Louis A. and Christine Cox - Page 36

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          obligations throughout the pendency of their cases before                   
          Mr. Skidmore from early 2003 to mid-2004.  The notice of                    
          determination for 2000 was issued on November 25, 2003, and that            
          for 2001 and 2002 was issued on July 13, 2004.  Estimated                   
          payments, intended to ensure that current taxes are paid, are a             
          significant component of the Federal tax system, and Mr. Skidmore           
          was entitled to rely on their absence in reaching his                       
          conclusions.  In fact, petitioners’ circumstances illustrate one            
          of the reasons for requiring current compliance before granting             
          collection alternatives such as an offer-in-compromise or an                
          installment agreement; namely, the risk of pyramiding tax                   
          liability.  See Orum v. Commissioner, 412 F.3d 819, 821 (7th Cir.           
          2005), affg. 123 T.C. 1 (2004).                                             
               As to alleged mitigating circumstances during the years in             
          issue, the Court understands that petitioners had little control            
          over medical exigencies or an industry slowdown.  Petitioners               
          claim that these circumstances establish that financial                     
          inability, rather than lack of desire, was responsible for their            
          dilatory filings and payments.  Again, however, current                     
          compliance is most germane.  In addition, as Mr. Skidmore noted             
          repeatedly, petitioners’ assertions of financial hardship are               
          difficult to square with the substantial cashflow through their             
          accounts.  Mr. Skidmore concluded that petitioners’ broad                   
          assertions of business need and use did not satisfactorily                  






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