- 18 - specifically addressed in the notice of determination was not an abuse of discretion. 2. Petitioners’ Income and Future Expenses Petitioners assert that Ms. Cochran erroneously determined their future income and expenses by: (1) Considering 86 months of petitioners’ future income instead of 48 months; and (2) failing to adequately consider their age, health, retirement status, medical costs, and the likelihood of future increases in medical and housing costs. Petitioners’ arguments are not persuasive. Section 5.8.5.5 of the IRM provides that, when a taxpayer makes a cash offer to compromise an outstanding tax liability, only 48 months of future income should be considered. Petitioners made a cash offer, but Ms. Cochran used 86 months of future income.13 At trial, Ms. Cochran acknowledged that she should have used only 48 months of future income. Ms. Cochran recomputed petitioners’ reasonable collection potential using 48 months and determined that it was $304,782, instead of $380,706, as reflected in the notice of determination. Ms. Cochran testified that the change would not have had an effect on her final determination because, using either calculation, petitioners’ reasonable collection potential was greater than 13 Ms. Cochran included 41 months of petitioners’ future wage income and 45 months of Mr. Carter’s future monthly pension payments.Page: Previous 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Next
Last modified: May 25, 2011