Jeffrey Chou and Cindy Chou - Page 6




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          of petitioners’ liability for 2000 to be $2,703,152.90.  On                 
          November 13, 2003, the IRS sent petitioners a Notice of Federal             
          Tax Lien for 2001.                                                          
               On December 4, 2003, petitioners filed a Request for a                 
          Collection Due Process Hearing for 2000 and 2001 in response to             
          the Notice of Intent to Levy.  On December 16, 2003, petitioners            
          filed a Request for a Collection Due Process Hearing for 2000 and           
          2001 in response to the Notice of Federal Tax Lien.                         
               On April 8, 2004, petitioners filed a refund action for 2001           
          in the U.S. District Court for the Northern District of                     
          California.  On July 6, 2004, the District Court action was                 
          dismissed for lack of subject matter jurisdiction.  The dismissal           
          was appealed to the U.S. Court of Appeals for the Ninth Circuit,            
          but the appeal was dismissed on November 23, 2005.                          
               On April 9, 2004, the IRS notified petitioners that their              
          amended return for 2000 was being audited.  On May 13, 2004,                
          respondent’s Appeals Office sent a Decision Letter Concerning               
          Equivalent Hearing to petitioners regarding their tax liability             
          for 2000.  An equivalency hearing had been conducted because no             
          request for a hearing was filed within the 30-day period                    
          prescribed by section 6320 and/or 6330 with respect to                      
          petitioners’ liability for 2000.  In the decision letter, a                 
          Notice of Intent to Levy dated December 6, 2001, was not                    
          sustained because petitioners’ OIC was pending at the time that             







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