Gary and Johnean Hansen - Page 12

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               Section 6330(c)(2)(A)(iii) allows a taxpayer to offer to               
          compromise a Federal tax debt as a collection alternative to a              
          proposed levy.  Section 7122(c) authorizes the Commissioner to              
          prescribe guidelines to determine when a taxpayer’s offer-in-               
          compromise should be accepted.  The applicable regulations,                 
          section 301.7122-1(b), Proced. & Admin. Regs., list three grounds           
          on which the Commissioner may accept an offer-in-compromise of a            
          Federal tax debt.  These grounds are “Doubt as to liability”,               
          “Doubt as to collectibility”, and to “Promote effective tax                 
          administration”.  Sec. 301.7122-1(b)(1), (2), and (3), Proced. &            
          Admin. Regs.  Petitioners reported on their Form 433-A that they            
          had assets worth $311,994.  Cochran determined that petitioners’            
          reasonable collection potential (taking into account their assets           
          as well as future income) was either $611,920 or $606,734.                  
          Petitioners can afford to pay their estimated $260,143 tax                  
          liability in full and do not argue that the liability is in                 
          doubt.  They seek to qualify for an offer-in-compromise to                  
          promote effective tax administration.  See sec. 301.7122-1(b)(3),           
          Proced. & Admin. Regs.; cf. Fargo v. Commissioner, 447 F.3d 706             

          external evidence in the record of this case to prove that                  
          Cochran abused her discretion by not considering facts and                  
          documents that they had consciously decided not to give to her.             
          Consistent with Murphy v. Commissioner, supra, we sustained                 
          respondent’s relevancy objections to the external evidence.                 
          Accord Clayton v. Commissioner, T.C. Memo. 2006-188; Barnes v.              
          Commissioner, T.C. Memo. 2006-150.                                          

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