ net realizable equity in assets and future income equaled $932,844. On July 22, 2005, Appeals issued petitioners a notice of determination sustaining the proposed levy. The notice concludes that petitioners’ $83,213 offer-in-compromise is not an appropriate collection alternative to the proposed levy. The notice, citing Internal Revenue Manual (IRM) sections 5.8.11.2.1 and 5.8.11.2.2, states that petitioners’ offer does not meet the Commissioner’s guidelines for consideration as an offer-in- compromise to promote effective tax administration on the basis of economic hardship or equity and public policy. Cochran noted that since petitioners had not specified the basis on which they were making their offer, she considered it under both economic hardship and equity and public policy grounds. As to petitioners’ offer-in-compromise to promote effective tax administration due to economic hardship, the notice states: Considered under economic hardship, the taxpayers have the ability to pay all amounts owed from either their assets or their income stream and still have assets and an income stream remaining worth over $630,000. The amount being offered by the taxpayers represents 8% of the taxpayers’ Reasonable Collection Potential (RCP). 7 Cochran arrived at $227,808 by multiplying petitioners’ monthly disposable income of $4,746 by a factor of 48.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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