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Given the amount of information, it would be unreasonable to put
the burden on Ms. Cochran to specifically address in the notice
of determination every single asserted fact, circumstance, and
argument presented. The fact that all of the information was not
specifically addressed in the notice of determination was not an
abuse of discretion.
b. Petitioner’s Reasonable Collection Potential
Petitioner asserts that Ms. Cochran erroneously determined
his reasonable collection potential by: (1) Considering 85
months of petitioner’s future income instead of 48 months; (2)
failing to adequately consider petitioner’s and Mrs. Johnson’s
age, health, retirement status, medical costs, and the likelihood
of future increases in medical and housing costs; and (3)
erroneously redetermining the value of petitioner’s assets and
the amount of his expenses. Petitioner’s arguments are not
persuasive.
Section 5.8.5.5 of the IRM provides that, when a taxpayer
makes a cash offer to compromise an outstanding tax liability,
only 48 months of future income should be considered. Petitioner
made a cash offer, but Ms. Cochran used 85 months of future
income. At trial, Ms. Cochran acknowledged that she should have
used only 48 months of future income. Ms. Cochran recomputed
petitioner’s reasonable collection potential using 48 months and
determined that it was $442,338, instead of $456,881, as
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