{"meta":{"key":"d014--formula-02","task":"D014","title":"FORMULA-02 — Original worked-example repairs","parent_title":"Tax debt resolution and cancellation taxation","edition":"formula-02","path":"/research/d014--formula-02/","kind":"correction","category":"subject","role":"foundation","area_numbers":[19,67],"groups":["debt-types","collections"],"date":"2026-10-23","tables":3,"claims":7,"sources":7,"review_status":"revise","review_complete":true,"sha256":"39e82c84112aa4305df30d5ab9e5d03781e996dec5f10682b68aade35b2f53d5","headings":["1. Repaired original formulas","E01 — Insolvency exclusion with partially taxable COD","E02 — Why insufficient cash does not establish insolvency","E03 — Tax-attribute cost of excluded COD","E04 — Recourse foreclosure","E05 — Same property with nonrecourse debt","E06 — Joint debt with two full-value Forms 1099-C","E07 — Standard Form 656 OIC application cash","E08 — Three months of failure-to-pay penalties","2. Original-example disposition table","3. Source register and claim qualifications","Claim-level disposition","4. Residual publication holds","5. Researcher self-check"],"generation_provenance":{"actual_route":"regular_chat_adaptive_models","actual_model":"GPT-6","actual_mode":"Pro","provenance_limit":"Actual documented capture labels only; missing labels remain unknown. No preferred setting is inferred as actual execution."},"public_id":"D014/formula-02","facets":{"geography":["us"],"debt_type":["tax"],"stage":["bankruptcy"],"subject":["tax-cancellation","bankruptcy-insolvency"]},"scope":"","pending_corrections":0},"markdown":"# D014 FORMULA-02 — Original worked-example repairs\n\nBaseline: October 22, 2026 (America/Los_Angeles)\nCheck date: October 22, 2026, PDT\nRoute: Same regular Chat, GPT-6. No Deep Research invoked.\n\nScope: Repair the nine original examples supplied in this request, preserving their inputs, assumptions, amounts and original D014 claim IDs. This supplement does not replace or certify the parent research report.\n\nThe coordinator's October 22, 2026, 23:25:30 UTC arithmetic audit is retained as attributed evidence. The formulas below are independently recalculated from the supplied inputs. Mathematical correctness is distinguished from legal classification, tax eligibility and IRS acceptance.\n\n## 1. Repaired original formulas\n\n### E01 — Insolvency exclusion with partially taxable COD\n\nOriginal claims: D014-C035, D014-C037.\n\nAssume $80,000 unsecured debt, $30,000 settlement payment, actual cancellation of the remaining principal, $300,000 total liabilities and $270,000 asset fair market value immediately before cancellation. No higher-priority exclusion applies.\n\nPlain text\n```\nOriginal debt principal = $80,000\nSettlement payment = $30,000\n\nPotential cancellation-of-debt income\n= $80,000 - $30,000\n= $50,000\n\nImmediately-before liabilities = $300,000\nImmediately-before asset FMV = $270,000\n\nAmount of insolvency\n= $300,000 - $270,000\n= $30,000\n\nPotential insolvency exclusion\n= minimum($50,000, $30,000)\n= $30,000\n\nPotentially taxable COD income\n= $50,000 - $30,000\n= $20,000\n```\n\nArithmetic: Pass. Form 982 and subsequent tax-attribute reduction must be considered. Actual cancellation, inclusion of all relevant assets/liabilities, deductible amounts, secured property, joint debt and other exclusions remain factual/legal conditions. The $20,000 is potential gross income, not a calculated tax bill.\n\n### E02 — Why insufficient cash does not establish insolvency\n\nOriginal claim: D014-C035.\n\nPlain text\n```\nCash = $5,000\nOther assets at FMV = $100,000\n\nTotal immediately-before assets\n= $5,000 + $100,000\n= $105,000\n\nTotal immediately-before liabilities = $70,000\n\nLiabilities minus assets\n= $70,000 - $105,000\n= -$35,000\n\nInsolvency amount\n= maximum($0, -$35,000)\n= $0\n```\n\nArithmetic: Pass. The hypothetical taxpayer has positive net asset value of $35,000, despite only $5,000 cash. Retirement, investment and property interests require appropriate inclusion and valuation; the example does not establish how every actual interest is classified.\n\n### E03 — Tax-attribute cost of excluded COD\n\nOriginal claim: D014-C037.\n\nAssume $20,000 excluded COD, $12,000 reducible NOL, sufficient eligible general-business-credit carryover and no depreciable-property-basis-first election.\n\nPlain text\n```\nExcluded COD = $20,000\nReducible NOL = $12,000\n\nNOL reduction\n= minimum($20,000, $12,000)\n= $12,000\n\nExcluded COD remaining for subsequent attributes\n= $20,000 - $12,000\n= $8,000\n\nCredit reduction rate = 1/3 dollar per $1\n\nIllustrative general-business-credit reduction\n= $8,000 × (1 ÷ 3)\n= $2,666.666666...\n\nRounded illustrative credit reduction\n= $2,666.67\n```\n\nArithmetic: Pass to cents. The $2,666.67 figure is a mathematical illustration; the exact tax-return amount may require statutory rounding conventions. Credit availability, ordering, relevant tax-year attributes and elections must be verified. The credit reduction is not an immediate $2,666.67 cash tax.\n\n### E04 — Recourse foreclosure\n\nOriginal claim: D014-C043.\n\nAssume recourse debt of $250,000, property FMV of $200,000, adjusted basis of $180,000 and complete cancellation of the $50,000 deficiency. Ignore selling expenses and special home provisions.\n\nPlain text\n```\nRecourse mortgage balance = $250,000\nProperty FMV at transfer = $200,000\nAdjusted property tax basis = $180,000\n\nDisposition amount realized (assumed)\n= $200,000\n\nDisposition gain\n= $200,000 - $180,000\n= $20,000 gain\n\nPotential canceled deficiency\n= $250,000 - $200,000\n= $50,000 potential COD\n```\n\nArithmetic: Pass. The $20,000 is a gain, not a loss. The $50,000 is separately evaluated for COD treatment and exclusions. Recourse classification, actual debt discharge, transfer consideration, basis and property-use rules are legal/factual prerequisites.\n\n### E05 — Same property with nonrecourse debt\n\nOriginal claim: D014-C044.\n\nPlain text\n```\nNonrecourse debt satisfied by foreclosure = $250,000\nProperty FMV = $200,000\nAdjusted property tax basis = $180,000\n\nAssumed amount realized\n= $250,000\n\nDisposition gain\n= $250,000 - $180,000\n= $70,000 gain\n\nSeparate COD from this assumed nonrecourse foreclosure\n= $0\n```\n\nArithmetic: Pass. Under the assumed nonrecourse foreclosure classification, the full discharged debt enters amount realized, rather than separating a $50,000 COD component. The $70,000 remains a disposition gain before any other applicable tax provisions. Debt classification and transaction structure require primary-authority confirmation before publication.\n\n### E06 — Joint debt with two full-value Forms 1099-C\n\nOriginal claim: D014-C040.\n\nAssume actual $40,000 cancellation, joint-and-several liability, and a fact-supported 60% allocation to A and 40% to B. A has $10,000 insolvency; B has $30,000.\n\nPlain text\n```\nTotal actual debt cancellation = $40,000\n\nDebtor A allocation\n= $40,000 × 0.60\n= $24,000\n\nDebtor B allocation\n= $40,000 × 0.40\n= $16,000\n\nAllocation cross-check\n= $24,000 + $16,000\n= $40,000\n\nA insolvency exclusion\n= minimum($24,000, $10,000)\n= $10,000\n\nA potentially taxable COD\n= $24,000 - $10,000\n= $14,000\n\nB insolvency exclusion\n= minimum($16,000, $30,000)\n= $16,000\n\nB potentially taxable COD\n= $16,000 - $16,000\n= $0\n```\n\nArithmetic: Pass. The original 60/40 allocation is preserved. Two information returns showing $40,000 each do not, by themselves, establish $80,000 aggregate taxable income. The 60/40 allocation must be independently supported by actual facts, applicable law and IRS guidance; it is not a default rule.\n\n### E07 — Standard Form 656 OIC application cash\n\nOriginal claim: D014-C010.\n\nAssume one non-low-income-certified individual Form 656 lump-sum offer of $15,000, with the standard $205 application fee.\n\nPlain text\n```\nProposed settlement offer = $15,000\nStandard application fee = $205\nInitial lump-sum payment rate = 20%\n\nInitial offer payment\n= $15,000 × 0.20\n= $3,000\n\nInitial cash submitted\n= $3,000 + $205\n= $3,205\n\nRemaining proposed offer payments\n= $15,000 - $3,000\n= $12,000\n\nTotal cash if accepted and fully paid\n= $3,205 + $12,000\n= $15,205\n```\n\nArithmetic: Pass. The $205 fee is separate from the proposed $15,000 compromise. This does not establish acceptance or eligibility.\n\nForm distinction: This example concerns the standard Form 656 procedure. July 2026 Form 656-L doubt-as-to-liability offers require neither the standard application fee nor an initial offer payment. The qualifying low-income exception under Form 656 is also separate.\n\n### E08 — Three months of failure-to-pay penalties\n\nOriginal claims: D014-C014, D014-C017.\n\nAssume $20,000 unpaid individual income tax, a timely filed return, three full chargeable months, unchanged principal, and eligibility for the reduced rate in the second scenario.\n\nPlain text\n```\nUnpaid tax = $20,000\nChargeable months = 3\n\nOrdinary monthly rate = 0.5%\nOrdinary penalty\n= $20,000 × 0.005 × 3\n= $300\n\nQualifying approved-installment monthly rate = 0.25%\nReduced-rate penalty\n= $20,000 × 0.0025 × 3\n= $150\n\nIllustrative difference\n= $300 - $150\n= $150\n```\n\nArithmetic: Pass. The 0.25% rate requires the statutory installment-agreement and timely-return conditions; merely applying for a plan is insufficient. Interest accrues separately. Actual chargeable months, payment timing, rate changes and relief may alter both amounts.\n\n## 2. Original-example disposition table\n\n| Original example | Claim IDs retained | Arithmetic | Legal/evidence status |\n| --- | --- | --- | --- |\n| E01 — Partial insolvency | C035, C037 | Pass: $50,000 COD; $30,000 exclusion; $20,000 potentially taxable | Partial: actual debt discharge, asset/liability scope and attribute reductions |\n| E02 — Underwater versus insolvent | C035 | Pass: $105,000 assets; $35,000 positive net worth | Partial: asset classification and valuation |\n| E03 — Attribute reduction | C037 | Pass: $12,000 NOL; $8,000 remainder; $2,666.67 illustrative credit reduction | Partial: ordering, available attributes and rounding |\n| E04 — Recourse foreclosure | C043 | Pass: $20,000 gain; $50,000 potential COD | Partial: debt classification, transfer and exclusion conditions |\n| E05 — Nonrecourse foreclosure | C044 | Pass: $70,000 gain | Partial: nonrecourse classification and transaction treatment |\n| E06 — Joint cancellation | C040 | Pass: 60/40 allocation; A $14,000 potentially taxable; B $16,000 excluded | Partial: allocation evidence and each debtor's eligibility |\n| E07 — Standard OIC | C010 | Pass: $3,205 initial cash | Answered for specified Form 656 mechanics; acceptance unverified |\n| E08 — Failure to pay | C014, C017 | Pass: $300 versus $150 | Answered for illustrative rates; actual account computation unverified |\n\nAll 19 original arithmetic checks supplied by the coordinator are consistent with the repaired formulas. This is not a finding that 19 legal propositions have been verified.\n\n## 3. Source register and claim qualifications\n\nNew supplement source IDs are distinct from the retained original IDs. Direct readings below were performed October 22, 2026 (PDT). IRS publications and webpages are official agency guidance; they are not controlling statutes or court opinions.\n\n| Source ID | Issuer, direct URL and pinpoint | Version / access / limits |\n| --- | --- | --- |\n| D014-FF-S001 | IRS, Publication 4681, [https://www.irs.gov/pub/irs-pdf/p4681.pdf](https://www.irs.gov/pub/irs-pdf/p4681.pdf?utm_source=chatgpt.com) — Insolvency, Insolvency Worksheet, Reduction of Tax Attributes, Foreclosures and Repossessions | Opened, 2025 return edition, November 19, 2025. Relevant to E01–E06; not comprehensive authority for 2026 transactions. irs.gov |\n| D014-FF-S002 | IRS, Topic 431, [https://www.irs.gov/taxtopics/tc431](https://www.irs.gov/taxtopics/tc431?utm_source=chatgpt.com) — canceled debt, reporting and recourse/nonrecourse distinction | Opened, live page; publication/effective date not established. E01, E04–E06. Internal Revenue Service |\n| D014-FF-S003 | IRS, Form 656-B, [https://www.irs.gov/pub/irs-pdf/f656b.pdf](https://www.irs.gov/pub/irs-pdf/f656b.pdf?utm_source=chatgpt.com) — Paying for Your Offer and Form 656 payment elections | Opened, revision April 2026. E07; no acceptance guarantee. irs.gov |\n| D014-FF-S004 | IRS, Failure to Pay Penalty, [https://www.irs.gov/payments/failure-to-pay-penalty](https://www.irs.gov/payments/failure-to-pay-penalty?utm_source=chatgpt.com) — How We Calculate the Penalty, Failure to Pay Amount Shown as Tax on Your Return | Opened, live page. E08; individual timely-return and approved-plan conditions explicitly stated. Internal Revenue Service |\n| D014-FF-S005 | OLRC, 26 USC §108, [https://uscode.house.gov/us/usc/119-118/t26/s108/](https://uscode.house.gov/us/usc/119-118/t26/s108/?utm_source=chatgpt.com) | Attempted; returned Page Not Found. No new statutory passage verified from this URL. |\n| D014-S010 | Treasury regulations, 26 CFR §§ 1.108-7 and 1.1017-1 | Prior SOURCE-02 partial verification only; not reopened here. Attribute ordering remains subject to complete regulatory review. |\n| D014-S022 | IRS penalty guidance bundle | Prior SOURCE-02 evidence reused; controlling §6651 applicability not newly verified here. |\n\nCoordinator evidence reuse: The arithmetic audit timestamp `2026-10-22T23:25:30.042416+00:00` and its 19 passing checks were provided directly in this request. The earlier SOURCE-02 findings were reused as existing conversation evidence, not represented as fresh openings.\n\n### Claim-level disposition\n\n| Original claim | Formula supported | Remaining limitation |\n| --- | --- | --- |\n| C035 | E01 and E02 insolvency arithmetic | Statutory asset/liability measurement and individual facts |\n| C037 | E01 and E03 attribute arithmetic | Complete §108(b), §1017 and regulation ordering |\n| C043 | E04 recourse calculations | Legal classification and actual disposition facts |\n| C044 | E05 nonrecourse calculation | Debt enforceability and applicable disposition rules |\n| C040 | E06 hypothetical 60/40 allocation | Joint liability, beneficial interests and reporting evidence |\n| C010 | E07 standard Form 656 application cash | Form 656-L and low-income exceptions must remain distinct |\n| C014, C017 | E08 ordinary/reduced penalty amounts | Timely filing, approved plan, account dates and relief |\n\n## 4. Residual publication holds\n\nThe corrected equations may be imported as illustrative arithmetic, with their assumptions and qualifications attached. The following remain held:\n\n1. COD classification: Actual cancellation, timing, principal versus interest, insolvency assets/liabilities, joint allocation and tax attributes.\n2. Foreclosure: Recourse/nonrecourse classification, basis, disposition amount, property-use rules and any applicable exclusions.\n3. OIC: Form 656 versus Form 656-L, low-income qualification, submission rules and IRS acceptance.\n4. Penalties: Return and tax type, full statutory requirements, dates, changing balances, relief and concurrent penalties.\n5. Parent report: All other claims, state/local rules, contracts, 2026 tax-year transitions and any unreconciled primary authorities.\n\nNext actions: Open the controlling §108 and §1017 provisions through a functioning official source; reconcile Publication 4681's examples to the actual 2026 law; verify the joint-debt allocation authority; and connect each repaired formula to the parent report's original claim-to-source register. Preserve the original example text as historical output and import these equations as a separately dated correction.\n\n## 5. Researcher self-check\n\nRecomputed: All supplied original numerical relationships, retaining the $20,000 recourse gain, $70,000 nonrecourse gain, 60/40 joint allocation, $3,205 standard OIC submission and $300/$150 penalty comparison.\n\nNewly opened: IRS Publication 4681, Topic 431, Form 656-B and the IRS failure-to-pay guidance. A direct OLRC §108 request failed and was not counted as verified.\n\nNot established: Complete controlling-law verification of E01–E06, actual taxpayer eligibility, full 2026 applicability, IRS acceptance or any parent-area publication approval.\n\nThis is a focused formula and evidence self-check, not an independent review. No local files were written, and no publication, contacts, purchases, account changes or private-data access occurred.\n\nEND D014 FORMULA-02\n\n","tables":[{"headers":[],"index":0,"links":[],"row_links":[[],[],[],[],[],[],[],[],[]],"rows":[["Original example","Claim IDs retained","Arithmetic","Legal/evidence status"],["E01 — Partial insolvency","C035, C037","Pass: $50,000 COD; $30,000 exclusion; $20,000 potentially taxable","Partial: actual debt discharge, asset/liability scope and attribute reductions"],["E02 — Underwater versus insolvent","C035","Pass: $105,000 assets; $35,000 positive net worth","Partial: asset classification and valuation"],["E03 — Attribute reduction","C037","Pass: $12,000 NOL; $8,000 remainder; $2,666.67 illustrative credit reduction","Partial: ordering, available attributes and rounding"],["E04 — Recourse foreclosure","C043","Pass: $20,000 gain; $50,000 potential COD","Partial: debt classification, transfer and exclusion conditions"],["E05 — Nonrecourse foreclosure","C044","Pass: $70,000 gain","Partial: nonrecourse classification and transaction treatment"],["E06 — Joint cancellation","C040","Pass: 60/40 allocation; A $14,000 potentially taxable; B $16,000 excluded","Partial: allocation evidence and each debtor's eligibility"],["E07 — Standard OIC","C010","Pass: $3,205 initial cash","Answered for specified Form 656 mechanics; acceptance unverified"],["E08 — Failure to pay","C014, C017","Pass: $300 versus $150","Answered for illustrative rates; actual account computation unverified"]]},{"headers":[],"index":1,"links":[{"href":"https://www.irs.gov/pub/irs-pdf/p4681.pdf?utm_source=chatgpt.com","text":"https://www.irs.gov/pub/irs-pdf/p4681.pdf"},{"href":"https://www.irs.gov/taxtopics/tc431?utm_source=chatgpt.com","text":"https://www.irs.gov/taxtopics/tc431"},{"href":"https://www.irs.gov/pub/irs-pdf/f656b.pdf?utm_source=chatgpt.com","text":"https://www.irs.gov/pub/irs-pdf/f656b.pdf"},{"href":"https://www.irs.gov/payments/failure-to-pay-penalty?utm_source=chatgpt.com","text":"https://www.irs.gov/payments/failure-to-pay-penalty"},{"href":"https://uscode.house.gov/us/usc/119-118/t26/s108/?utm_source=chatgpt.com","text":"https://uscode.house.gov/us/usc/119-118/t26/s108/"}],"row_links":[[],[{"href":"https://www.irs.gov/pub/irs-pdf/p4681.pdf?utm_source=chatgpt.com","text":"https://www.irs.gov/pub/irs-pdf/p4681.pdf"}],[{"href":"https://www.irs.gov/taxtopics/tc431?utm_source=chatgpt.com","text":"https://www.irs.gov/taxtopics/tc431"}],[{"href":"https://www.irs.gov/pub/irs-pdf/f656b.pdf?utm_source=chatgpt.com","text":"https://www.irs.gov/pub/irs-pdf/f656b.pdf"}],[{"href":"https://www.irs.gov/payments/failure-to-pay-penalty?utm_source=chatgpt.com","text":"https://www.irs.gov/payments/failure-to-pay-penalty"}],[{"href":"https://uscode.house.gov/us/usc/119-118/t26/s108/?utm_source=chatgpt.com","text":"https://uscode.house.gov/us/usc/119-118/t26/s108/"}],[],[]],"rows":[["Source ID","Issuer, direct URL and pinpoint","Version / access / limits"],["D014-FF-S001","IRS, Publication 4681, https://www.irs.gov/pub/irs-pdf/p4681.pdf — Insolvency, Insolvency Worksheet, Reduction of Tax Attributes, Foreclosures and Repossessions","Opened, 2025 return edition, November 19, 2025. Relevant to E01–E06; not comprehensive authority for 2026 transactions. \nirs.gov"],["D014-FF-S002","IRS, Topic 431, https://www.irs.gov/taxtopics/tc431 — canceled debt, reporting and recourse/nonrecourse distinction","Opened, live page; publication/effective date not established. E01, E04–E06. \nInternal Revenue Service"],["D014-FF-S003","IRS, Form 656-B, https://www.irs.gov/pub/irs-pdf/f656b.pdf — Paying for Your Offer and Form 656 payment elections","Opened, revision April 2026. E07; no acceptance guarantee. \nirs.gov"],["D014-FF-S004","IRS, Failure to Pay Penalty, https://www.irs.gov/payments/failure-to-pay-penalty — How We Calculate the Penalty, Failure to Pay Amount Shown as Tax on Your Return","Opened, live page. E08; individual timely-return and approved-plan conditions explicitly stated. \nInternal Revenue Service"],["D014-FF-S005","OLRC, 26 USC §108, https://uscode.house.gov/us/usc/119-118/t26/s108/","Attempted; returned Page Not Found. No new statutory passage verified from this URL."],["D014-S010","Treasury regulations, 26 CFR §§ 1.108-7 and 1.1017-1","Prior SOURCE-02 partial verification only; not reopened here. Attribute ordering remains subject to complete regulatory review."],["D014-S022","IRS penalty guidance bundle","Prior SOURCE-02 evidence reused; controlling §6651 applicability not newly verified here."]]},{"headers":[],"index":2,"links":[],"row_links":[[],[],[],[],[],[],[],[]],"rows":[["Original claim","Formula supported","Remaining limitation"],["C035","E01 and E02 insolvency arithmetic","Statutory asset/liability measurement and individual facts"],["C037","E01 and E03 attribute arithmetic","Complete §108(b), §1017 and regulation ordering"],["C043","E04 recourse calculations","Legal classification and actual disposition facts"],["C044","E05 nonrecourse calculation","Debt enforceability and applicable disposition rules"],["C040","E06 hypothetical 60/40 allocation","Joint liability, beneficial interests and reporting evidence"],["C010","E07 standard Form 656 application cash","Form 656-L and low-income exceptions must remain distinct"],["C014, C017","E08 ordinary/reduced penalty amounts","Timely filing, approved plan, account dates and relief"]]}],"claims":[{"claim_id":"D014-C035","claim_ids":["D014-C035"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C035","Formula supported":"E01 and E02 insolvency arithmetic","Remaining limitation":"Statutory asset/liability measurement and individual facts"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"},{"claim_id":"D014-C037","claim_ids":["D014-C037"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C037","Formula supported":"E01 and E03 attribute arithmetic","Remaining limitation":"Complete §108(b), §1017 and regulation ordering"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"},{"claim_id":"D014-C043","claim_ids":["D014-C043"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C043","Formula supported":"E04 recourse calculations","Remaining limitation":"Legal classification and actual disposition facts"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"},{"claim_id":"D014-C044","claim_ids":["D014-C044"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C044","Formula supported":"E05 nonrecourse calculation","Remaining limitation":"Debt enforceability and applicable disposition rules"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"},{"claim_id":"D014-C040","claim_ids":["D014-C040"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C040","Formula supported":"E06 hypothetical 60/40 allocation","Remaining limitation":"Joint liability, beneficial interests and reporting evidence"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"},{"claim_id":"D014-C010","claim_ids":["D014-C010"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C010","Formula supported":"E07 standard Form 656 application cash","Remaining limitation":"Form 656-L and low-income exceptions must remain distinct"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"},{"claim_id":"D014-C014","claim_ids":["D014-C014","D014-C017"],"record_kind":"original_claim_to_formula_mapping","area_numbers":[19,67],"researcher_record":{"Original claim":"C014, C017","Formula supported":"E08 ordinary/reduced penalty amounts","Remaining limitation":"Timely filing, approved plan, account dates and relief"},"coordinator_verification_status":"arithmetic_mapping_checked_classification_and_controlling_authority_held","coordinator_review":"[internal evidence reference]"}],"sources":[{"source_id":"D014-FF-S001","urls":["https://www.irs.gov/pub/irs-pdf/p4681.pdf","https://www.irs.gov/pub/irs-pdf/p4681.pdf?utm_source=chatgpt.com"],"researcher_record":{"Source ID":"D014-FF-S001","Issuer, direct URL and pinpoint":"IRS, Publication 4681, https://www.irs.gov/pub/irs-pdf/p4681.pdf — Insolvency, Insolvency Worksheet, Reduction of Tax Attributes, Foreclosures and Repossessions","Version / access / limits":"Opened, 2025 return edition, November 19, 2025. Relevant to E01–E06; not comprehensive authority for 2026 transactions. \nirs.gov"},"coordinator_verification_status":"researcher_opening_attributed_selected_prior_coordinator_reuse_only_application_held","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]"},{"source_id":"D014-FF-S002","urls":["https://www.irs.gov/taxtopics/tc431","https://www.irs.gov/taxtopics/tc431?utm_source=chatgpt.com"],"researcher_record":{"Source ID":"D014-FF-S002","Issuer, direct URL and pinpoint":"IRS, Topic 431, https://www.irs.gov/taxtopics/tc431 — canceled debt, reporting and recourse/nonrecourse distinction","Version / access / limits":"Opened, live page; publication/effective date not established. E01, E04–E06. \nInternal Revenue Service"},"coordinator_verification_status":"researcher_opening_attributed_selected_prior_coordinator_reuse_only_application_held","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]"},{"source_id":"D014-FF-S003","urls":["https://www.irs.gov/pub/irs-pdf/f656b.pdf","https://www.irs.gov/pub/irs-pdf/f656b.pdf?utm_source=chatgpt.com"],"researcher_record":{"Source ID":"D014-FF-S003","Issuer, direct URL and pinpoint":"IRS, Form 656-B, https://www.irs.gov/pub/irs-pdf/f656b.pdf — Paying for Your Offer and Form 656 payment elections","Version / access / limits":"Opened, revision April 2026. E07; no acceptance guarantee. \nirs.gov"},"coordinator_verification_status":"researcher_opening_attributed_selected_prior_coordinator_reuse_only_application_held","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]"},{"source_id":"D014-FF-S004","urls":["https://www.irs.gov/payments/failure-to-pay-penalty","https://www.irs.gov/payments/failure-to-pay-penalty?utm_source=chatgpt.com"],"researcher_record":{"Source ID":"D014-FF-S004","Issuer, direct URL and pinpoint":"IRS, Failure to Pay Penalty, https://www.irs.gov/payments/failure-to-pay-penalty — How We Calculate the Penalty, Failure to Pay Amount Shown as Tax on Your Return","Version / access / limits":"Opened, live page. E08; individual timely-return and approved-plan conditions explicitly stated. \nInternal Revenue Service"},"coordinator_verification_status":"researcher_opening_attributed_selected_prior_coordinator_reuse_only_application_held","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]"},{"source_id":"D014-FF-S005","urls":["https://uscode.house.gov/us/usc/119-118/t26/s108/","https://uscode.house.gov/us/usc/119-118/t26/s108/?utm_source=chatgpt.com"],"researcher_record":{"Source ID":"D014-FF-S005","Issuer, direct URL and pinpoint":"OLRC, 26 USC §108, https://uscode.house.gov/us/usc/119-118/t26/s108/","Version / access / limits":"Attempted; returned Page Not Found. No new statutory passage verified from this URL."},"coordinator_verification_status":"failed_statutory_retrieval_preserved_not_verified","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]"},{"source_id":"D014-S010","urls":[],"researcher_record":{"Source ID":"D014-S010","Issuer, direct URL and pinpoint":"Treasury regulations, 26 CFR §§ 1.108-7 and 1.1017-1","Version / access / limits":"Prior SOURCE-02 partial verification only; not reopened here. Attribute ordering remains subject to complete regulatory review."},"coordinator_verification_status":"historical_source02_assertion_unavailable_unreviewed_support_held","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]","effective_correction":"[internal evidence reference]"},{"source_id":"D014-S022","urls":[],"researcher_record":{"Source ID":"D014-S022","Issuer, direct URL and pinpoint":"IRS penalty guidance bundle","Version / access / limits":"Prior SOURCE-02 evidence reused; controlling §6651 applicability not newly verified here."},"coordinator_verification_status":"historical_source02_assertion_unavailable_unreviewed_support_held","coordinator_checked_at":"2026-10-23T03:31:05.412413+00:00","coordinator_review":"[internal evidence reference]","effective_correction":"[internal evidence reference]"}],"coverage":[{"topic":"E01 — Partial insolvency","researcher_record":{"Original example":"E01 — Partial insolvency","Claim IDs retained":"C035, C037","Arithmetic":"Pass: $50,000 COD; $30,000 exclusion; $20,000 potentially taxable","Legal/evidence status":"Partial: actual debt discharge, asset/liability scope and attribute reductions"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E02 — Underwater versus insolvent","researcher_record":{"Original example":"E02 — Underwater versus insolvent","Claim IDs retained":"C035","Arithmetic":"Pass: $105,000 assets; $35,000 positive net worth","Legal/evidence status":"Partial: asset classification and valuation"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E03 — Attribute reduction","researcher_record":{"Original example":"E03 — Attribute reduction","Claim IDs retained":"C037","Arithmetic":"Pass: $12,000 NOL; $8,000 remainder; $2,666.67 illustrative credit reduction","Legal/evidence status":"Partial: ordering, available attributes and rounding"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E04 — Recourse foreclosure","researcher_record":{"Original example":"E04 — Recourse foreclosure","Claim IDs retained":"C043","Arithmetic":"Pass: $20,000 gain; $50,000 potential COD","Legal/evidence status":"Partial: debt classification, transfer and exclusion conditions"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E05 — Nonrecourse foreclosure","researcher_record":{"Original example":"E05 — Nonrecourse foreclosure","Claim IDs retained":"C044","Arithmetic":"Pass: $70,000 gain","Legal/evidence status":"Partial: nonrecourse classification and transaction treatment"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E06 — Joint cancellation","researcher_record":{"Original example":"E06 — Joint cancellation","Claim IDs retained":"C040","Arithmetic":"Pass: 60/40 allocation; A $14,000 potentially taxable; B $16,000 excluded","Legal/evidence status":"Partial: allocation evidence and each debtor's eligibility"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E07 — Standard OIC","researcher_record":{"Original example":"E07 — Standard OIC","Claim IDs retained":"C010","Arithmetic":"Pass: $3,205 initial cash","Legal/evidence status":"Answered for specified Form 656 mechanics; acceptance unverified"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"},{"topic":"E08 — Failure to pay","researcher_record":{"Original example":"E08 — Failure to pay","Claim IDs retained":"C014, C017","Arithmetic":"Pass: $300 versus $150","Legal/evidence status":"Answered for illustrative rates; actual account computation unverified"},"coordinator_acceptance":"original_inputs_and_numeric_relationships_checked_legal_application_held","coordinator_review":"[internal evidence reference]"}],"annotations":{},"corrections":[],"resolved_corrections":[],"review_history":[]}