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that she had decided to stay collection activity relating to
interest amounts while petitioners’ interest abatement case for
1989 was pending in this Court.
OPINION
This case is another in a long list of cases brought in this
Court involving respondent’s proposal to levy on the assets of a
partner in a Hoyt partnership to collect Federal income taxes
attributable to the partner’s participation in the partnership.
Petitioners argue that Appeals was required to let them pay
$90,258 to compromise their estimated $260,143 Federal income tax
liability for 1987 through 1998. Where an underlying tax
liability is not at issue in a case invoking our jurisdiction
under section 6330(d), we review the determination of Appeals for
abuse of discretion. See Sego v. Commissioner, 114 T.C. 604, 610
(2000); see also Clayton v. Commissioner, T.C. Memo. 2006-188;
Barnes v. Commissioner, T.C. Memo. 2006-150. We reject the
determination of Appeals only if the determination was arbitrary,
capricious, or without sound basis in fact or law. See Cox v.
Commissioner, 126 T.C. 237, 255 (2006); Murphy v. Commissioner,
125 T.C. 301, 308, 320 (2005), affd. 469 F.3d 27 (1st Cir. 2006).
Where, as here, we decide the propriety of Appeals’s
rejection of an offer-in-compromise, we review the reasoning
underlying that rejection to decide whether the rejection was
arbitrary, capricious, or without sound basis in fact or law.
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