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refusal to accept their offer-in-compromise was an abuse of
discretion because of their “special circumstances” of age and
health and postretirement anticipated earnings; that the offer-
in-compromise should have been accepted because factors such as
equity, hardship, and public policy warrant its acceptance to
promote effective tax administration; that the Commissioner
failed to establish sufficient guidelines for resolving
longstanding cases by such means as forgoing penalties and
interest that have accumulated as a result of delay in
determining the taxpayers’ liability; and that interest abatement
should have been considered during the section 6330 hearing.
Respondent contends that the offer-in-compromise petitioners
made was inadequate in view of their financial circumstances
analyzed by the settlement officer; that petitioners’ situation
is neither unique nor exceptional; that effective tax
administration would not be served by acceptance of the low
offer-in-compromise because it would undermine compliance by
other taxpayers; that some of the interest on petitioners’
liabilities had been abated (for 1981, 1982, and 1983); and that
petitioners’ abatement arguments relate only to the total amount
of the liability to be compromised.
Although the record includes six stipulations and over 400
exhibits, the parties agree that the overriding issues in this
case are indistinguishable from issues discussed in other cases,
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