Case: ETA OIC Improperly Rejected Without Adequate Consideration of Economic Hardship or Public Policy Claims (T.C. Memo) (IRC §7122)

Rejection of Taxpayer’s effective tax administration (ETA) offer-in-compromise (OIC) was improper due to inadequate consideration of economic hardship claims and zero consideration of public policy/equity claims, the U.S. Tax Court held, remanding the case to IRS Appeals for further development. Taxpayer, an individual, submitted an ETA OIC for $100,000 to settle over $500,000 in tax liabilities and penalties, reasoning that government misconduct in a dismissed criminal case against him resulted in an improper $642,643 asset seizure that prevented him from paying his taxes, and that liquidating his rental properties would cause further economic hardship by eliminating his primary income source. ...