- 60 -
period 1998 through 2004 (i.e., $7,154.68), rather than his
average monthly wage income for the three-year period 2002
through 2004, petitioner’s RCP would be $937,464.84.36 Peti-
tioner’s RCP as so calculated exceeds the amount (i.e., $139,776)
in petitioner’s June 24, 2005 offer-in-compromise that petitioner
offered to compromise, inter alia, petitioner’s unpaid liabili-
ties for 1990, 1991, 1992, 1994, 1996, 1997, and 2002. See IRM
pt. 5.8.1.1.3(3) (Sept. 1, 2005).
36The monthly average of petitioner’s wage income for 1998
through 2004 is $7,154.68. See supra note 32. Adding to that
amount petitioner’s other monthly income (i.e., $1,992) and
subtracting petitioner’s allowed monthly necessary living ex-
penses (i.e., $6,243) results in “excess” monthly income of
$2,903.68. That amount of “excess” monthly income multiplied by
48 months results in “future income” of $139,376.64. That amount
of “future income” plus the amount that the settlement officer
calculated as the “net realizable equity” component of peti-
tioner’s RCP (i.e., $798,088.20), which “net realizable equity”
component petitioner does not dispute in petitioner’s response,
results in a reasonable collection potential for petitioner of
$937,464.84. In this connection, we note that on Sept. 6, 2005,
the second offer specialist sent petitioner a letter and enclosed
with that letter a so-called Asset/Equity Table which showed a
fair market value of real estate owned by petitioner of $995,714,
a quick sale value of that real estate of the same amount,
encumbrances on that real estate of $625,000, and “net realizable
equity” with respect to that real estate of $370,714. However,
in a footnote next to those amounts the second offer specialist
indicated: “Encumbrances not documented - subject to further
valuation.” The notice of determination that the Appeals Office
issued to petitioner on Feb. 8, 2006, indicated, inter alia, that
petitioner had real estate with a fair market value of $995,714,
that that real estate had a quick sale value of $796,571.20 (or
80 percent of that fair market value), that any encumbrances with
respect to that real estate were “Not documented”, and that
petitioner’s total “net realizable equity” was $798,088.20. In
petitioner’s response, petitioner does not dispute the determina-
tion in the notice of determination of petitioner’s “net realiz-
able equity” of $798,088.20.
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