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physical health condition) are neutral. Petitioners focus on the
hardship, benefit, knowledge, and health factors.
Petitioners assert that, before analyzing the above factors,
we must determine whether petitioners actually owe the taxes
reported on their original return for 2000. We assume that they
do, because, absent compromise, there is no tenable argument that
they do not. We do not comment on the prospects for compromise.
Both parties, however, rely solely on material submitted in
relation to the OIC in their discussion of financial matters.
Petitioners provided no testimony or direct evidence at trial as
to their basic living expenses or Mr. Chou’s continuing ability
to pay them. Petitioners’ hardship argument is essentially that,
if all of the assets owned by petitioners were liquidated and
paid towards the unpaid assessment for 2000, petitioners would
still owe more than $1 million. While this may be an appropriate
analysis with respect to the OIC, it does not establish hardship
in the current record. See sec. 301.6343-1(b)(4), Proced. &
Admin. Regs. (defining hardship as the inability to pay
reasonable basic living expenses). So far as the record
reflects, Mr. Chou continues to earn a substantial income and to
provide more than basic support to the family.
With respect to the significant benefit factor, petitioners
essentially argue that neither petitioner received a benefit from
the unpaid taxes, because the taxes accrued on value that they
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