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the transaction at issue involves a tax shelter. Reducing the
risks of participating in tax shelters would encourage more
taxpayers to run those risks, thus undermining rather than
enhancing compliance with the tax laws.15 See Clayton v.
Commissioner, supra; Barnes v. Commissioner, supra.
Sixth, petitioners argue that Cochran failed to balance
efficient collection with the legitimate concern that collection
be no more intrusive than necessary. We disagree. Cochran
thoroughly considered this balancing issue on the basis of the
information and proposed collection alternative given to her by
petitioners. She concluded that “the proposed levy action
regarding the taxpayers represents the only efficient means for
collection of the liability at issue in this case”. While
petitioners assert that Cochran did not consider all of the facts
and circumstances of this case, “including whether the
circumstances of a particular case warrant acceptance of an
amount that might not otherwise be acceptable under the
15 Nor does the fact that petitioners’ case may be
“longstanding” overcome the detrimental impact on voluntary
compliance that could result from respondent’s accepting
petitioners’ offer-in-compromise. An example in IRM sec.
5.8.11.2.2 implicitly addresses the “longstanding” issue. There,
the taxpayer invested in a tax shelter in 1983, thereby incurring
tax liabilities for 1981 through 1983. He failed to accept a
settlement offer by respondent that would have eliminated a
substantial portion of his interest and penalties. Although the
example, which is similar to petitioners’ case in several
respects, would qualify as a “longstanding” case by petitioners’
standards, the offer was not acceptable because acceptance of it
would undermine compliance with the tax laws.
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