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Petitioner also struggled with alcohol, drugs, and depression,
for which he entered rehabilitation in the fall of 2003.
As of 2004, petitioner’s outstanding tax liabilities for the
years 1990, 1993, 1994, 1996, 1997, 1999, 2000, and 2001 totaled
$169,145.97. On February 9, 2004, respondent received from
petitioner a Form 656, Offer in Compromise, offering to pay
$1,000 based on doubt as to collectibility. Petitioner also
provided a Form 433-A, Collection Information Statement for Wage
Earners and Self-Employed Individuals, indicating that he was
unemployed, lived with friends, received money from his parents
“from time to time” and had no assets.
Respondent thereafter evaluated petitioner’s offer,
preparing, inter alia, a “Full Pay Worksheet” dated February 17,
2004, and income/expense and asset/equity tables dated July 16,
2004. The worksheet indicated that petitioner’s total ability to
pay was zero and stated that “Initial Analysis indicates a Low-
Income Taxpayer that can’t pay with assets at this time”. The
income/expense table reflected that petitioner had monthly income
and allowed expenses of $653 and $1,012, respectively, for a $359
monthly negative cashflow, and that “the amount that could be
paid” was zero. The asset/equity table showed that petitioner
had a “total minimum value” of zero.
Nevertheless, respondent rejected petitioner’s $1,000 offer-
in-compromise because petitioner had “an egregious history of
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