Roger D. and Mary M. Catlow - Page 7

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          expenses for food, clothing, miscellaneous items, transportation,           
          and health care.  First, Cochran determined that petitioners were           
          allowed a food, clothing, and miscellaneous items expense of                
          $1,020 instead of the $1,271 that they claimed.  Cochran stated             
          that she made this adjustment in accordance with current national           
          guidelines and that she considered petitioners’ particular                  
          circumstances but that they did not warrant allowing the higher             
          figure submitted by petitioners.  Cochran also reduced                      
          petitioners’ transportation expenses from $1,244 to $902 in                 
          accordance with the applicable guidelines.  Finally, Cochran                
          adjusted petitioners’ allowable health care expenses from the               
          $1,103 that they claimed on their Form 433-A to $300.  Cochran              
          noted that petitioners had not mentioned any health issues nor              
          provided any documentation of medical bills.  She also commented            
          that the only health care-related expense that petitioners had              
          documented was a long-term care insurance policy expense of $182            
          a month.  In sum, Cochran reduced petitioners’ monthly allowable            
          expenses to $3,755.                                                         
               Cochran determined that petitioners’ monthly excess income             
          (i.e., monthly income less monthly expenses) was $796 ($4,551 -             
          $3,755), that petitioners’ income potential for the next                    
          48 months was approximately $38,208 ($796 x 48 = $38,208),11 and            

               11 Cochran used a 48-month factor because petitioners were             
          offering to compromise their tax liability by paying cash.  See             
                                                             (continued...)           





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