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restaurant. Mr. Salazar had also begun collecting monthly Social
Security benefits. Mr. Conley determined that petitioners’
reasonable collection potential exceeded the outstanding
liabilities and thus rejected the offer-in-compromise. Mr.
Conley’s determination did not, however, address Mr. Salazar’s
claims that respondent was seeking to collect penalties and
interest assessed for the period while petitioners’ bankruptcy
petition was pending.
On October 18, 2006, respondent issued a Notice of
Determination and Collection Action Under Section 6320 and/or
6330 to Mr. Salazar regarding his employment tax liabilities.
Mr. Salazar then filed a second petition to this Court claiming
error in respondent’s determination to proceed with collection in
the case at docket No. 23547-06L. The second petition does not
allege any error with respect to respondent’s rejection of Mr.
Salazar’s second offer-in-compromise. Instead, Mr. Salazar again
alleges that respondent abused his discretion in failing to
revisit and accept petitioners’ original 2004 offer-in-
compromise. Mr. Salazar also alleges error by respondent in not
abating the penalties and interest assessed for the period while
petitioners’ bankruptcy petition was pending. Finally, Mr.
Salazar alleges that it was an error for respondent to apply the
bankruptcy proceeds to his individual employment tax liabilities
instead of petitioners’ joint income tax liabilities. The two
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