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additional refund checks, petitioner did not make any further
payments to Mr. Rudolph because he knew that Mr. Rudolph was then
under investigation by the authorities. Apparently so was
petitioner.
In December 1999, petitioner pleaded guilty to one count of
violating 18 U.S.C. sec. 201(c)(1)(A) (bribery of public
officials), and the corresponding judgment was entered in April
2000. Petitioner was sentenced to 3 months’ home detention and 3
years’ probation; petitioner also agreed--as a condition of his
probation--to cooperate with the IRS in the collection of “all
outstanding taxes, interest, and penalties.”
In April 2005, respondent sent petitioner a Form 4549,
Income Tax Examination Changes, showing the proposed changes to
petitioner’s income tax returns for 1992, 1993, and 1994. The
proposed changes resulted in a total balance due, including
interest and civil fraud penalties under section 6663, of
$39,645.20.3 Petitioner objected to imposition of the fraud
penalties but agreed to the adjustments related to the
underpayments of tax.
While his objection to the fraud penalties was being
processed, petitioner submitted a Form 656, Offer in Compromise
(OIC), for all 3 tax years. In the OIC, petitioner offered to
3 The interest owed was calculated only to May 25, 2005,
and the penalty calculations were made only to Apr. 25, 2005.
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Last modified: November 10, 2007