T.C. Memo. 2002-315
UNITED STATES TAX COURT
CHRISTOPHER KILEY, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 6676-02L. Filed December 27, 2002.
Christopher Kiley, pro se.
Rollin G. Thorley and Robin Ferguson, for respondent.
MEMORANDUM OPINION
ARMEN, Special Trial Judge: This matter is before the Court
on respondent’s Motion For Summary Judgment And To Impose A
Penalty Under I.R.C. Section 6673, filed pursuant to Rule 121.1
Respondent contends that there is no dispute as to any material
1
Unless otherwise indicated, all section references are to
the Internal Revenue Code, as amended, and all Rule references
are to the Tax Court Rules of Practice and Procedure.
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fact with respect to this levy action and that respondent’s
determination to proceed with collection of petitioner’s
outstanding tax liabilities for 1995, 1997, and 1998 should be
sustained as a matter of law.
Summary judgment is intended to expedite litigation and
avoid unnecessary and expensive trials. Fla. Peach Corp. v.
Commissioner, 90 T.C. 678, 681 (1988). Summary judgment may be
granted with respect to all or any part of the legal issues in
controversy "if the pleadings, answers to interrogatories,
depositions, admissions, and any other acceptable materials,
together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that a decision may be
rendered as a matter of law." Rule 121(a) and (b); see
Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), affd.
17 F.3d 965 (7th Cir. 1994); Zaentz v. Commissioner, 90 T.C. 753,
754 (1988); Naftel v. Commissioner, 85 T.C. 527, 529 (1985). The
moving party bears the burden of proving that there is no genuine
issue of material fact, and factual inferences will be read in a
manner most favorable to the party opposing summary judgment.
Dahlstrom v. Commissioner, 85 T.C. 812, 821 (1985); Jacklin v.
Commissioner, 79 T.C. 340, 344 (1982).
As explained in detail below, there is no genuine issue as
to any material fact, and a decision may be rendered as a matter
of law. Accordingly, we shall grant respondent’s motion for
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summary judgment.
Background
The record establishes and/or the parties do not dispute the
following:
A. Petitioner’s Tax Liability for 1995
On or about April 15, 1996, Christopher Kiley (petitioner)
and his wife Sabrena S. Legere2 filed with respondent a joint
Federal income tax return, Form 1040PC, for the taxable year
1995. Petitioner listed his occupation as “waiter”, and his wife
listed her occupation as “cashier”.
On their return, petitioner and his wife reported adjusted
gross income in the amount of $41,874, consisting of wages and
tips in the amount of $39,590 and taxable pensions/annuities in
the amount of $2,284.3 After reduction for the standard
deduction and personal exemptions, petitioner and his wife
reported taxable income in the amount of $25,324 and a tax
liability in the amount of $4,143. After reduction for Federal
income tax withheld ($2,871), petitioner and his wife reported
the amount owed as $1,312, consisting of tax in the amount of
2
Ms. Legere did not file with the Court a petition for
lien or levy action. See infra G. Accordingly, she is not a
party to the present proceeding.
3
Petitioner and his wife attached to their return three
Forms W-2, Wage and Tax Statement, showing the payment of wages
and allocated tips, and one Form 1099-R, Distributions From
Pensions, Annuities, Retirement or Profit-Sharing Plans, etc.,
showing the payment of a taxable distribution.
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$1,272 and an “estimated tax penalty” (i.e., addition to tax
under section 6654(a)) in the amount of $40.
Petitioner and his wife did not enclose payment with their
return of the amount reported as owed on their return.
On May 20, 1996, respondent assessed the tax liability
reported by petitioner and his wife on their 1995 return (i.e.,
$4,143), together with the “estimated tax penalty” reported
therein. On that date, respondent also assessed (1) an addition
to tax under section 6651(a)(2) for failure to pay and (2)
statutory interest.
Petitioner and his wife satisfied their outstanding
liability for tax, additions to tax, and statutory interest
through a series of installment payments, which was completed in
July 1997.
By notice dated September 10, 1997, respondent determined a
deficiency in the Federal income tax of petitioner and his wife
for 1995 in the amount of $226.4 No petition for redetermination
was filed with the Court. See sec. 6213(a). Accordingly, on
February 9, 1998, respondent assessed the deficiency, together
with (1) an addition to tax under section 6652(b) for failure to
report tip income and (2) statutory interest. On that same day,
respondent sent petitioner and his wife a statutory notice of
4
The deficiency in income tax appears to have been based
principally (if not exclusively) on respondent’s determination
that petitioner underreported tip income for 1995.
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balance due, informing them that they had a liability for 1995
and requesting that they pay that liability. Petitioner and his
wife failed to pay the amount owing.
On October 15, 1999, respondent received from petitioner a
Form 1040X, Amended U.S. Individual Income Tax Return, for 1995.5
On line 1 of the Form 1040X, petitioner reduced adjusted gross
income from $41,874, the amount reported on his original return,
to “0". Similarly, on line 10 of the Form 1040X, petitioner
reduced his tax liability from $4,143, the amount reported on his
original return, to “0", and on line 23, he asked that $4,143 be
refunded to him. By way of explanation, petitioner wrote as
follows in Part II of the Form 1040X:
LINE #1: Due to ignorance, we reported as “income”
sources of income as being “income” itself, when in
fact, we had no statutory income tax to report.
LINE #10: Apart from #1 above, we also had no statutory
liability with respect to income taxes, and pursuant to
Code sec. 31(a)(1), we have a Constitutional right to
have the wage tax imposed in sec. 3402(a)(1) refunded
since it represents an unapportioned, direct tax on
wages and thus would be unconstitutional if we could
not have them refunded. Because of the misleading
caption on sec. 3402(a)(1), we did not realize that
what was deducted from our pay was not income tax, but
a direct tax on our wages.
Petitioner attached to the Form 1040X a two-page typewritten
statement that stated, in part, as follows:
5
Although the Form 1040X listed both the names of
petitioner and his wife, it was signed only by petitioner.
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I, Christopher Kiley, am submitting this as part of my
amended 1995 income tax return, even though I know that
no section of the Internal Revenue Code:
1) Establishes an income tax “liability” * * *;
2) Provides that income taxes “have to be paid on the
basis of a return” * * *.
3) In addition to the above, I am filing even though
the “Privacy Act Notice” as contained in a 1040 booklet
clearly informs me that I am not required to file. It
does so in at least two places.
a) In one place, it states that I need only
file a return for “any tax” I may be “liable”
for. Since no Code Section makes me “liable”
for income taxes, this provision notifies me
that I do not have to file an income tax
return.
* * * * * * *
5) Please note, that my 1995 return also constitutes a
claim for refund pursuant to Code Section 6402.
6) It should also be noted that I had “zero” income
according to the Supreme Court’s definition of income
(See Note #1) * * * .
7) I am also putting the IRS on notice that my 1995 tax
return and claim for refund does not constitute a
“frivolous” return pursuant to Code Section 6702. * * *
8) Moreover, since no assessment for 1995 income taxes
* * * has ever been made against me, the IRS has no
legal basis to hold the $4143 of my money it is now
holding for 1995 income taxes.
* * * * * * *
10) In addition, don’t notify me that the IRS is
“changing” my return, since there is not [sic] statute
that allows the IRS to do that. * * *
* * * * * * *
*NOTE #1: The word “income” is not defined in the
Internal Revenue Code. * * * But, as stated above, it
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can only be a derivitive [sic] of corporate activity.
* * *
By letter dated November 10, 1999, respondent’s Chief of the
Examination Branch in the Ogden, Utah Service Center advised
petitioner and his wife that the Form 1040X was a frivolous
document and that “The position you have taken has no basis in
law”.
By letter dated January 7, 2000, petitioner replied to the
foregoing letter, stating in part as follows:
Your letter of 11/10/99 (attached) identifies you
as being Chief, Examination Branch. However, IRS
Manual * * * defines the duties of the “examination
branch,” in part, as follows:
“The Examination Branch administers an
international examination program involving the
selection and examination of all types of Federal tax
returns filed with the Assistant Commissioner
(International) ...”
Since I am not involved in international commerce,
and since I never filed tax returns with the Assistant
Commissioner (International), and since I am not living
abroad, nor engaged in making an offer and compromise,
nor am I an IRS informant claiming a reward - I can
find no provision in paragraph 1132.74 that would
authorize you to contact me on any basis. This, of
course, means that I do not even have to comment
further on your ludicrous, unauthorized and
extortionary letter, but I will do so anyway - because
I can not allow the fraud and deceit it contains to go
un-addressed.
* * * * * * *
If I am wrong in my assumption that no provision
of the Internal Revenue Code makes me “liable” for
income taxes * * *, then please identify any such
section for me. I note that your new “Mission
Statement” says that the IRS is supposed to help
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taxpayers “understand and meet (their) tax
responsibilities and by applying the tax law with
integrity and fairness to all.” Well you can start off
by showing me the “tax law” that makes me “liable” for
income taxes, since I cannot find it on my own. * * *
Constitutionally yours,
/s/ Christopher Kiley
Law Abiding Citizen
By letter dated February 4, 2000, respondent formally denied
the claim for refund made by petitioner in his Form 1040X.
B. Petitioner’s Tax Liability for 1997
On April 17, 1999, petitioner and his wife submitted to
respondent a joint Form 1040, U.S. Individual Income Tax Return,
for the taxable year 1997. On the Form 1040, petitioner listed
his occupation as “cashier”; petitioner’s wife did not list her
occupation.
Petitioner and his wife entered zeros on every line of the
income portion of the Form 1040, specifically including line 7
for wages and tips, line 22 for total income, lines 33 and 34 for
adjusted gross income, and line 39 for taxable income.
Petitioner and his wife also entered zeros on line 40 for tax and
on line 56 for total tax. Petitioner and his wife then claimed a
refund in the amount of $731.22, which was equal to the amount of
Federal income tax that had been withheld from petitioner’s
wages, as discussed in the following paragraph.
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Petitioner and his wife attached to their Form 1040 a Form
W-2, Wage and Tax Statement, disclosing the payment of wages to
petitioner during 1997. The Form W-2 was from Palace Station
Hotel and Casino in Las Vegas, Nevada; it disclosed the payment
of wages to petitioner in the amount of $19,989.32 and the
withholding of Federal income tax in the amount of $731.22.
Petitioner and his wife also attached to their Form 1040 a
two-page typewritten statement that began, as follows:
I, Christopher Kiley, am submitting this as a part of
my 1997 income tax return, even though I know that no
section of the Internal Revenue Code:
The rest of the statement was essentially the same as the
statement attached to petitioner’s Form 1040X for 1995. See
supra A.
By letter dated May 21, 1999, respondent‘s Chief of the
Examination Branch in the Ogden, Utah Service Center advised
petitioner and his wife that “the information you sent”, i.e.,
their Form 1040 for 1997 (as well as their Form 1040 for 1998,
see infra C), “is frivolous and your position has no basis in
law.”
By letter dated June 19, 1999, petitioner replied to the
foregoing letter. Although petitioner’s letter was much
lengthier than his previously described letter dated January 7,
2000 (see supra A), the tenor of the two letters was the same.
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By notice dated February 25, 2000, respondent determined a
deficiency in the Federal income tax of petitioner and his wife
for 1997 in the amount of $2,951, together with an accuracy-
related penalty under section 6662(a) and (b)(1) in the amount of
$247.16.6 No petition for redetermination was filed with the
Court. See sec. 6213(a). Accordingly, on August 7, 2000,
respondent assessed the deficiency, together with the accuracy-
related penalty and statutory interest. On that same day,
respondent sent petitioner and his wife a statutory notice of
balance due, informing them that they had a liability for 1997
and requesting that they pay that liability. Petitioner and his
wife failed to pay the amount owing.
C. Petitioner’s Tax Liability for 1998
On April 15, 1999, petitioner and his wife submitted to
respondent a joint Form 1040, U.S. Individual Income Tax Return,
for the taxable year 1998. On the Form 1040, petitioner listed
6
The deficiency in income tax was based on respondent’s
determination that petitioner and his wife received, but failed
to report: (1) Wages in the amount of $19,989 from Palace Station
Hotel and Casino; (2) wages in the amount of $16,419 from Lucky
Stores; (3) wages in the amount of $759 from UFCE Local 711; (4)
gambling winnings in the amount of $1,429 from Palace Station
Hotel and Casino; and (5) a capital gain in the amount of $1,250
from Chicago Trust.
We note that respondent has credited petitioner and his wife
for the amount withheld from wages insofar as their ultimate tax
liability is concerned. However, we note further that the
determination of a statutory deficiency does not take such amount
into account. See sec. 6211(b)(1).
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his occupation as “cashier”, and petitioner’s wife listed her
occupation as “unemployed”.
Petitioner and his wife entered zeros on every line of the
income portion of the Form 1040, specifically including line 7
for wages and tips, line 22 for total income, lines 33 and 34 for
adjusted gross income, and line 39 for taxable income.
Petitioner and his wife also entered zeros on line 40 for tax and
on line 56 for total tax. Petitioner and his wife then claimed a
refund in the amount of $1,178.72, which was equal to the amount
of Federal income tax that had been withheld from petitioner’s
wages, as discussed in the following paragraph.
Petitioner and his wife attached to their Form 1040 a Form
W-2, Wage and Tax Statement, disclosing the payment of wages to
petitioner during 1998. The Form W-2 was from Palace Station
Hotel and Casino in Las Vegas, Nevada; it disclosed the payment
of wages to petitioner in the amount of $18,823.15 and the
withholding of Federal income tax in the amount of $1,178.72.
Petitioner and his wife also attached to their Form 1040 a
two-page typewritten statement that began, as follows:
I, Christopher Kiley, am submitting this as a part of
my 1998 income tax return, even though I know that no
section of the Internal Revenue Code:
The rest of the statement was essentially the same as the
statement attached to petitioner’s Form 1040X for 1995 and Form
1040 for 1997. See supra A and B.
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As previously stated (see supra B), by letter dated May 21,
1999, respondent‘s Chief of the Examination Branch in the Ogden,
Utah Service Center advised petitioner and his wife that “the
information you sent”; i.e., their Form 1040 for 1998, “is
frivolous and your position has no basis in law.” Also as
previously stated (see supra B), by letter dated June 19, 1999,
petitioner replied to the foregoing letter. Although
petitioner’s letter was much lengthier than his previously
described letter dated January 7, 2000 (see supra A), the tenor
of the two letters was the same.
By notice dated February 25, 2000, respondent determined a
deficiency in the Federal income tax of petitioner and his wife
for 1998 in the amount of $16,174, together with an accuracy-
related penalty under section 6662(a) and (b)(1) in the amount of
$3,830.06.7 No petition for redetermination was filed with the
Court. See sec. 6213(a). Accordingly, on August 7, 2000,
7
The deficiency in income tax was based on respondent’s
determination that petitioner and his wife received but failed to
report: (1) Wages in the amount of $14,466 from Lucky Stores, and
(2) a capital gain in the amount of $83,550. In determining the
deficiency, it would appear that respondent failed to consider
the Form W-2 issued by Palace Station Hotel and Casino reporting
the payment of wages to petitioner in the amount of $18,823.15,
as discussed in the text. If this were the case, the deficiency
in income tax and the accuracy-related penalty were understated.
We note that respondent has credited petitioner and his wife
for the amount withheld from wages insofar as their ultimate tax
liability is concerned. However, we note further that the
determination of a statutory deficiency does not take such amount
into account. See sec. 6211(b)(1).
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respondent assessed the deficiency, together with the accuracy-
related penalty and statutory interest. On that same day,
respondent sent petitioner and his wife a statutory notice of
balance due, informing them that they had a liability for 1998
and requesting that they pay that liability. Petitioner and his
wife failed to pay the amount owing.
D. Respondent’s Final Notices and Petitioner’s Responses
On November 16, 2000, respondent mailed to petitioner and
his wife a Final Notice--Notice of Intent to Levy and Notice of
Your Right to a Hearing in respect of their outstanding tax
liabilities for 1997 and 1998 (but not 1995). Thereafter, on
December 12, 2000, respondent received from petitioner a Form
12153, Request for a Collection Due Process Hearing. Petitioner
attached to the Form 12153 a 2-page typewritten statement and a
copy of various Treasury regulations.
On April 28, 2001, respondent mailed to petitioner and his
wife a Final Notice--Notice of Intent to Levy and Notice of Your
Right to a Hearing (the final notice) in respect of their
outstanding tax liabilities for 1995, 1997, and 1998. The final
notice stated that the total amount then due from petitioner and
his wife was as follows:
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Year Amount Due
1995 $511.71
1997 2,020.53
1998 22,451.65
Total 24,983.89
No later than May 27, 2001, respondent received from
petitioner another Form 12153, Request for a Collection Due
Process Hearing. Petitioner attached to this Form 12153 the same
2-page typewritten statement and exhibit that he attached to his
previously filed Form 12153.8
The following passage from the statement attached to
petitioner’s Form 12153 reflects its tenor:
It is clear that before any appeals officer can
recommend the seizure of any property pursuant to Code
Section 6331 certain elements have to be present. For
one thing (pursuant to that statute) that person has to
statutorily “liable to pay” the taxes at issue, and
only after he “neglects or refuses to pay the same
within 10 days after notice and demand,” can his
property be subject to seizure. Therefore, apart from
the appeals officer having to identify the statute that
makes me “liable to pay” the taxes at issue, he needs
to have a copy of the “notice and demand” which I
“neglected” and “refused” to pay. In addition, I can’t
be “liable” to pay an income tax, if the tax in
question has never been assessed against me as required
by Code Sections 6201 and 6203. So I will need to see
a copy of the record of my assessments. And since (as
provided by Code Section 6201(a)(1) and IRS Transaction
Code 150) all assessments have to be based of filed
returns, I will have to see a copy of the return which
any claimed assessment is based.
8
As indicated in the text, neither Form 12153 was executed
by petitioner’s wife, nor did either purport to be filed on her
behalf.
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E. Respondent’s Efforts To Schedule an Administrative
Hearing
By letter dated October 23, 2001, an Appeals officer in
respondent’s Appeals Office in Albuquerque, New Mexico, scheduled
an administrative hearing for petitioner on December 17, 2001, in
Las Vegas, Nevada, the location closest to petitioner’s residence
in Pahrump, Nevada, in respect of the 3 taxable years in issue.
The penultimate paragraph of the Appeals officer’s letter stated
as follows:
IF YOU FAIL TO APPEAR FOR THE HEARING: This will be
your only opportunity for a face-to-face hearing. If
you cannot appear for the Hearing, I have scheduled a
telephone Hearing for you on January 15, 2002 at 9:00
A.M. (MST). Please call me on the scheduled date and
at the scheduled time if you cannot attend the face-to-
face hearing. If I do not hear from you by the date
scheduled for the telephone hearing, your hearing will
consist of a review of your administrative file and all
correspondence provided by you.
The Appeals officer included with his October 23, 2001, letter
Form 4340, Certificate of Assessments, Payments and Other
Specified Matters, for each of the 3 taxable years in issue.
Petitioner did not attend the December 17, 2001,
administrative hearing in Las Vegas, Nevada, nor did petitioner
participate in a telephone conference on January 15, 2002.
F. Respondent’s Notice of Determination
On February 14, 2002, respondent’s Appeals Office issued to
petitioner a Notice of Determination Concerning Collection
Action(s) Under Section 6320 and/or 6330 with regard to his tax
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liabilities for 1995, 1997, and 1998. In the notice, the Appeals
Office concluded that respondent’s determination to proceed with
collection by way of levy should be sustained.
G. Petitioner’s Petition and Amended Petition
On March 25, 2002, petitioner filed with the Court a
Petition for Lien or Levy Action seeking review of respondent’s
notice of determination.9 Thereafter, on June 19, 2002, an
Amended Petition for Lien or Levy Action was filed.
In the amended petition, petitioner challenges “the
appropriateness of (the) collection action” and “the existence of
the underlying liability”. Petitioner also alleges: (1) The
Appeals officer failed to obtain verification from the Secretary
that the requirements of applicable law or administrative
procedure were met as required under section 6330(c)(1); (2)
petitioner never received notice and demand for payment for the
liabilities in issue; and (3) no “valid” assessment was ever
made. Finally, petitioner alleges that he never received a
“valid notice of deficiency” for any of the years in issue. The
amended petition contains no facts in support of any of the
foregoing allegations.
H. Respondent’s Motion For Summary Judgment
As stated, respondent filed a Motion For Summary Judgment
9
At the time that the petition was filed, petitioner
resided in Pahrump, Nevada.
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And To Impose A Penalty Under I.R.C. Section 6673. Respondent
also filed a Declaration in support of the motion. Attached to
the Declaration are Forms 4340, Certificate of Assessments,
Payments and Other Specified Matters, for petitioner’s accounts
for 1995, 1997, and 1998. Together, the Forms 4340 show, inter
alia: (1) Assessments on February 9, 1998, in respect of the
taxable year 1995, and on August 7, 2000, in respect of the
taxable years 1997 and 1998; (2) the issuance of notices of
balance due on the dates of assessment for the corresponding
taxable year(s); and (3) the issuance of the final notice of
intent to levy on April 28, 2001. See supra A through D.
Petitioner filed an Objection to respondent’s motion,
disagreeing with the imposition of any penalty under section
6673. Thereafter, pursuant to notice, respondent’s motion was
called for hearing at the Court's motions session in Washington,
D.C. Petitioner did not attend the hearing, nor did he submit
any written statement pursuant to Rule 50(c).
Discussion
Section 6331(a) provides that if any person liable to pay
any tax neglects or refuses to pay such tax within 10 days after
notice and demand for payment, the Secretary is authorized to
collect such tax by levy on the person’s property. Section
6331(d) provides that at least 30 days before enforcing
collection by levy on the person's property, the Secretary is
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obliged to provide the person with a final notice of intent to
levy, including notice of the administrative appeals available to
the person.
Section 6330 generally provides that the Commissioner cannot
proceed with collection by levy until the person has been given
notice and the opportunity for an administrative review of the
matter (in the form of an Appeals Office hearing) and, if
dissatisfied, with judicial review of the administrative
determination. See Davis v. Commissioner, 115 T.C. 35, 37
(2000); Goza v. Commissioner, 114 T.C. 176, 179 (2000).
Section 6330(c) prescribes the matters that a person may
raise at an Appeals Office hearing. In sum, section 6330(c)
provides that a person may raise collection issues such as
spousal defenses, the appropriateness of the Commissioner's
intended collection action, and possible alternative means of
collection. Section 6330(c)(2)(B) provides that the existence
and amount of the underlying tax liability can be contested at an
Appeals Office hearing only if the person did not receive a
notice of deficiency for the tax in question or did not otherwise
have an earlier opportunity to dispute the tax liability. See
Sego v. Commissioner, 114 T.C. 604, 609 (2000); Goza v.
Commissioner, supra. Section 6330(d) provides for judicial
review of the administrative determination in the Tax Court or a
Federal District Court, as may be appropriate.
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A. Summary Judgment
In the amended petition, petitioner challenges “the
existence of the underlying tax liability”. Respondent contends
that petitioner is barred under section 6330(c)(2)(B) from
challenging the existence or amount of his underlying tax
liabilities in this collection review proceeding because
petitioner received notices of deficiency for the taxes in
question. Respondent deduces the factual predicate for this
contention from petitioner’s failure to deny receiving notices of
deficiency; rather, petitioner has only denied receiving “valid”
notices of deficiency. See Rennie v. Commissioner, T.C. Memo.
2002-296 (taxpayer’s denial of receiving “legal notice of
deficiency” did not mean that taxpayer failed to receive notice
of deficiency); Schmith v. Commissioner, T.C. Memo. 2002-252
(taxpayer’s denial of receiving “valid notice of deficiency” did
not mean that taxpayer failed to receive notice of deficiency);
see also Nestor v. Commissioner, 118 T.C. 162, 165-166 (2002)
(section 6330(c)(2)(B) bars a taxpayer from challenging the
existence or amount of the taxpayer’s underlying tax liability in
a collection review proceeding if the taxpayer received a notice
of deficiency and disregarded the opportunity to file a petition
for redetermination with this Court).
Rule 121(d) provides in relevant part as follows:
When a motion for summary judgment is made and
supported as provided in this Rule, an adverse party
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may not rest upon the mere allegations or denials of
such party’s pleading, but such party’s response, by
affidavits or as otherwise provided in this Rule, must
set forth specific facts showing that there is a
genuine issue for trial. If the adverse party does not
so respond, then a decision, if appropriate, may be
entered against such party.
In the amended petition, petitioner does not indicate on
what basis he challenges “the existence of the underlying
liability”. His failure to do so is contrary to Rule 331(b)(5),
requiring “Clear and concise lettered statements of the facts on
which the petitioner bases each assignment of error.” Cf. Parker
v. Commissioner, 117 F.3d 785 (5th Cir. 1997); White v.
Commissioner, T.C. Memo. 1997-459. Petitioner’s failure to do so
after the filing of respondent’s motion for summary judgment is
contrary to Rule 121(d) and justifies summary judgment for
respondent on this issue.10
Petitioner also challenges “the appropriateness of (the)
collection action”. Again, however, he fails to allege any facts
in support of this assignment of error. See Rule 331(b)(5).
Moreover, he fails to suggest any alternative means of
collection. See, e.g., sec. 6330(c)(2)(A)(iii). As before,
petitioner’s failure to do so after the filing of respondent’s
motion for summary judgment is contrary to Rule 121(d) and
10
Even if petitioner were permitted to challenge his
underlying tax liabilities, it is clear that the arguments he has
advanced (see supra Background, A through D) are frivolous and
groundless. E.g., Keene v. Commissioner, T.C. Memo. 2002-277.
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justifies summary judgment for respondent on this issue.
We likewise reject petitioner’s argument that the Appeals
officer failed to obtain verification from the Secretary that the
requirements of all applicable laws and administrative procedures
were met as required by section 6330(c)(1). The record shows
that the Appeals officer obtained and reviewed transcripts of
petitioner’s accounts for 1995, 1997, and 1998.
Federal tax assessments are formally recorded on a record of
assessment. Sec. 6203. “The summary record, through supporting
records, shall provide identification of the taxpayer, the
character of the liability assessed, the taxable period, if
applicable, and the amount of the assessment.” Sec. 301.6203-1,
Proced. & Admin. Regs.
Section 6330(c)(1) does not require the Commissioner to rely
on a particular document (e.g., the summary record itself rather
than transcripts of account) to satisfy the verification
requirement imposed therein. Roberts v. Commissioner, 118 T.C.
365, 371 n.10 (2002); Standifird v. Commissioner, T.C. Memo.
2002-245; Weishan v. Commissioner, T.C. Memo. 2002-88; Lindsey v.
Commissioner, T.C. Memo. 2002-87; Tolotti v. Commissioner, T.C.
Memo. 2002-86; Duffield v. Commissioner, T.C. Memo. 2002-53;
Kuglin v. Commissioner, T.C. Memo. 2002-51. In this regard, we
observe that the Forms 4340 furnished to petitioner by the
Appeals officer and attached to respondent’s Declaration
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contained all the information prescribed in section 301.6203-1,
Proced. & Admin. Regs. See Weishan v. Commissioner, supra;
Lindsey v. Commissioner, supra; Tolotti v. Commissioner, supra;
Duffield v. Commissioner, supra; Kuglin v. Commissioner, supra.11
Petitioner has not alleged any irregularity in the
assessment procedure that would raise a legitimate question about
the validity of the assessments or the information contained in
the Forms 4340. See Davis v. Commissioner, 115 T.C. at 41; Mann
v. Commissioner, T.C. Memo. 2002-48. Accordingly, we hold that
the Appeals officer satisfied the verification requirement of
section 6330(c)(1). Cf. Nicklaus v. Commissioner, 117 T.C. 117,
120-121 (2001).
Petitioner also contends that he never received a notice and
demand for payment of his tax liabilities for 1997 and 1998. The
requirement that the Secretary issue a notice and demand for
payment is set forth in section 6303(a), which provides in
pertinent part:
SEC. 6303(a). General Rule.-–Where it is not
otherwise provided by this title, the Secretary shall,
as soon as practicable, and within 60 days, after the
11
To the extent that petitioner may be arguing that the
Appeals officer failed to provide him with a copy of the
verification, we note that sec. 6330(c)(1) does not require that
the Appeals officer provide the taxpayer with a copy of the
verification at the administrative hearing. Nestor v.
Commissioner, 118 T.C. 162, 166 (2002); sec. 301.6330-1(e)(1),
Proced. & Admin Regs. In any event, both the Appeals officer and
respondent’s counsel provided petitioner with Forms 4340 for the
3 taxable years in issue.
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making of an assessment of a tax pursuant to section
6203, give notice to each person liable for the unpaid
tax, stating the amount and demanding payment thereof.
* * *
In particular, the Forms 4340 show that respondent sent
petitioner notices of balance due on the same dates that
respondent made assessments against petitioner for the taxes and
accuracy-related penalties determined in the notices of
deficiency. A notice of balance due constitutes a notice and
demand for payment within the meaning of section 6303(a). See,
e.g., Hughes v. United States, 953 F.2d 531, 536 (9th Cir. 1992);
Schaper v. Commissioner, T.C. Memo. 2002-203; Weishan v.
Commissioner, supra; see also Hansen v. United States, 7 F.3d
137, 138 (9th Cir. 1993). In addition, other notices were sent
to petitioner, at least one of which (the final notice, discussed
supra D) petitioner received; likewise, petitioner received the
Forms 4340. Such notices and forms were sufficient to constitute
notice and demand within the meaning of section 6303(a) because
they informed petitioner of the amount owed and requested
payment. Standifird v. Commissioner, supra; Hack v.
Commissioner, T.C. Memo. 2002-244; Hack v. Commissioner, T.C.
Memo. 2002-243; see Elias v. Connett, 908 F.2d 521, 525 (9th Cir.
1990) (“The form on which a notice of assessment and demand for
payment is made is irrelevant as long as it provides the taxpayer
with all the information required under 26 U.S.C. § 6303(a).”).
Finally, petitioner has failed to raise a spousal defense.
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Such potential issue is now deemed conceded. Rule 331(b)(4). In
the absence of a valid issue for review, we conclude that
respondent is entitled to judgment as a matter of law sustaining
the notice of determination dated February 14, 2002.
B. Imposition of a Penalty Under Section 6673
We turn now to that part of respondent’s motion that moves
for the imposition of a penalty on petitioner under section 6673.
As relevant herein, section 6673(a)(1) authorizes the Tax
Court to require a taxpayer to pay to the United States a penalty
not in excess of $25,000 whenever it appears that proceedings
have been instituted or maintained by the taxpayer primarily for
delay or that the taxpayer's position in such proceeding is
frivolous or groundless. The Court has indicated its willingness
to impose such penalty in lien and levy cases, Pierson v.
Commissioner, 115 T.C. 576, 580-581 (2000), and has in fact
imposed a penalty in a number of such cases.12
We are convinced that petitioner instituted the present
proceeding primarily for delay. In this regard, it is clear that
petitioner regards this proceeding as nothing but a vehicle to
12
E.g., Craig v. Commissioner, 119 T.C. (2002)
(imposing a penalty in the amount of $2,500); Roberts v.
Commissioner, 118 T.C. 365 (2002) (imposing a penalty in the
amount of $10,000); Rennie v. Commissioner, T.C. Memo. 2002-296
(imposing a penalty in the amount of $1,500); Tornichio v.
Commissioner, T.C. Memo. 2002-291 (imposing a penalty in the
amount of $12,500); Keene v. Commissioner, T.C. Memo. 2002-277
(imposing a penalty in the amount of $5,000), and numerous other
cases cited therein at n.14.
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protest the tax laws of this country and to espouse his own
misguided views, which we regard as frivolous and groundless.
E.g., Tolotti v. Commissioner, T.C. Memo. 2002-86. In short,
having to deal with this matter wasted the Court's time, as well
as respondent's, and taxpayers with genuine controversies may
have been delayed.
Under the circumstances, we shall grant that part of
respondent’s motion that moves for the imposition of a penalty in
that we shall impose a penalty on petitioner pursuant to section
6673(a)(1) in the amount of $5,000.
C. Conclusion
We have considered all of petitioner’s arguments that are
not discussed herein, and we find them to be without merit and/or
irrelevant.
In order to give effect to the foregoing,
An appropriate order granting
respondent's motion and decision
for respondent will be entered.