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respect to each of those years.2 In response to such notices,
petitioners declined to request an Appeals Office hearing.
Instead, they decided to file an offer-in-compromise with respon-
dent.
Nonetheless, during the consideration by the Appeals Office
of petitioners’ notice of tax lien with respect to petitioners’
taxable years 2000 and 2001, the settlement officer and the
second settlement officer, although not required to do so,
considered whether to abate the additions to tax under sections
6651(a)(2) and 6654 that respondent assessed with respect to
petitioners’ taxable year 2000 and/or their taxable year 2001.
As reflected in the attachment to the notice of determination
upon which this case is based, the second settlement officer
concluded that petitioners had failed to establish reasonable
cause to abate such additions to tax.
An Appeals officer may, within such officer’s sole discre-
tion, consider issues that are precluded from consideration under
section 6330(c)(2)(B). However, consideration of any such
2We reject petitioners’ position that “A penalty abatement
request * * * is in that respect materially different from a
challenge to the underlying tax liability.” The Court has held
that the phrase “underlying tax liability” in sec. 6330(c)(2)(B)
is “a reference to the amounts that the Commissioner assessed for
a particular tax period.” Montgomery v. Commissioner, 122 T.C.
1, 7 (2004). What the Court concluded in Montgomery applies in
the instant case: “petitioners’ underlying tax liability con-
sists of the amount that petitioners reported due on their tax
return along with statutory interest and penalties.” Id. at 8.
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