In Uncategorized on 12/19/2018 at 15:49

One of the commonest bounces of collection alternatives at Appeals is failure to withhold or pay estimateds for years subsequent to the year(s) at issue; one has to come clean to be clean, or show poverty in the extreme.

Here’s Douglas Maitland Reid & Linda Marie Reid, Docket No. 17152-17L, filed 12/19/18. That’s Dr Linda Marie Reid to you, but it doesn’t help, as Doug is self-employed and they have four full (and maybe a fifth) years of tax due but withholdings under the 90% mark by a long way. See Order at p. 4 for the full rundown.

STJ Armen, The Judge With a Heart, observes in this designated hitter that the ASO offered the Reids an IA based on their own numbers, which they rejected.

“…IRS guidelines with respect to collection alternatives direct that the taxpayer must be in current compliance with filing and estimated payment obligations. Moreover, it is not an abuse of discretion for the ASO to decline to consider an installment agreement or offer-in-compromise where no specific collection alternative proposal is ever placed before the reviewing officer. Stated otherwise, it is the obligation of the taxpayer, not the reviewing officer, to start negotiations regarding collection alternatives by making in the first instance a specific proposal.

“Petitioners rejected the ASO’s initial proposed installment agreement… and ASO’s counter-proposal… on the grounds that petitioners could not afford to make the payments, even though the ASO’s counterproposal was based on the financial information provided by petitioners themselves.” Order, at p. 7.

Unless you’re truly destitute, there’s no free ride at a CDP.


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