T.C. Memo. 2003-117
UNITED STATES TAX COURT
RAYMOND BOURBEAU, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 6898-02L. Filed April 22, 2003.
Raymond Bourbeau, pro se.
D. Sean McMahon, for respondent.
MEMORANDUM OPINION
VASQUEZ, Judge: This case is before the Court on
respondent’s motion for summary judgment and to impose a penalty
under I.R.C. section 66731 (motion for summary judgment).
1
Unless otherwise indicated, all section references are to
the Internal Revenue Code, and all Rule references are to the
Tax Court Rules of Practice and Procedure.
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Rule 121(a) provides that either party may move for summary
judgment upon all or any part of the legal issues in controversy.
Full or partial summary judgment may be granted only if it is
demonstrated that no genuine issue exists as to any material
fact, and a decision may be entered as a matter of law. Rule
121(b); Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520
(1992), affd. 17 F.3d 965 (7th Cir. 1994).
We conclude that there is no genuine issue as to any
material fact and that a decision may be rendered as a matter of
law.
Background
Petitioner filed his 1996, 1997, and 1998 Federal income tax
returns on April 15, 1997, August 18, 1998, and April 15, 1999,
respectively. Petitioner did not make any payments when he filed
his returns. Based on petitioner’s returns for 1996, 1997, and
1998, respondent assessed the following amounts:
Addition to
Tax for Addition to
Failure to Pay Tax for Assessment
Year Tax Estimated Tax Failure to Pay Interest Date
1996 $13,284 $707 $132.84 $158.14 06-02-1997
1997 12,634 681 379.02 448.00 09-21-1998
1998 16,141 339 96.16 82.54 05-24-1999
From November 1998 through March 2000, petitioner made 13
payments totaling $8,058 that respondent applied to petitioner’s
outstanding tax liability for 1996. Respondent also applied an
“overpaid credit” from 1995 to petitioner’s outstanding tax
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liability for 1996. Additionally, respondent applied “estimated
tax declarations” to petitioner’s outstanding tax liability for
1998 on April 16, 1998, June 16, 1998, September 17, 1998, and
February 20, 1999.
On or about February 24, 2001, respondent filed a Notice of
Federal Tax Lien (tax lien) regarding petitioner’s income tax
liabilities for 1996, 1997, and 1998 at the U.S. District Court
in Boston, Massachusetts. The tax lien listed the following
amounts owed as of the date of the tax lien:
Tax Period Type of Tax Amount Owed
1996 1040 $5,722.77
1997 1040 14,142.02
1998 1040 10,133.70
On March 1, 2001, respondent issued to petitioner a Notice
of Federal Tax Lien Filing and Your Right to a Hearing Under IRC
6320 (hearing notice) regarding his income tax liabilities for
1996, 1997, and 1998.
Petitioner submitted a Form 12153, Request for a Collection
Due Process Hearing (hearing request), regarding his 1996, 1997,
and 1998 tax years that respondent treated as being timely
submitted. In his explanation of why he did not agree with the
tax lien, petitioner stated:
I had no income for tax years 1996, 1997, 1998 that is
not exempt, eliminated, or excluded from gross income.
I understand that this may conflict with third party
reports which you may have in your files. Further,
whether or not I am required to file a tax return and
pay a tax is a factual matter for a trier of fact to
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determine. In order for a trier of fact to make a
determination there must be a trial at which evidence
and testimony is [sic] presented. As of this date
there has been no trial and no trier of fact has made
any determination. An employee of the IRS is not a
trier of fact and cannot make a determination as to
whether or not I am required to file a return and pay a
tax. For additional [sic] see the response letter
attached hereto and made a part hereof.
Petitioner included with his hearing request a three-page letter
containing frivolous arguments.
On February 11, 2002, Appeals Officer Maureen Jenkins sent
petitioner a letter informing him that an Appeals Office hearing
(hearing) was scheduled for his case on February 26, 2002, at the
Appeals Office in Boston, Massachusetts.
On February 26, 2002, petitioner attended the hearing.
Appeals Officer Jenkins and Appeals Team Manager Gene Peschier
were present at the hearing. Petitioner and respondent recorded
the hearing, and a court reporter transcribed the hearing. At
the hearing, petitioner called his “adviser”, Thomas Smith (who
was in Utah), twice on petitioner’s cell phone. Petitioner
repeatedly asked Appeals Officer Jenkins and Appeals Team Manager
Peschier to show him the delegation of authority from the
Secretary authorizing Appeals Officer Jenkins and Appeals Team
Manager Peschier to conduct the hearing. Petitioner did not
raise any other issues or arguments at the hearing.
At the hearing, Appeals Officer Jenkins reviewed
petitioner’s administrative file and transcripts of account for
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the years in issue, and she verified that all applicable laws and
administrative procedures had been met. Appeals Officer Jenkins
also provided petitioner copies of his transcripts of account for
the years in issue. Appeals Officer Jenkins provided petitioner
several opportunities to raise issues other than the delegation
of authority, including collection alternatives (such as an
installment agreement or an offer-in-compromise). Petitioner
stated that he was not interested in discussing collection
alternatives and that he wanted to terminate the hearing.
Respondent acceded to petitioner’s wishes, and the hearing ended.
On March 18, 2002, respondent issued a Notice of
Determination Concerning Collection Action(s) Under Section 6320
and/or 6330 (notice of determination) to petitioner regarding his
1996, 1997, and 1998 tax years. In the notice of determination,
respondent determined that (1) prior to the filing of the tax
lien, all statutory, administrative, and procedural requirements
had been met, (2) no viable collection alternatives were
established, and (3) the tax lien was not considered to be overly
intrusive.
On March 27, 2002, respondent mailed petitioner certified
certificates of assessments, payments, and other specified
matters for the years in issue.
On April 1, 2002, petitioner timely filed an imperfect
petition for lien or levy action under Code section 6320(c) or
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6330(d) seeking review of respondent’s determination to proceed
with collection of petitioner’s 1996, 1997, and 1998 tax
liabilities.
On April 2, 2002, the Court ordered petitioner to file a
proper amended petition on or before April 30, 2002. Attached to
the order were our Rules pertaining to lien and levy actions.
On May 6, 2002, petitioner filed an amended petition for
lien or levy action under Code section 6320(c) or 6330(d).
Attached to the amended petition are, among other things, a
transcript of the hearing and copies of petitioner’s transcripts
of account for the years in issue.
On February 21, 2003, respondent filed the motion for
summary judgment. Attached as exhibits to the motion for summary
judgment, among other things, are the transcript of the hearing
and transcripts of petitioner’s accounts for 1996, 1997, and
1998.
On February 24, 2003, the Court ordered petitioner to file a
response to respondent’s motion for summary judgment on or before
March 14, 2003. Petitioner did not file a response to
respondent’s motion for summary judgment.
Discussion
Section 6320 provides that the Secretary shall furnish the
person described in section 6321 with written notice (i.e., the
hearing notice) of the filing of a notice of lien under section
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6323. Section 6320 further provides that the taxpayer may
request administrative review of the matter (in the form of a
hearing) within a prescribed 30-day period. The hearing
generally shall be conducted consistent with the procedures set
forth in section 6330(c), (d), and (e). Sec. 6320(c).
The petition in this case is an eight-page document filled
with frivolous and groundless arguments. It is unclear in the
petition whether petitioner raises the issue of his underlying
liabilities. If he did, petitioner is precluded from challenging
his underlying tax liabilities in the instant proceeding because
he did not challenge them at the hearing. Tabak v. Commissioner,
T.C. Memo. 2003-4; see Miller v. Commissioner, 115 T.C. 582, 589
n.2 (2000), affd. 21 Fed. Appx. 160 (4th Cir. 2001); sec.
301.6320-1(f)(2), Q&A-F5, Proced. & Admin. Regs.; see also sec.
301.6330-1(f)(2), Q&A-F5, Proced. & Admin. Regs.
Where the validity of the underlying tax liability is not
properly in issue, we review respondent’s determination for an
abuse of discretion. Sego v. Commissioner, 114 T.C. 604, 610
(2000).
Petitioner appears to argue that at the hearing he was not
provided documents demonstrating that the verification
requirement of section 6330 had been met. At the hearing, the
Commissioner is not required to provide the taxpayer with a copy
of verification that the requirements of any applicable law or
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administrative procedure has been met. Nestor v. Commissioner,
118 T.C. 162, 166-167 (2002). In any event, respondent gave
petitioner copies of his transcripts of account for the years in
issue at, and subsequent to, the hearing.
We have repeatedly held that the Commissioner may rely on
transcripts of account to satisfy the verification requirement of
section 6330(c)(1). E.g., Eiselstein v. Commissioner, T.C. Memo.
2003-22. Petitioner has not alleged any irregularity in the
assessment procedure that would raise a question about the
validity of the assessments or the information contained in the
transcripts of account. Davis v. Commissioner, 115 T.C. 35, 41
(2000); Mann v. Commissioner, T.C. Memo. 2002-48. Accordingly,
we hold that the verification requirement of section 6330(c)(1)
has been satisfied. Cf. Nicklaus v. Commissioner, 117 T.C. 117,
120-121 (2001).
Petitioner claims in the petition that he was not accorded a
hearing that complied with section 6330 because as part of the
hearing he was not able to summon witnesses, cross-examine
witnesses, conduct discovery, examine documents, or obtain
evidence from respondent. We have repeatedly held that section
6330 hearings are informal, and that the compulsory attendance of
witnesses or production of documents is not required. Katz v.
Commissioner, 115 T.C. 329, 337 (2000); Davis v. Commissioner,
supra at 41-42.
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Petitioner has failed to raise a spousal defense, make a
valid challenge to the appropriateness of respondent’s intended
collection action, or offer alternative means of collection.
These issues are now deemed conceded. Rule 331(b)(4).
Accordingly, we conclude that respondent did not abuse his
discretion, and we sustain respondent’s determination.
Section 6673(a)(1) authorizes this Court to require a
taxpayer to pay to the United States a penalty not to exceed
$25,000 if the taxpayer took frivolous positions in the
proceedings or instituted the proceedings primarily for delay.
In Pierson v. Commissioner, 115 T.C. 576, 581 (2000), we issued
an unequivocal warning to taxpayers concerning the imposition of
a penalty pursuant to section 6673(a) on those taxpayers who
abuse the protections afforded by sections 6320 and 6330 by
instituting or maintaining actions under those sections primarily
for delay or by taking frivolous or groundless positions in such
actions.
In the petition, petitioner raised frivolous arguments and
contentions that we have previously rejected and which we
conclude were interposed primarily for delay.2 This has caused
2
In the case at bar, petitioner appears to be following a
strategy similar to the one provided to him at the hearing by
Thomas Smith. Although these frivolous arguments may have been
provided by Mr. Smith, it was petitioner’s choice to follow this
bad advice, and petitioner must face the consequences of his
actions.
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the Court to waste its limited resources. Accordingly, we shall
impose a penalty of $5,000 pursuant to section 6673.
To reflect the foregoing,
An appropriate order and
decision will be entered.