According to Law360, The Internal Revenue Service rejected actor Wesley Snipes' offer to settle his tax debt by paying 4 % of what he owed. (AP).
“The [IRS] settlement officer did not abuse her discretion in determining that acceptance of [Snipe’s offer-in-compromise] was not in the best interest of the United States,” Judge Kerrigan said, effectively holding up the IRS’ filing of a tax lien.
Snipes had argued that an IRS settlement officer, who was unnamed in the court’s decision, had abused her discretion by excluding his allegedly dissipated assets and by not investigating his adviser, W. Johnson.
However, Judge Kerrigan disagreed, finding the settlement officer had followed the revenue agency’s published guidance, “spent considerable time and effort” to determine Snipes’ income, equity, assets and transfers of real property, and ultimately lowered the IRS’ estimate of what it thought it could reasonably collect from Snipes from nearly $17.5 million to about $9.6 million.
In addition, taxpayers in “collection due process” hearings do not have the authority to compel the IRS to conducted expedited investigations into third parties, and Snipes had failed to prove that he would suffer economic hardship as a result of having to fork over what the IRS thought he could reasonably pay, the judge said.
In February 2008, Snipes was convicted on three counts of tax fraud. He was acquitted on three other counts of willful failure to file returns for the years 2002 to 2004, and on counts of conspiracy to defraud the IRS and submitting a false claim.
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