- 14 - being administered in a fair and equitable manner; and (3) compromise of the liability would not undermine compliance by taxpayers with the tax laws. Sec. 301.7122-1(b)(3), Proced. & Admin. Regs. Petitioners proposed an offer-in-compromise based alternatively on doubt as to collectibility with special circumstances or effective tax administration. Petitioners offered to pay $60,400 to compromise their outstanding tax liability for 1981 through 1996, which totaled $345,145 at the time of the section 6330 hearing.9 Petitioners argued that collection of the full liability would create economic hardship and would undermine public confidence that the tax laws are being administered in a fair and equitable manner. Respondent determined that petitioners’ reasonable collection potential was $394,318 and that their offer-in-compromise did not meet the criteria for an offer-in-compromise based on either doubt as to collectibility with special circumstances or effective tax administration. 9 The Federal tax lien was filed to secure repayment of petitioners’ outstanding tax liability for 1981-86 only. Petitioners estimated that their outstanding tax liability for 1981-86 was $257,012. However, petitioners sought to compromise their outstanding tax liability for not only 1981-86, but also for 1987-96. To accurately compare their offer amount to their outstanding tax liability, we must therefore consider the total assessed amount for 1981-96, and not for only 1981-86.Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Next
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