In a recent U.S. Tax Court decision, the IRS prevailed over a married couple that claimed the agency miscalculated their ability to pay. The taxpayers filed returns late for a couple of years, and the IRS assessed tax, plus interest. The taxpayers said they couldn’t pay the amount and requested an installment agreement and offer-in-compromise. After the IRS investigated their claim and made a collection offer, the couple asserted that the IRS minimized their expenses and inflated their income. They rejected the IRS’s plan but didn’t make a counteroffer. The court ruled for the IRS, stating it didn’t abuse its discretion in upholding notices of intent to levy. (TC Memo 2023-94)
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