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(3) Hoyt’s criminal conviction; (4) Hoyt’s fraud on petitioner;
and (5) other letters and cases. The basic thrust of
petitioner’s argument is that he was defrauded by Hoyt and that,
if he were held responsible for penalties and interest incurred
as a result of their investment in a tax shelter, it would be
inequitable and against public policy. Petitioner’s argument is
not persuasive.
While the regulations do not set forth a specific standard
for evaluating an offer-in-compromise based on claims of public
policy or equity, the regulations contain two examples. See sec.
301.7122-1(c)(3)(iv), Examples (1) and (2), Proced. & Admin.
Regs. The first example describes a taxpayer who is seriously
ill and unable to file income tax returns for several years. The
second example describes a taxpayer who received erroneous advice
from the Commissioner as to the tax effect of the taxpayer’s
actions. Neither example bears any resemblance to this case.
Unlike the exceptional circumstances exemplified in the
regulations, petitioner’s situation is neither unique nor
exceptional in that his situation mirrors those of numerous other
taxpayers who claimed tax shelter deductions in the 1980s and
1990s. See Keller v. Commissioner, T.C. Memo. 2006-166; Barnes
v. Commissioner, T.C. Memo. 2006-150.
Of course, the examples in the regulations are not meant to
be exhaustive, and petitioner has a more sympathetic case than
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