T.C. Memo. 2003-190
UNITED STATES TAX COURT
DANNY AND RUTH KOSBAR, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 5371-02. Filed July 1, 2003.
Danny Kosbar and Ruth Kosbar, pro sese.
Bryan E. Sladek, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
LARO, Judge: Petitioners petitioned the Court under section
6404(h) to review respondent’s determination not to abate
interest for 1990 and 1991. Following respondent’s concession
that respondent will abate interest for the 3-day period from
June 20 through 22, 2001, we determine whether respondent abused
his discretion under section 6404 by not abating more of the
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interest. We hold he did not. Unless otherwise indicated,
section references are to the applicable versions of the Internal
Revenue Code. Rule references are to the Tax Court Rules of
Practice and Procedure.
FINDINGS OF FACT
Some facts were stipulated. We incorporate herein by this
reference the parties’ stipulation of facts and the exhibits
submitted therewith. We find the stipulated facts accordingly.
Petitioners are husband and wife. They resided in Hastings,
Michigan, when their petition was filed with the Court.
Petitioners filed timely 1990 and 1991 joint Federal income
tax returns and paid the reported taxes. Respondent audited
those returns in 1993 and disallowed certain claimed business
expenses. Respondent’s disallowance of these expenses increased
petitioners’ tax liability for 1990 and 1991. Respondent also
determined during the audit that petitioners were liable for 1990
and 1991 accuracy-related penalties under section 6662(a).
On September 17, 1993, petitioners agreed to the assessment
of the amount of taxes and penalties determined by respondent.
Subsequently, on several occasions, petitioners offered to
respondent a compromise of the amount of those assessed amounts.
Respondent rejected each of these offers.
On December 28, 2000, petitioners filed with respondent
Forms 843, Claim for Refund and Request for Abatement, for 1990
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and 1991, requesting that unpaid interest and penalties be
abated. On November 1, 2001, respondent mailed to petitioners
respondent’s determination denying their claims as to the
abatement of interest.
OPINION
Pursuant to section 6404(e)(1), the Commissioner may abate
the assessment of interest on: (1) Any deficiency attributable
to any error or delay by an officer or employee of the Internal
Revenue Service in performing a ministerial act, or (2) any
payment of any tax described in section 6212(a) to the extent
that any error or delay in payment is attributable to the
officer’s or employee’s being erroneous or dilatory in performing
a ministerial act.1 The temporary regulations interpreting
section 6404(e) define a “ministerial act” as “a procedural or
mechanical act that does not involve the exercise of judgment or
discretion, and that occurs during the processing of a taxpayer’s
case after all prerequisites to the act, such as conferences and
review by supervisors, have taken place.” Sec. 301.6404-
2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163
1
Sec. 6404(e) was amended by sec. 301(a)(1) and (2) of the
Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1457
(1996), to permit the Commissioner to abate interest with respect
to an unreasonable error or delay resulting from managerial or
ministerial acts. That amendment does not apply here in that it
is effective for interest accruing with respect to deficiencies
for taxable years beginning after July 30, 1996. Id.
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(Aug. 13, 1987).2 We review for abuse of discretion respondent’s
determination denying an abatement of interest. See sec.
6404(i); Lee v. Commissioner, 113 T.C. 145, 149 (1999).
We find no abuse of discretion here. As we understand
petitioners’ sole argument as to respondent’s refusal to abate
interest, they are not liable for any of the disputed interest
because, they state, they are not liable for the taxes and
penalties upon which the interest accrues. We have no
jurisdiction in this case to decide that issue as framed by
petitioners. We acquire our jurisdiction over this case from
section 6404(h), and that section does not authorize us to decide
in this case whether taxes or penalties assessed by the
respondent are proper. Sec. 6404(b); Krugman v. Commissioner,
112 T.C. 230, 237 (1999); Woodral v. Commissioner, 112 T.C. 19,
21 nn. 4&6 (1999); cf. Estate of Wenner v. Commissioner, 116 T.C.
284, 288 n.2 (2001). Given that petitioners have not established
that respondent abused his discretion as to his determination of
the disputed interest, we sustain that determination.
2
The final regulations under sec. 6404, which were issued
on Dec. 18, 1998, do not apply here in that they generally apply
to interest accruing on deficiencies or payments of tax described
in sec. 6212(a) for taxable years beginning after July 30, 1996.
Sec. 301.6404-2(d)(1), Proced. & Admin. Regs.
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To reflect respondent’s concession,
Decision will be entered
under Rule 155.