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Cochran considered all of the evidence submitted to her by
petitioners and applied the guidelines for evaluating an
offer-in-compromise to promote effective tax administration.
Cochran determined that petitioners’ offer was unacceptable
because they were able to pay more than the $100,000 that they
offered to compromise their tax liability. Cochran’s
determination to reject petitioners’ offer-in-compromise was not
arbitrary, capricious, or without a sound basis in fact or law,
and it was not abusive or unfair to petitioners. Cochran’s
determination was based on a reasonable application of the
guidelines, which we decline to second-guess. See Speltz v.
Commissioner, 124 T.C. 165 (2005), affd. 454 F.3d 782 (8th Cir.
2006); Barnes v. Commissioner, supra.
Petitioners make seven arguments in advocating a contrary
result. First, petitioners argue that Cochran’s rejection of
their offer-in-compromise conflicts with the congressional
committee reports underlying the enactment of section 7122.
According to petitioners, their case is a “longstanding” case,
and those reports require that respondent resolve such cases by
forgiving interest and penalties that otherwise apply. We
disagree with petitioners’ reading and application of the
legislative history underlying section 7122. Petitioners’
argument on this point is essentially the same argument that was
considered and rejected by the Court of Appeals for the Ninth
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