Curtis B. Keene v. Commissioner

121 T.C. No. 2

UNITED STATES TAX COURT

CURTIS B. KEENE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 11604-02L. Filed July 8, 2003.

P filed a petition for levy action under sec.
6330(d), I.R.C., disputing R’s notice of determination
concerning collection action with respect to his 1991
tax liability on the ground that he was not permitted
by the IRS Appeals Office to make an audio recording of
his sec. 6330 hearing, in violation of sec. 7521(a)(1),
I.R.C. Subsequently, P filed an amended petition again
asserting his claimed right to audio record such
hearing. P had previously submitted documents to R in
his request for a collection due process hearing that
asserted several frivolous and groundless arguments. R
informed P by letter that he could make no audio
recording. P gave R the required advance request to
record. P appeared for the hearing but was told by R
that he could not record it. P decided that he did not
want to have a hearing if he could not record it, and
he left with his recording equipment. P contends that
sec. 7521(a)(1), I.R.C., provides him with the right to
audio record his sec. 6330 hearing because it
constitutes an “in-person interview”. R contends that
 - 2 -

P does not have a right to audio record the hearing
because it is not an “interview” within the meaning of
sec. 7521(a)(1), I.R.C.

Held, P is entitled, pursuant to sec. 7521(a)(1),
I.R.C., to make an audio recording of his sec. 6330
hearing with the Internal Revenue Service Appeals
Office.

Curtis B. Keene, pro se.

Rollin G. Thorley and Robin Ferguson, for respondent.

OPINION

DAWSON, Judge: This case was assigned to Special Trial

Judge Robert N. Armen, Jr., pursuant to the provisions of section

7443A(b)(4), and Rules 180, 181, and 182.1 The Court agrees with

and adopts the opinion of the Special Trial Judge, which is set

forth below.

OPINION OF THE SPECIAL TRIAL JUDGE

ARMEN, Special Trial Judge: This matter is before the Court

on respondent’s Motion for Summary Judgment, filed pursuant to

Rule 121. The only issue raised by the parties is whether,

pursuant to the provisions of section 7521(a)(1), petitioner is

entitled to audio record his section 6330 hearing with the

Internal Revenue Service Appeals Office.

1
All Rule references are to the Tax Court Rules of
Practice and Procedure, and, unless otherwise indicated, all
section references are to the Internal Revenue Code, as amended.
 - 3 -

Background

Petitioner was a resident of Las Vegas, Nevada, when he

filed his petition herein.

This case involves the 1991 tax year.2 Petitioner and his

spouse, Fanny Keene, filed a timely joint Federal income tax

return on which they reported wages of $32,047; taxable IRA

distributions of $21,996; taxable pensions and annuities of

$47,764; a business income loss of $48,483 on Schedule C from the

operation of Hizzoner’s Restaurant; and total tax of $9,327 with

Federal income tax withheld of $2,837, and tax owed of $6,845.

Respondent assessed the amount due as reported on the return. In

1992 and 1993 installment payments totaling $1,400 were made and

applied to the amount of tax assessed. On or about May 14, 1993,

petitioner filed for bankruptcy, and that proceeding was closed

on February 4, 1994. During the years 1995, 1996, and 1997,

overpaid credits totaling $552.97 were applied to the 1991 amount

assessed. Also in 1997, there was a subsequent payment by levy

of $523.17 and a miscellaneous payment of $494.22; both amounts

were applied to the 1991 income tax liability. Five payments of

$350 each were later made and applied to the 1991 tax liability.

2
See Keene v. Commissioner, T.C. Memo. 2002-277, in which
we granted the Commissioner’s motion for summary judgment
sustaining the determination to proceed with the collection of
the taxpayer’s Federal income tax liabilities for 1997 and 1998,
and imposed a penalty of $5,000 under sec. 6673(a)(1). That case
did not involve the sec. 7521(a)(1) audio recording issue
presented in the instant case.
 - 4 -

On or about February 10, 2001, a Form 1040X, Amended U.S.

Individual Income Tax Return, for the year 1991 was filed showing

that no income tax was due for that year and claiming a refund of

$2,837, which was the amount of Federal income tax withheld. The

explanation petitioner gave for filing the 1991 amended return

was:

Due to my ignorance, I mistakenly reported as “income”
what were actually “sources” of income. In addition,
the amounts that I incorrectly listed as “income” were,
in fact, amounts that are exempt from taxation.

There was a three-page attachment to the amended return in which

petitioner (not his spouse) made frivolous and groundless

arguments why he did not owe the assessed tax.

By letter dated April 25, 2001, the amended return and

attachment were determined by the Examination Branch, Ogden

Compliance Service Center, to be frivolous. On November 1, 2001,

after receiving additional groundless statements from petitioner,

the Director of IRS Compliance Services disallowed petitioner’s

claim for refund.

On January 21, 2002, respondent issued to petitioner a Final

Notice–-Notice Of Intent To Levy And Notice Of Your Right To A

Hearing with regard to petitioner’s unpaid Federal income tax for

1991.

On February 11, 2002, petitioner submitted to respondent a

Form 12153, Request for a Collection Due Process Hearing, which

attached a statement setting forth the following contentions:
 - 5 -

I never received a “notice and demand” for payment for
any 1991 income taxes.

I claim there is no underlying, statutory liability in
connection with the income taxes at issue.

I claim there is no statute requiring me “to pay” the
income taxes at issue.

No law authorizes the IRS to claim that I owe more in
income taxes than the “zero” I reported on my 1991
amended 1040X income tax return.

The IRS Decoding manual provides additional proof that
I cannot own more in 1991 income taxes than the “zero”
shown on my 1991 income tax return.

The Secretary has not authorized any action for the
collection of taxes and penalties as required by 26 USC
7401.

The Attorney General has not directed that any action
against me for the enforced collection of any income
taxes and penalties for the year 1991 “be commenced” as
is required by 26 USC 7401.

In addition to everything else, Sections 6331, 7701 and
7608 clearly establish that IRS Revenue Officers or
Revenue Agents have no authority to seize property in
payment of income taxes.

Petitioner concluded his statement with a declaration of his

intent to tape record the requested hearing.

By letter dated May 3, 2002, Appeals Officer Donna Fisher

(the Appeals officer) informed petitioner that his hearing was

scheduled for May 16, 2002. The Appeals officer’s letter also

stated:

Further, no audio or stenographic recordings are
allowed on Appeals cases effective as of May 2, 2002,
forward. Therefore, your request to tape record and/or
bring a court reporter to the Collection Due Process
hearing is denied.
 - 6 -

By letter dated May 10, 2002, petitioner informed the

Appeals Office that he would not be able to attend the hearing

scheduled for May 16, 2002, and requested that it be rescheduled.

Petitioner also requested that the Appeals officer provide him

with the statutory or regulatory authority barring him from

recording the hearing.

By letter dated May 14, 2002, the Appeals officer informed

petitioner that his hearing was rescheduled for June 3, 2002.

The Appeals officer also enclosed with her letter a copy of an

internal, apparently unpublished, Memorandum to All Appeals Area

Directors dated May 2, 2002, from the Acting Chief of the Office

of Appeals in Washington, D.C., which stated as follows:

Effective immediately, audio and stenographic
recordings will no longer be allowed on Appeals cases.
Taxpayers and/or representatives who have already
requested such recording will be informed of the change
in practice immediately, and advised that the request
cannot be allowed.

Prior to enactment of IRC 7521, Service Compliance
functions voluntarily allowed audio recordings.
Appeals decided to follow this practice at that time.
IRC 7521, enacted in 1988, provided for the allowance
of audio recordings of conferences relative to the
determination or collection of a tax, between the
taxpayer and the Internal Revenue Service, provided
that the Service was given at least ten (10) days
advance notice of the taxpayer’s intent to record the
conference.

Although Appeals makes liability and collectibility
determinations, Appeals’ procedures differ from
Examination and Collection function contacts that are
not discretionary for the taxpayer. Contact with
Appeals is discretionary for the taxpayer, and as such,
recording has always been discretionary for Appeals.
 - 7 -

It should also be noted that Appeals was deliberately
excluded in Notice 89-51 that dealt with the audio
recording provision, as Counsel determined that IRC
7521 was not applicable to Appeals.

Recently Appeals has had several incidents of audio
recordings being altered to imply Appeals employees
were making inappropriate comments. In some cases,
those altered recordings were broadcast on the radio.
We are also aware of instances where excerpts of
stenographic records were combined in inappropriate
ways and published in anti-tax newsletters and other
anti-government publications.

These actions have had the result of undermining the
appearance of Appeals’ competence, impeding Appeals
ability to adequately function in its role as a dispute
resolution function. These incidents have interfered
with our customers’ perception of our ability to carry
our Appeals’ mission to be fair and impartial in our
considerations; and therefore cannot be allowed to
continue.

In addition, Appeals has always been concerned that the
practice of recording conferences and hearings could
inappropriately interfere with the informal nature of
Appeals conferences, and therefore might improperly
impede settlement.

Therefore, the decision has been made to eliminate all
audio as well as stenographic recordings of Appeals
conferences and hearings. That decision is effective
immediately upon the date of this memorandum.

This memorandum supersedes guidance issued in Internal
Revenue Manual 8.7.2.3.4 and 8.6.1.2.5 on the subject
of recording hearings and conferences. The IRM will be
updated to reflect these changes during the next
regular update of that section.

On June 3, 2002, petitioner, after giving to the Appeals

Office his advance request to record, appeared for the hearing.

When the Appeals officer informed him that he would not be

permitted to use an audio recorder, petitioner decided that he
 - 8 -

did not want to have a hearing if he could not record it, so he

left with his recording equipment.

On June 11, 2002, respondent issued to petitioner a Notice

of Determination Concerning Collection Actions(s) Under Section

6320 and/or 6330. The notice of determination stated that

respondent determined that, after balancing the need for

efficient collection against petitioner’s arguments, it was

appropriate to proceed with the levy action.

On July 12, 2002, petitioner filed with the Court a timely

Petition for Lien or Levy Action. The only issue raised in the

petition pertains to the Appeals officer’s decision to preclude

petitioner from recording the hearing. The petition states in

pertinent part:

Petitioner states that the determination action by the
Appeals Office in this instant case was not only
inappropriate, biased and prejudiced, but also an
illegal action designed to deny the petitioner his due
process rights to make a full and complete official
record of a hearing with the government a potential
adversarial relationship.

On August 12, 2002, petitioner filed an Amended Petition

elaborating on his argument that he should have been permitted to

audio record the hearing.

After filing an answer to the amended petition, respondent

filed the motion for summary judgment that is pending before the

Court. Respondent maintains that there is no dispute as to

material facts and that he is entitled to judgment as a matter of
 - 9 -

law sustaining the notice of determination dated June 11, 2002.

Respondent’s position is that section 7521(a)(1),3 which

authorizes taxpayers to record “in-person interviews”, is not

applicable to hearings pertaining to collection actions under

section 6320 or 6330. Petitioner filed an objection to

respondent’s motion.

This matter was called for hearing at the Court’s motions

session held in Washington, D.C. Counsel for respondent appeared

at the hearing and was heard. Although there was no appearance

by or on behalf of petitioner at the hearing, he filed with the

3
Sec. 7521, which is entitled “Procedures Involving
Taxpayer Interviews”, provides in part:

SEC. 7521(a) Recording of Interviews.--

(1) Recording by Taxpayer.–-Any officer or
employee of the Internal Revenue Service in connection
with any in-person interview with any taxpayer relating
to the determination or collection of any tax shall,
upon advance request of such taxpayer, allow the
taxpayer to make an audio recording of such interview
at the taxpayer’s own expense and with the taxpayer’s
own equipment.

(2) Recording by IRS Officer or Employee.–-An
officer or employee of the Internal Revenue Service may
record any interview described in paragraph (1) if such
officer or employee--

(A) informs the taxpayer of such recording
prior to the interview, and

(B) upon request of the taxpayer, provides the
taxpayer with a transcript or copy of such recording
but only if the taxpayer provides reimbursement for the
cost of the transcription and reproduction of such
transcript or copy.
 - 10 -

Court a written statement pursuant to Rule 50(c) opposing

respondent’s motion on the ground that he was denied his request

to audio record his section 6330 hearing with the Appeals Office

under the provisions of section 7521(a)(1).

Discussion

Summary judgment is intended to expedite litigation and

avoid unnecessary and expensive trials. See 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(b); Sundstrand Corp. v.

Commissioner, 98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th

Cir. 1994).

Section 7521(a)(1) expressly states that, upon the advance

request of a taxpayer, an Internal Revenue Service officer or

employee shall permit the taxpayer to make an audio recording of

“any in-person interview * * * relating to the determination or

collection of any tax”. Neither section 7521(a)(1) nor the

legislative history4 directly and clearly defines or otherwise

4
See H. Conf. Rept. 100-1104 (Vol. II), at 212-214 (1988),
1988-3 C.B. 473, 702-704.
 - 11 -

describes the term “in-person interview”. Where a term is not

defined in the statute, it is appropriate to accord the term its

“ordinary meaning”. Northwest Forest Resource Council v.

Glickman, 82 F.3d 825, 833 (9th Cir. 1996). And when there is no

indication that Congress intended a specific legal meaning for

the term, courts may look to sources such as dictionaries for a

definition. Muscarello v. United States, 524 U.S. 125, 127-132

(1998); see also Huntsberry v. Commissioner, 83 T.C. 742, 747-748

(1984), in which the Court stated that “where a statute is clear

on its face, * * * we would require unequivocal evidence of

legislative purpose before construing the statute so as to

override the plain meaning of the words used therein.”

The term “interview” is defined by Webster’s Third New

International Dictionary Unabridged 1183-1184 (1993) as:

a meeting face to face: a private conversation; usu: a
formal meeting for consultation: CONFERENCE

Similar definitions appear in other dictionaries. For example,

the American Heritage Dictionary (4th ed. 1970) defines the term

“interview” as “a face to face meeting arranged for the

discussion of some matter”; Webster’s II New Riverside University

Dictionary 639 (1984) defines the term as “a formal face-to-face

meeting”; and Webster’s New Collegiate Dictionary 600 (1979)

defines the term as “a formal consultation” or “a meeting at

which information is obtained”.
 - 12 -

Petitioner contends that he is entitled to make an audio

recording of his section 6330 hearing before the Appeals Office

because the specific requirements of section 7521(a)(1) have been

satisfied. He stresses that the meeting is presided over by an

officer or employee of the IRS; that the meeting is “in person”;

that the meeting involves the collection of tax; that he gave

advance notice of his intent to record; and he brought his own

recording equipment for that purpose.5

To the contrary, respondent contends that petitioner has no

statutory right to audio record a section 6330 proceeding because

it is a “hearing”, as distinguished from an “interview”, and,

therefore, is not subject to the provisions of section

7521(a)(1). The distinction, respondent argues, is that an

“interview” is technically one initiated by the IRS that the

taxpayer is under some compulsion to attend and is for the

purpose of gathering information to use in the determination or

collection of tax. In respondent’s view, a taxpayer “interview”

5
Petitioner has cited and relied on several existing
sections of the Internal Revenue Manual, as well as Publication 1
entitled “Your Rights as a Taxpayer”, sec. IV, par. 2, sentence
2, which states that taxpayers “may make sound recordings of any
meeting with our examination, appeal, or collection personnel”.
Although we recognize that these are not statements of statutory
or regulatory rights, audio recordings by taxpayers of Appeals
conferences have been permitted since the early 1980s, and the
practice continued after the enactment of sec. 7521(a)(1) in 1988
and secs. 6320 and 6330 in 1998. It was not until May 2, 2002,
in its unpublished Memorandum to All Appeals Area Directors that
the Appeals Office began denying taxpayers the right to make
audio recordings in Appeals cases.
 - 13 -

by the Examination or Collection Division of the IRS is

involuntary and inquisitorial in nature and can be enforced by

the issuance of an administrative summons, but, by contrast, a

section 6330 hearing is voluntary on the taxpayer’s part.

There are several reasons why we conclude that petitioner is

entitled to audio record his section 6330 hearing with the

Appeals Office.

First, the distinction that respondent seeks to draw between

the terms “interview” and “hearing” in the context of section

6330 is, at best, tenuous and unpersuasive. As the general and

ordinary definitions of “interview” suggest, we think the

exchange of information that occurs between a taxpayer and an

Appeals officer during an administrative hearing conducted under

section 6330 constitutes an “in-person interview” within the

meaning of that term as used in section 7521(a)(1).

A section 6330 hearing provides a taxpayer with the

opportunity to raise any relevant issues under section 6330(c)(2)

relating to the proposed collection action, including appropriate

spousal defenses, challenges to the appropriateness of the

collection action, offers of collection alternatives, and, in

appropriate circumstances, challenges to the underlying tax

liability. During the administrative hearing, the taxpayer is

expected to offer documentation, proposals, and arguments and to

answer the Appeals officer’s inquiries regarding relevant issues.
 - 14 -

In turn, the administrative hearing provides the Appeals officer

with the opportunity to determine whether the Commissioner has

followed applicable laws and administrative procedures with

regard to the assessment and collection action in dispute and to

develop a record with respect to issues raised by the taxpayer.

In short, the meeting between the taxpayer and the Appeals

officer is face-to-face, private, arranged for the discussion of

specific matters, and formal in the sense that it is prescribed

by law.6 As previously indicated, these are all characteristics

of an “interview” as that term is commonly defined.

Second, we reject the distinction that respondent seeks to

draw between what he describes as the inquisitorial nature of a

taxpayer interview by the Examination or Collection Division and

the voluntary nature of a section 6330 hearing before the Appeals

Office. It is our view that the section 6330 hearing is an

integral part of the tax collection process and therefore relates

to the “collection of any tax” within the meaning of section

7521(a)(1). After all, the Commissioner generally may not

collect a tax by levy or permit a notice of Federal tax lien to

remain on the public record without first offering the taxpayer

an administrative hearing pursuant to section 6330. A taxpayer

who fails to participate in such a hearing may expect to receive

6
In contrast, the procedure involving the conduct of the
meeting is informal. See Davis v. Commissioner, 115 T.C. 35, 41
(2000), where sec. 7521(a) was not considered.
 - 15 -

a notice of determination that the Commissioner’s proposed

collection action is appropriate.

Third, respondent’s interpretation of section 7521(a)(1) in

denying the taxpayer’s right to audio record would serve to

undermine the safeguards in IRS collection actions that Congress

created in section 6330 with the enactment of the Internal

Revenue Service Restructuring and Reform Act of 1998, Pub. L.

105-206, 112 Stat. 685. See S. Rept. 105-174, at 67-69 (1998),

1998-3 C.B. 537, 603-605; H. Conf. Rept. 105-599, at 263-266

(1998), 1998-3 C.B. 755, 1017-1020. Significantly, there is

nothing in section 6330 or in the legislative history of that

section to suggest that Congress did not intend to afford

taxpayers the right, consistent with section 7521(a)(1), to audio

record administrative hearings in collection actions.

Fourth, respondent’s interpretation of section 7521(a)(1)

would lead to the anomalous result of allowing the audio

recording of Examination Division interviews, which are

proceedings that we typically do not review, see Greenberg’s

Express, Inc. v. Commissioner, 62 T.C. 324, 327 (1974), but not

allowing the recording of section 6330 hearings, which are

proceedings that we are statutorily charged with reviewing, see

sec. 6330(d)(1).

Fifth, respondent’s interpretation of section 7521(a)(1)

would complicate judicial review of the determination made by the
 - 16 -

Appeals Office with respect to the Commissioner’s proposed levy

or filing of the notice of Federal tax lien. For example, when a

taxpayer’s underlying tax liability is not properly at issue in

the administrative hearing, we review the Appeals Office’s

determination for abuse of discretion. Lunsford v. Commissioner,

117 T.C. 183, 185 (2001). Having a transcript of the

administrative hearing would certainly facilitate that review.

Cf. Mesa Oil, Inc. v. United States, 86 AFTR 2d 2000-7312, 2001-1

USTC par. 50130 (D. Colo. 2000) (holding, without explicit

consideration of section 7521(a)(1), that a verbatim recording of

a section 6330 hearing was necessary in that case to have a

judicially reviewable administrative record).

In addition, when reviewing for abuse of discretion, we

generally consider “only arguments, issues, and other matter that

were raised at the collection hearing or otherwise brought to the

attention of the Appeals Office”. Magana v. Commissioner, 118

T.C. 488, 493 (2002). Having a transcript would eliminate a

possible dispute between the parties concerning the scope of the

issues that were raised by the taxpayer in the administrative

hearing. Moreover, not having a transcript may contravene the

intent of Congress in providing for a fair and impartial

administrative hearing and may have a negative impact on this

Court’s review of the Appeals Office determination.
 - 17 -

Finally, we observe that section 301.6320-1(d)(2), Q&A-D6,

Proced. & Admin. Regs., and section 301.6330-1(d)(2), Q&A-D6,

Proced. & Admin. Regs., state as follows: “A transcript or

recording of any face-to-face meeting or conversation between an

Appeals officer or employee and the taxpayer or the taxpayer’s

representative is not required”. This statement appears in the

context of a description, in general terms, of the conduct of a

section 6330 hearing. In the instant case, we need not and do

not decide whether every section 6330 hearing must be recorded.

Instead, we decide only whether a taxpayer who seeks to audio

record a section 6330 hearing has the right to do so by virtue of

section 7521(a)(1). In answering that inquiry in the

affirmative, it is unnecessary to decide in this case whether the

cited regulations are invalid.

Conclusion

Accordingly, we hold that, pursuant to section 7521(a)(1),

petitioner is entitled to audio record his section 6330 hearing

with the Appeals Office.

Respondent’s counsel acknowledged at oral argument on the

motion for summary judgment that, if the Court decides the audio

recording issue against respondent, the proper action would be to

remand the case and allow petitioner to have a hearing that he

could record. Therefore, in these circumstances, we shall remand

this case to respondent’s Appeals Office with direction that
 - 18 -

petitioner be offered a section 6330 hearing that may be audio

recorded pursuant to section 7521(a)(1). We shall withhold

action on respondent’s motion for summary judgment to permit the

record to be supplemented. In ordering this remand, we admonish

petitioner that, if he persists in making frivolous and

groundless tax protester arguments at the audio recorded hearing

rather than raising relevant issues, as specified in section

6330(c)(2), relating to the unpaid tax or the proposed levy, the

Court will grant respondent’s motion for summary judgment and

impose a penalty against him pursuant to section 6673(a)(1). See

Pierson v. Commissioner, 115 T.C. 576, 580-581 (2000); Keene v.

Commissioner, T.C. Memo. 2002-277.

Our conclusion in this case that petitioner is entitled to

audio record his section 6330 hearing with the Appeals Office is

not inconsistent with Kemper v. Commissioner, T.C. Memo. 2003-

195, decided this day. Indeed, the two cases are different. In

Kemper, the taxpayers chose to participate in the Appeals Office

hearing, and, subsequently, in filing their petition with this

Court, they included not only a section 7521(a)(1) argument, but

also arguments that were frivolous or groundless. By contrast,

no Appeals Office hearing was held in this case because of

petitioner’s insistence that it be recorded, and the petition

raised only the section 7521(a)(1) issue. Because of the narrow

scope of the pleadings in the present case, respondent has
 - 19 -

acknowledged that, if the Court should decide the section

7521(a)(1) issue in petitioner’s favor, this case should be

remanded in order to permit a recorded hearing. In Kemper, the

pleadings were not narrow in scope, and the Court was able to

address all of the nonsection 7521(a)(1) issues pleaded by the

taxpayers without the need for remanding the case to develop such

issues at an Appeals Office hearing.

To reflect the foregoing,

An appropriate order

will be issued.

Reviewed by the Court.

WELLS, GERBER, COLVIN, HALPERN, LARO, FOLEY, VASQUEZ, GALE,
THORNTON, MARVEL, HAINES, GOEKE, and WHERRY, JJ., agree with this
majority opinion.
 - 20 -

HALPERN, J., concurring: I agree with the majority that

section 7521(a)(1) entitles a taxpayer to make an audio recording

of (“to record”) any oral interview constituting part (or all) of

the hearing required by section 6330(b). I write separately to

explain why it is within our authority to enforce that

entitlement and why, in some cases, we should not exercise that

authority.

With certain restrictions, and subject to certain

conditions, not here relevant, section 7521(a)(1) makes it the

duty of any officer or employee of the Internal Revenue Service

to allow a taxpayer to record any in-person interview relating to

the determination or collection of any tax. Although section

7521(a)(1) establishes a duty, and a corresponding right, it

provides no sanction for violation of that duty or procedure for

enforcement of that right. And while the Supreme Court has said:

“There is no presumption or general rule that for every duty

imposed upon * * * the Government * * * there must exist some

corollary punitive sanction for departures or omissions, even if

negligent”, United States v. Montalvo-Murillo, 495 U.S. 711, 717

(1990), section 706 of the Administrative Procedure Act (the

APA), 5 U.S.C. secs. 551–559, 701-706 (2000) (hereafter, sections

of which are cited as APA “sec. _”) provides, in pertinent part,

that a court reviewing an agency adjudication (which a
 - 21 -

determination made under section 6330(c)(3) is1) “shall * * *

hold unlawful and set aside agency action * * * found to be * * *

without observance of procedure required by law”. We thus have

our authority for refusing to sustain a determination made under

section 6330 when the Appeals Officer has refused to allow the

taxpayer to record an in-person interview.

APA sec. 706 concludes, however: “In making the foregoing

determinations, the court shall review the whole record or those

parts of it cited by a party, and due account shall be taken of

the rule of prejudicial error.” (Emphasis added.) The “rule of

prejudicial error” (otherwise the doctrine of harmless error), as

applied to an administrative action, provides that the reviewing

court shall disregard procedural errors unless the complaining

party was prejudiced thereby. See the discussion of APA sec. 706

and harmless error in Nestor v. Commissioner, 118 T.C. 162, 173

(2002) (Halpern, J., concurring). In this proceeding, petitioner

did not proceed with his section 6330 hearing after the Appeals

Officer refused him permission to record it, and respondent’s

sole ground for summary judgment is the absolute inapplicability

of section 7521(a)(1) to a section 6330 hearing. Respondent

asked that, if we reject his argument (which we do), we remand

the case so that petitioner could be accorded a hearing that he

1
See Lunsford v. Commissioner, 117 T.C. 159, 170-171
(2001) (Halpern, J., concurring).
 - 22 -

could record. For that reason, we need not determine whether the

Appeals Officer’s initial refusal to allow recording is harmless

error.

In Kemper v. Commissioner, T.C. Memo. 2003-195, decided this

day, the taxpayer husband was denied the right to record his

meeting with the Appeals Office but attended anyway. Judge

Chiechi acknowledges that here (in Keene) we hold that section

7521(a) requires the Appeals Office to allow a taxpayer to record

a section 6330 hearing, yet she concludes that it is unnecessary,

and would be unproductive, to remand her case for another,

recorded hearing. She relies on Lunsford v. Commissioner, 117

T.C. 183 (2001), in which, it appears to me, we concluded that

the Appeals Officer did not err by refusing to consider meritless

arguments. Undoubtedly (given our holding in this case), the

Appeals Office in Kemper did err in not permitting the taxpayer

husband to record his meeting. Nevertheless, the burden is on

the party seeking judicial review of an agency action to

demonstrate prejudice from any error. DSE, Inc. v. United

States, 169 F.3d 21, 31 (D.C. Cir. 1999). Since Judge Chiechi

finds that the taxpayers in Kemper advance nothing but frivolous

arguments and groundless claims, I fail to see how they are

prejudiced by the Appeals Office’s error in failing to allow the

taxpayer husband to record his meeting. I would reach the same

result in Kemper as Judge Chiechi, but I would arrive there by a
 - 23 -

different path.

GALE and MARVEL, JJ., agree with this concurring opinion.
 - 24 -

VASQUEZ, J., concurring: I agree with the majority opinion;

however, I write separately to address two additional points.

1. We Are Not Invalidating the Regulations

The majority opinion does not invalidate section 301.6320-

1(d)(2) or 301.6330-1(d)(2), Q&A-D6, Proced. & Admin. Regs.

Contra J. Swift’s dissenting op. pp. 34-36. In both sections

301.6320-1(d)(2) and 301.6330-1(d)(2), Q-D6, Proced. & Admin.

Regs., asks: “How are CDP hearings conducted?” In both sections

301.6320-1(d)(2) and 301.6330-1(d)(2), A-D6, Proced. & Admin.

Regs., answers, in pertinent part:

CDP hearings are much like Collection Appeal Program
(CAP) hearings in that they are informal in nature and
do not require the Appeals officer or employee and the
taxpayer, or the taxpayer’s representative, to hold a
face-to-face meeting. A CDP hearing may, but is not
required to, consist of a face-to-face meeting, one or
more written or oral communications between an Appeals
officer or employee and the taxpayer or the taxpayer’s
representative, or some combination thereof. A
transcript or recording of any face-to-face meeting or
conversation between an Appeals officer or employee and
the taxpayer or the taxpayer’s representative is not
required. * * *

The “is not required” language contained in the regulations means

that the actions described therein are permissible but not

mandatory.

The regulations first provide that a face-to-face meeting is

not required. This, however, does not prohibit face-to-face

meetings--many section 6330 hearings are face-to-face meetings.

The regulations simply provide that it is not mandatory that a
 - 25 -

section 6330 hearing be a face-to-face meeting.

Likewise, the regulations do not prohibit recording or

transcription of any face-to-face meeting or conversation, they

merely provide that a recording or transcription of the section

6330 hearing is not required. In other words, recording or

transcription of the section 6330 hearing is not mandatory;

however, it is permissible.

Furthermore, allowing taxpayers to record the hearing does

not require that the Commissioner do so as well. Although the

Commissioner also may choose to record the hearing, sec.

7521(a)(2), just because the taxpayer records the hearing this

does not require the Commissioner also to record it.1

If the Secretary had sought to prohibit recordings and

transcriptions (and face-to-face meetings for that matter), he

could have chosen such phrases as a recording “is not allowed”,

“is not permitted”, “is prohibited”, or “shall not be made”. He

did not. The regulations instead contain the language “is not

required” which permits, but does not mandate, a recording.2

1
I realize, however, as a practical matter that if a
taxpayer records the hearing the Commissioner will likely record
it also.
2
Other answers contained in sec. 301.6330-1(d)(2), Proced.
& Admin. Regs. contain “mandatory” language. Sec. 301.6330-
1(d)(2), A-D1, Proced. & Admin. Regs. (“The taxpayer is not
entitled to another CDP hearing under section 6330 if the
additional assessment represents accrual of interest, accrual of
penalties, or both.”), A-D5, Proced. & Admin. Regs. (“The
(continued...)
 - 26 -

2. Welcoming a Transcript

Having a transcript of the section 6330 hearing will allow

us to perform better the review provided to taxpayers by section

6330(d).

Until now, in order to determine what issues taxpayers

raised at the section 6330 hearing, the Court was faced with “he

said-she said” situations--needless “credibility contests”

between the taxpayer and the Appeals officer. In many cases this

contest was not fully developed because the only evidence

submitted to determine what issues were raised at the hearing was

the notice of determination.

I have tried a number of cases in which it was difficult to

determine what issues the taxpayer raised at the section 6330

hearing. Sometimes it is obvious that the Appeals officer had

extreme difficulty understanding what issues the taxpayer raised

at the hearing. In those cases, we were left merely with the

confusing testimony of the taxpayer and the Appeals officer’s

testimony regarding what issues he or she “believed” the taxpayer

raised.

Instead of merely having the notice of determination or the

2
(...continued)
taxpayer must sign a written waiver.”), and A-D7, Proced. &
Admin. Regs. (“The taxpayer must be offered an opportunity for a
hearing at the Appeals office closest to [sic] taxpayer’s
residence or, in the case of a business taxpayer, the taxpayer’s
principal place of business.”) (Emphasis added.)
 - 27 -

testimony of witnesses as evidence of what issues the taxpayer

raised at the hearing, now the parties will be able to submit as

evidence a transcript of the hearing. In Bourbeau v.

Commissioner, T.C. Memo. 2003-117, the taxpayer and the

Commissioner recorded the section 6330 hearing and a court

reporter transcribed the hearing. The taxpayer attached a copy

of the transcript to his amended petition, and the Commissioner

attached a copy of the transcript to his motion for summary

judgment. I found the transcript of the hearing to be extremely

helpful in rendering a decision in Bourbeau--especially in the

context of a pretrial motion. The transcript made it clear what

issues the taxpayer in Bourbeau did, and did not, raise at the

hearing. See also Struhar v. Commissioner, T.C. Memo. 2003-147

(in which a tape recording of the taxpayer’s section 6330 hearing

helped the Court decide what transpired at the hearing). I look

forward to such clarity in the future.

LARO, FOLEY, MARVEL, and GOEKE, JJ., agree with this
concurring opinion.
 - 28 -

WHERRY, J., concurring: Respondent has taken the position

that section 7521 does not apply to the hearings afforded under

sections 6320 and 6330, on grounds that such hearings are not

“interviews” within the meaning of section 7521. The majority

rightly concludes, relying in large part on the ordinary meaning

of the term “interview”, that taxpayers are entitled to make

audio recordings of section 6320 and 6330 hearings. I write

separately to highlight several additional reasons why the

majority is correct.

First, it is significant that the express language of

section 7521 grants a right which turns on the subject matter of

the interview and not on either (1) the particular function

within the Internal Revenue Service (Service) of the officer or

employee conducting the interview or (2) the voluntary or

involuntary nature of the interview. The statute requires the

Service to permit taping whenever an interview is held relating

to the determination or collection of tax.

Second, neither legislative history nor administrative

pronouncements directs a different result. Legislative history

with respect to section 7521 expressly covered the “initial in-

person audit interviews" and "initial in-person collection

interviews". H. Conf. Rept. 100-1104, at 212-214 (1988), 1988-3

C.B. 473, 702-704. The Service subsequently took the following

administrative position in defining "taxpayer interview":
 - 29 -

For purposes of section 7520 of the Code [later
redesignated section 7521], the term “taxpayer
interview” means a meeting between an officer or
employee of the Examination function, the Employee
Plans and Exempt Organization function, or the
Collection function of the Service, and a taxpayer or
authorized representative, as defined in section
7520(b)(2), when the determination or the collection of
any tax is at issue.

* * * * * * *
LEGAL EFFECT: This document serves as an
“administrative pronouncement” as that term is
described in section 1.6661-3(b)(2) of Income Tax
Regulations and may be relied upon to the same extent
as a revenue ruling or revenue procedure. [Notice 89-
51, 1989-1 C.B. 691 (Notice 89-51).]

Because the Office of Appeals is typically treated by the

Service as an independent function, separate and distinct from

the Examination, Employee Plans and Exempt Organization, and

Collection functions, respondent maintains that a hearing with an

Appeals officer is not an in-person interview within the ambit of

section 7521. I do not agree with this contention. As to

hearings under sections 6320 and 6330, Appeals, although

separate, is in my view an integral component of the overall

Examination, Employee Plans and Exempt Organization, and

Collection functions.

Notice 89-51 is not controlling here since, by its own

terms, its legal effect is similar to that of revenue rulings and

revenue procedures. This Court and the Court of Appeals for the

Ninth Circuit, to which appeal in the instant case would normally

lie, have indicated that revenue rulings "do not rise to the
 - 30 -

dignity of those ‘rules and regulations’ which under the

authority of sec. 7805(a) are prescribed by respondent ‘with the

approval of the Secretary.’ Sec. 301.7805-1(a), Proced. & Admin.

Regs." Estate of Lang v. Commissioner, 64 T.C. 404, 406-407 &

n.4 (1975), affd. in part on this issue and revd. in part on

other grounds 613 F.2d 770 (9th Cir. 1980); see also United

States v. Mead Corp., 533 U.S. 218, 228 (2001).

Moreover, notwithstanding Notice 89-51, the Service until

May 2002 preempted litigation as to its construction of section

7521 by providing taxpayers with the right to record Appeals

conferences or hearings and, in the process, explicitly

recognized the integral role played by Appeals in the

Examination, Employee Plans and Exempt Organization, and

Collection functions. See 5 Administration, Internal Revenue

Manual (CCH), sec. 8626.1, at 25,784 (e.g., 10-23-91 revision),

which provided:

General Guidelines

(1) The audio recording of an Appeals conference
is generally permitted, if the taxpayer, or the
taxpayer’s authorized representative requests it, and
supplies the recording equipment. In such cases, the
appeals officer will also make an audio recording of
the conference with IRS equipment.

(2) IRC 7521 (formerly IRC 7520) provides that
taxpayers may make audio recordings of interviews with
the IRS that determine liability or collectibility.
Although Appeals conferences differ in nature from
taxpayer interviews in the auditing or collecting
functions, Appeals still decides liability or
collectibility on cases in which those issues have been
 - 31 -

referred to us. Procedures for making audio recordings
are described in Notice 89-51, 1989-1 C.B., and Appeals
employees will follow the provisions of Notice 89-51
when allowing recordings in cases within Appeals
jurisdiction. [Emphasis added.]

In fact, Appeals officers from time to time have performed

limited audit functions when necessary to expediently resolve tax

cases. Further, in recent years, both Congress and the Service

have increasingly utilized Appeals officers and settlement

officers during the examination and collection phases of a tax

case. See, e.g., secs. 6320, 6330, 7123; see also Rev. Proc.

2003-41, 2003-25 I.R.B. 1047 (fast-track mediation procedures);

Rev. Proc. 2003-40, 2003-25 I.R.B. 1044 (fast-track settlement

procedures); Announcement 2003-36, 2003-25 I.R.B. 1093 (tax-

exempt bond mediation program); Rev. Proc. 2002-67, 2002-43

I.R.B. 733 (tax shelter settlement initiative); Rev. Proc. 2002-

52, 2002-31 I.R.B. 242 (simultaneous Appeals consideration and

competent authority assistance procedure); I.R.S. News Release

IR-2000-42 (June 27, 2000) (Mutually Accelerated Appeals Process

for coordinated examinations of large corporate taxpayers); Rev.

Proc. 99-28, 1999-2 C.B. 109 (procedures for early referral of

“unresolved issues from the Examination or Collection Division to

the Office of Appeals”). Given this involvement of Appeals in

the Examination, Employee Plans and Exempt Organizations, and

Collection functions, section 7521 cannot logically be

interpreted as properly excluding the Appeals Office simply
 - 32 -

because it is the Appeals Office.1

When Congress enacted sections 6320 and 6330 in 1998,

section 7521(a), permitting taxpayers to record any in-person

interviews relating to the determination or collection of any

tax, was already 10 years old. Admittedly, Congress could have

enacted sections 6320 and 6330 with the assumption that the

rights granted in section 7521, as those rights apply to section

6320 and 6330 Appeals hearings, would be governed by Notice 89-

51. However, it seems to me more likely that Congress, if it

considered this issue, would have assumed that the right to

1
While the Service Litigation Guideline Memorandum GL-17
(GL-17) is more explicit in stating that it is the Service’s
position "that section 7521 does not apply to an administrative
appeals conference", it is a litigating position not controlling
on this Court. The authority cited in GL-17 for excluding
Appeals conferences from sec. 7521 is Notice 89-51. As noted
above, I find that authority unpersuasive.

GL-17 also makes a distinction between those third-party
interviews where a witness is compelled to testify by legal
process, such as a summons or subpoena, vis-a-vis those
situations where the witness testifies voluntarily. The
memorandum notes that pursuant to the Administrative Procedures
Act (APA), 5 U.S.C. secs. 551-559, 701-706 (2000), if the
testimony of the witness was compelled by legal process,
recording should be allowed since that witness would under APA
sec. 555(c) be entitled, at his or her cost, to a copy of the
official transcript of his or her testimony.

The compelled versus voluntary distinction, however, is
irrelevant to taxpayer interviews which are governed by sec.
7521. The result under that section should not be affected by
whether or not the taxpayer interview was compelled by legal
process or was voluntary. Sec. 7521, unlike APA sec. 555(c),
does not differentiate between voluntary and compelled taxpayer
interviews.
 - 33 -

record in-person interviews, as applied to section 6320 and 6330

Appeals hearings, would be administered by the Service in the

same manner as the Service had for the 10 years since its

enactment administered section 7521. In any event, because

taxpayers had the right to tape Appeals proceedings at the time

sections 6320 and 6330 were enacted, nothing can be presumed from

Congress’s silence regarding the right to record these hearings.

Third, several considerations of fairness or practicality

support the taxpayer’s right to record hearings under section

6320 or 6330. In particular, it is noteworthy that both section

7521 and sections 6320 and 6330 were enacted to add to the

taxpayer’s procedural rights. The usefulness of a transcript for

purposes of review of sections 6320 and 6330 proceedings also

cannot be ignored. Lastly, the concerns apparently generating

the Service’s retraction of recording rights in the Appeals

context can perhaps be handled effectively in ways less drastic

than a complete curtailment.

GERBER, LARO, FOLEY, MARVEL, and GOEKE, JJ., agree with this
concurring opinion.
 - 34 -

SWIFT, J., dissenting: I agree with the Lunsford treatment

of the taxpayers’ frivolous arguments that is reflected in the

Kemper opinion being released simultaneously herewith. Kemper v.

Commissioner, T.C. Memo. 2003-195. In Kemper, we conclude,

because of the frivolous nature of the taxpayers’ underlying

arguments, that the Court need not address the taxpayers’

arguments regarding the recording under section 7521 of

collection due process (CDP) Appeals hearings. The same approach

should be utilized herein to dispose of Keene’s underlying

frivolous arguments to the collection action proposed by

respondent.1

In addition to the grounds set forth herein in Judge

Chiechi’s dissenting opinion, as the basis for my dissent I

respectfully add the following.

The Regulations

Q&A-D6 of both sections 301.6320-1(d)(2) and 301.6330-

1(d)(2), Proced. & Admin. Regs., provides that in the context of

CDP Appeals hearings the IRS is not required to record “any”

taxpayer conversation with an Appeals officer. In appropriate

cases, the IRS may choose to do so and may permit taxpayers to do

so, but, under the regulations, the IRS may not be required in

“any” case to record a CDP Appeals hearing, nor is the IRS

1
Under Lunsford v. Commissioner, 117 T.C. 183, 188-189
(2001), generally frivolous CDP cases can and should be dealt
with summarily by the courts.
 - 35 -

required to permit taxpayers to do so. Procedure and

Administrative regulations sections 301.6320-1(d)(2) and

301.6330-1(d)(2) provide identically as follows:

A-D6. The formal hearing procedures required under the
Administrative Procedure Act, 5 U.S.C. 551 et seq., do not
apply to CDP hearings. CDP hearings are much like
Collection Appeal Program (CAP) hearings in that they are
informal in nature and do not require the Appeals officer or
employee and the taxpayer, or the taxpayer’s representative,
to hold a face-to-face meeting. A CDP hearing may, but is
not required to, consist of a face-to-face meeting, one or
more written or oral communications between an Appeals
officer or employee and the taxpayer or the taxpayer’s
representative, or some combination thereof. A transcript
or recording of any face-to-face meeting or conversation
between an Appeals officer or employee and the taxpayer or
the taxpayer’s representative is not required. The taxpayer
or the taxpayer’s representative does not have the right to
subpoena and examine witnesses at a CDP hearing.

I interpret the above regulations broadly to provide a rule

that the recording of CDP Appeals hearings may not be required

regardless of whom it is that physically is to provide the

recording equipment (the IRS or the taxpayer) and regardless of

whom it is that technically is to make the recording (the IRS or

the taxpayer).

Contrary to the regulations as I read them, Keene holds in

the affirmative, majority op. p. 17, that the IRS was required to

allow Keene to record his CDP Appeals hearing and orders a new

hearing be scheduled for Keene that is to be recorded.

This opinion effectively invalidates the above regulations.
 - 36 -

Recent cases in the Federal District Courts have treated

taxpayers’ requests to tape record CDP Appeals hearings as

discretionary with the IRS and have treated taxpayers’ refusals

to participate in the CDP Appeals hearings unless they were

permitted to tape record these hearings as a waiver of the

taxpayers’ right to a face-to-face hearing. See Muhammad v.

United States, 91 AFTR 2d 1985, at 1987 (D.S.C. 2003); Henry v.

Bronstein, 90 AFTR 2d 7134, at 7135, 2002-2 USTC par. 50,781, at

86,147 (D. Md. 2002). In one recent case, Rennie v. IRS,

216 F. Supp. 2d 1078 (E.D. Cal. 2002), the District Court also

noted the mischief taxpayers may create with amateur, uncertified

transcripts of Appeals hearings, stating as follows:

Also attached to the Complaint is what purports to be a
transcript of the Collection Due Process Hearing. The
hearing was tape recorded by plaintiff and he has
prepared the transcript of it. The transcript is not
certified. Moreover, from the court’s research, the
Collection Due Process hearings are supposed to be
informal and there is not [a] requirement that the
hearings be recorded. [Id. at 1079 n.1.]

Frivolous Arguments

Keene’s frivolous arguments are well documented. In an

attachment to Keene’s CDP Appeals hearing request, Keene provides

a detailed, single-spaced, multipage explanation of the

underlying arguments for his appeal of respondent’s proposed

collection action. Keene’s lengthy explanation is full of

scripted, frivolous, tax protester arguments. Therein, Keene
 - 37 -

claims that his rights as a taxpayer were ignored by the IRS from

the beginning, and he asserts that the only acceptable remedy is

for the IRS to “start all over again”. He states as follows:

The IRS has ignored most of my rights even though I
have pointed this out, in detail, time after time in
letters originating as far back as 11/7/1991. I have
carefully documented the IRS’ total disregard of my
rights to date. Should the IRS deny this request for a
due process hearing it will only be adding to the
overwhelming evidence I have accumulated showing the
IRS’ illegal denial of my rights to hearings and
information.

Now, should you [the Appeals officer], finally decide
to grant me a simple hearing at this very late stage in
the due process system I will expect you to find that
this entire matter, for the tax period 1040 ending
12/31/1991, be remanded back to the very beginning of
this process. This remand must go back to include all
of the hearings and all of the information due me as
outlined in my previous letters. Otherwise my rights
will have been violated. * * *

The written explanation attached to Keene’s CDP hearing

request itself provides the Court with an adequate record of

Keene’s arguments that serve as the underlying basis for his

challenge to respondent’s proposed collection action. A tape

recording to establish that record is not necessary. It is

overwhelmingly clear that there is no merit to Keene’s underlying

arguments, and I believe that, under Lunsford v. Commissioner,

117 T.C. 183 (2001), this Court ought to dispose of Keene’s

challenge to respondent’s proposed collection action summarily

and without deciding the section 7521(a)(1) issue (i.e., the

approach taken in Kemper v. Commissioner, supra).
 - 38 -

At the most, if some delay is to be tolerated in disposing

of Keene’s petition challenging respondent’s proposed collection

action, an order should be issued asking Keene to advise the

Court in writing, within a specified time period, what underlying

arguments he would make (if he were given another opportunity to

have a CDP Appeals hearing and to have the hearing recorded) that

are not already reflected in the referred-to written attachment

to his CDP hearing request. If Keene files a response to such an

order containing only frivolous arguments, this case could easily

be disposed of without ever addressing the legal issue raised

under section 7521(a)(1).

I acknowledge that, in the few nonprotester CDP cases that

seem to exist, recorded transcripts of CDP Appeals hearings may

be helpful, and nothing that we adopt in the Kemper or Keene

opinions will prevent the IRS and taxpayers from agreeing to

record CDP Appeals hearings in appropriate situations.

In summary, to conclude that the IRS should be required to

record CDP Appeals hearings or to permit taxpayers to record such

hearings -- whenever taxpayers make such requests and regardless

of how difficult the taxpayers and how frivolous their underlying

arguments -- strikes me as contrary to the above regulations, as

inappropriate judicial meddling with respondent’s Appeals

hearings, as inefficient use of judicial resources, and as

conducive to further delay in the collection of taxes the Federal

Government desperately needs.
 - 39 -

CHIECHI, J., dissenting: In holding that section 7521(a)(1)

requires respondent to allow petitioner to make an audio

recording of his section 6330(b) Appeals Office hearing, the

majority fails to apply the rules of statutory construction on

which the majority claims to rely. In remanding this case to

Appeals in order to allow petitioner to have a hearing that he

may audio record, the majority has rewarded the delaying tactics

of petitioner, who has a long history of raising frivolous and/or

groundless reasons why he claims he owes no Federal income tax

(tax),1 has rewarded his noncompliance with Rule 331, and has

caused an unwarranted delay in the instant proceedings. I

dissent from all the actions of the majority.

In order to resolve the issue whether section 7521(a)(1)

requires respondent to allow petitioner to make an audio

recording of his section 6330(b) Appeals Office hearing, it is

necessary to determine whether the phrase “in-person interview”

used in that section includes a hearing before Appeals under

section 6330(b) (and section 6320(b)). In order to resolve that

question, it first is necessary to determine whether section

7521(a)(1) requires the Internal Revenue Service (IRS) to allow a

taxpayer to make an audio recording of a hearing or conference

1
As an illustration of petitioner’s past conduct, see Keene
v. Commissioner, T.C. Memo. 2002-277, where the Court granted
summary judgment and imposed a penalty under sec. 6673(a)(1) in
the amount of $5,000.
 - 40 -

before Appeals outside the context of section 6330(b) (and

section 6320(b)). That is because: (1) Section 6330(b) (and

section 6320(b)) was not even part of the Internal Revenue Code

(Code) when Congress enacted section 7521(a)(1) into the Code in

1988; and (2) we concluded in Davis v. Commissioner, 115 T.C. 35,

41 (2000), that the type of hearing by Appeals that Congress

contemplated when it enacted section 6330(b) is “the type of

informal administrative Appeals hearing that has been

historically conducted by Appeals”, which is the administrative

office of last resort for taxpayers.2

2
I disagree with the suggestion in footnote 6 of the
majority opinion that Davis v. Commissioner, 115 T.C. 35 (2000),
addressed only the procedure involving the conduct of a hearing
before Appeals under sec. 6330(b) (and sec. 6320(b)). Although
the ultimate holding in Davis was that a hearing before Appeals
pursuant to sec. 6330 does not include the right to subpoena
witnesses, the following passage makes it clear that Davis
focused not only on the procedure but also on the nature and
function of Appeals:

When Congress enacted section 6330 and required
that taxpayers be given an opportunity to seek a pre-
levy hearing with Appeals, Congress was fully aware of
the existing nature and function of Appeals. Nothing
in section 6330 or the legislative history suggests
that Congress intended to alter the nature of an
Appeals hearing so as to compel the attendance or
examination of witnesses. * * * The references in
section 6330 to a hearing by Appeals indicate that
Congress contemplated the type of informal
administrative Appeals hearing that has been
historically conducted by Appeals and prescribed by
section 601.106(c), Statement of Procedural Rules.

Davis v. Commissioner, supra at 41.

(continued...)
 - 41 -

Congress enacted all the provisions of section 7521,

including section 7521(a)(1), as part of the Technical and

Miscellaneous Revenue Act of 1988 (TAMRA), Pub. L. 100-647, 102

Stat. 3342. Congress prescribed in section 7521 several

procedures involving taxpayer interviews.3 All of those

procedures relate to the same taxpayer interviews; i.e., the same

“in-person interviews”.

It was not until 1998, 10 years after Congress made section

7521 part of the Code, that Congress enacted section 6330

relating to proposed levies (and section 6320 relating to liens)

as part of the Internal Revenue Service Restructuring and Reform

Act of 1998, Pub. L. 105-206, 112 Stat. 685, in order to give

taxpayers certain rights, including the right to a hearing before

the Appeals Office, sec. 6330(b) (relating to proposed levies);

2
(...continued)
Assuming arguendo that the majority were correct in
suggesting that Davis addressed only the procedure involving the
conduct of an Appeals hearing under sec. 6330(b) (and sec.
6320(b)), the right to make an audio recording at an “in-person
interview” provided in sec. 7521(a)(1) relates only to a
procedure involving the conduct of such an “in-person interview”.
As discussed below, Congress enacted sec. 7521(a)(1) into the
Code as one of several procedures involving “in-person
interviews” set forth in sec. 7521. Indeed, sec. 7521 is
entitled “PROCEDURES INVOLVING TAXPAYER INTERVIEWS”. See H.
Conf. Rept. 100-1104, at 212 (1988), 1988-3 C.B. 473, 702.
3
Sec. 7521 sets forth procedures regarding “Recording of
Interviews”, sec. 7521(a), “Safeguards” and “Right of
Consultation” with respect to such interviews, sec. 7521(b)(1)
and (2), and “Representatives Holding Power of Attorney” who
appear at such interviews, sec. 7521(c).
 - 42 -

sec. 6320(b) (relating to liens), and the right to Court review

of a determination made by that office under section 6330(c),

sec. 6330(d)(1). Consequently, in order to analyze properly the

meaning of the phrase “in-person interview” in section

7521(a)(1), it is necessary to undertake such an analysis in the

context of hearings or conferences historically conducted before

Appeals, which were extant in 1988 when Congress enacted section

7521 as part of TAMRA and which we held in Davis v. Commissioner,

supra, were the types of informal administrative Appeals hearings

that Congress contemplated when it enacted section 6330(b). It

is inappropriate to analyze, as the majority does, the meaning of

the phrase “in-person interview” in the context of reasons

grounded in the operation and purpose of section 6330 (and

section 6320), which Congress did not make part of the Code until

10 years after it enacted section 7521.

The majority begins its analysis of the meaning of the

phrase “in-person interview” in section 7521(a)(1) by stating:

Neither section 7521(a)(1) nor the legislative history
directly and clearly defines or otherwise describes the
term “in-person interview”. Where a term is not
defined in the statute, it is appropriate to accord the
term its “ordinary meaning”. Northwest Forest Resource
Council v. Glickman, 82 F.3d 825, 833 (9th Cir. 1996).
And when there is no indication that Congress intended
a specific legal meaning for the term, courts may look
to sources such as dictionaries for a definition.
Muscarello v. United States, 524 U.S. 125, 127-132
(1998); see also Huntsberry v. Commissioner, 83 T.C.
742, 747-748 (1984), in which the Court stated that
“where a statute is clear on its face, * * * we would
require unequivocal evidence of legislative purpose
 - 43 -

before construing the statute so as to override the
plain meaning of the words used therein.” [Fn. ref.
omitted.]

Majority op. pp. 10-11.

The majority fails to apply the rules of statutory

construction on which it claims to rely when, in determining the

meaning of the phrase “in-person interview” in section

7521(a)(1), it turns to the dictionary definition of the term

“interview”. Although I agree with the majority that Congress

did not “directly * * * define” the phrase “in-person interview”

in section 7521(a)(1) or any other provision in section 7521 or

in the legislative history, I disagree with the majority that

neither the statute nor the legislative history “clearly * * *

otherwise describes” that phrase. Section 7521 itself and the

legislative history of that section clearly describe what

Congress intended when it used the phrase “in-person interview”.

In determining what Congress had in mind when it used the

phrase “in-person interview” in section 7521(a)(1), the majority

improperly focuses only on section 7521(a)(1) for guidance. In

determining what Congress intended, section 7521(a)(1) may not be

read in a vacuum. It must be examined in the context of the

entire statute (i.e., section 7521) that Congress enacted in 1988

for the purpose of prescribing certain procedures that it made

applicable to all “in-person interviews”. If the majority had

undertaken such an examination, it would have become clear to the
 - 44 -

majority what Congress meant when it used the phrase “in-person

interview” in section 7521.

Section 7521(b)(1) provides:

SEC. 7521. PROCEDURES INVOLVING TAXPAYER INTERVIEWS.

(b) Safeguards.--

(1) Explanations of processes.--An officer or
employee of the Internal Revenue Service shall before
or at an initial interview provide to the taxpayer--

(A) in the case of an in-person interview
with the taxpayer relating to the determination of
any tax, an explanation of the audit process and
the taxpayer’s rights under such process, or

(B) in the case of an in-person interview
with the taxpayer relating to the collection of
any tax, an explanation of the collection process
and the taxpayer’s rights under such process.

Section 7521(b)(1) thus clearly describes what Congress intended

when it used the phrase “in-person interview” in section 7521.

Not only section 7521 itself, but the legislative history of

that section also is instructive in determining what Congress had

in mind when it used the phrase “in-person interview” in section

7521(a)(1). The conference report relating to section 7521, H.

Conf. Rept. 100-1104, at 212-214 (1988), 1988-3 C.B. 473, 702-704

(conference report), provides in pertinent part:

Prior to initial in-person audit interviews, the IRS
must explain to taxpayers the audit process and
taxpayers’ rights under that process. In addition,
prior to initial in-person collection interviews, the
IRS must explain the collection process and taxpayers’
rights under that process. For this purpose, routine
telephone conversations initiated by either the
taxpayer or the IRS are not considered initial
 - 45 -

interviews. A written statement handed to the taxpayer
at an audit or collection interview or within a short
time before the interview is sufficient. * * *

H. Conf. Rept. 100-1104, at 213 (1988), 1988-3 C.B. 473, 703.

Section 7521(b)(1) and the conference report make clear

that, when Congress used the phrase “in-person interview” in

section 7521, it did not have in mind either the dictionary

definition of the term “interview” on which the majority

improperly relies or the historically voluntary and informal

hearings or conferences before Appeals. The descriptions by

Congress in section 7521 itself and its legislative history leave

no doubt that what Congress meant when it used the phrase “in-

person interview” in section 7521, including section 7521(a)(1),

is an in-person audit interview and an in-person collection

interview, which take place during the audit process and the

collection process, respectively, and the function of which is to

investigate and determine facts relating to the determination and

the collection of any tax. Thus, it makes perfect sense that

Congress decided in section 7521 to allow taxpayers, sec.

7521(a)(1), as well as the IRS, sec. 7521(a)(2), to record such

types of interviews. That is because in-person audit interviews

and in-person collection interviews are interviews initiated by

the IRS that taxpayers are under some compulsion to attend and

that the IRS conducts for the purpose of gathering information to

use in the determination of and the collection of tax,
 - 46 -

respectively; i.e., interviews of taxpayers initiated by the

examination division and by the collection division,

respectively, and therefore not infrequently involuntary, which

are investigative or inquisitorial in nature and which can be

enforced by the issuance of an administrative summons.

In contrast to the in-person audit interviews and the in-

person collection interviews that Congress intended section 7521

to address, hearings or conferences before Appeals extant at the

time in 1988 Congress made section 7521 part of the Code

historically were, and remain, conferences initiated by taxpayers

and therefore voluntary, which are conducted in an informal

setting in order to review and consider actions taken by the

examination division or the collection division of the IRS and to

discuss the facts and the law relating to such actions for the

purpose of settling or resolving those matters without resort to

litigation. See secs. 601.106 and 601.203, Statement of

Procedural Rules. An Appeals officer does not have the same

investigative authority that a revenue agent involved in an

examination matter or a revenue officer involved in a collection

matter has. Indeed, where alleged new facts are presented at

Appeals that require authentication or verification, an Appeals

officer may ask the examination division or the collection

division of the IRS to authenticate and/or to investigate those
 - 47 -

alleged new facts.4 That is because the function of the

4
Sec. 601.106(f)(5) and (6), Statement of Procedural Rules,
provides in pertinent part:

(f) Conference and practice requirements.
Practice and conference procedure before Appeals is
governed by Treasury Department Circular 230 as amended
(31 CFR Part 10), and the requirements of Subpart E of
this part. In addition to such rules but not in
modification of them, the following rules are also
applicable to practice before Appeals:

* * * * * * *

(5) Rule V. In order to bring an unagreed income,
profits, estate, gift, or Chapter 41, 42, 43, or 44 tax
case in prestatutory notice status, an employment or
excise tax case, a penalty case, an Employee Plans and
Exempt Organization case, a termination of taxable year
assessment case, a jeopardy assessment case, or an
offer in compromise before the Appeals office, the
taxpayer or the taxpayer’s representative should first
request Appeals consideration and, when required, file
with the district office (including the Foreign
Operations District) or service center a written
protest setting forth specifically the reasons for the
refusal to accept the findings. If the protest
includes a statement of facts upon which the taxpayer
relies, such statement should be declared to be true
under the penalties of perjury. The protest and any
new facts, law, or arguments presented therewith will
be reviewed by the receiving office for the purpose of
deciding whether further development or action is
required prior to referring the case to Appeals. * * *

(6) Rule VI. A taxpayer cannot withhold evidence
from the district director of internal revenue and
expect to introduce it for the first time before
Appeals, at a conference in nondocketed status, without
being subject to having the case returned to the
district director for reconsideration. Where newly
discovered evidence is submitted for the first time to
Appeals, in a case pending in nondocketed status, that
office, in the reasonable exercise of its discretion,
may transmit same to the district director for his or
(continued...)
 - 48 -

examination division and the collection division, respectively,

is to investigate and determine facts relating to the

determination and the collection of any tax.

Thus, it makes perfect sense that, when Congress enacted

section 7521(a)(1) and the other “PROCEDURES INVOLVING TAXPAYER

INTERVIEWS” set forth in section 7521, it did not intend to

include hearings or conferences historically held before Appeals

for the purpose of attempting to settle or otherwise resolve

actions taken by the examination division or the collection

division of the IRS without resort to litigation. And it makes

no sense that Congress would have required that section

7521(a)(1) and the other procedures in section 7521 apply to such

hearings or conferences. Pursuant to the majority’s holding that

the phrase “in-person interview” includes an Appeals hearing, not

only taxpayers, see sec. 7521(a)(1), but also Appeals officers,

see sec. 7521(a)(2), have the right to make an audio recording of

Appeals hearings. I believe that such audio recordings will

inhibit unnecessarily and inappropriately the give-and-take that

typically takes place at such hearings and conferences in order

to attempt to negotiate settlements or otherwise resolve actions

taken by the examination division or the collection division of

the IRS without resort to litigation.

4
(...continued)
her consideration and comment.
 - 49 -

In this connection, it is important to keep in mind that the

majority’s holding under section 7521(a)(1) applies not only to

Appeals hearings held pursuant to section 6330(b) (and section

6320(b)) but also extends to all hearings and conferences before

Appeals in deficiency and other contexts. The phrase “in-person

interview” in section 7521 cannot be read to apply only to

hearings before Appeals under section 6330(b) (and section

6320(b)). That phrase must apply to all hearings or conferences

before Appeals, or to no such hearings and conferences. That is

because: (1) There was no right to a section 6330 hearing (or a

section 6320 hearing) in 1988 when Congress enacted section 7521

into the Code; and (2) we held in Davis v. Commissioner, 115 T.C.

at 41, that “The references in section 6330 to a hearing by

Appeals indicate that Congress contemplated the type of informal

administrative Appeals hearing that has been historically

conducted by Appeals”.

It is a cardinal rule of statutory construction that, when

Congress made section 6330(b) (and section 6320(b)) part of the

Code in 1998, it is presumed to have been aware that it used the

phrase “in-person interview” in section 7521. If Congress had

intended for the hearing before Appeals under section 6330(b)

(and section 6320(b)) to constitute an “in-person interview”

under section 7521, it would have used that phrase in section
 - 50 -

6330(b) (and section 6320(b)), or at least referred to section

7521. It did neither.5

5
At a minimum, if Congress had intended for the Appeals
hearing under sec. 6330(b) (and sec. 6320(b)) to constitute an
“in-person interview” for purposes of sec. 7521, Congress would
have so stated in the legislative history of sec. 6330(b) (and
sec. 6320(b)). It did not.

The fact that from 1989 until May 2002 IRS Appeals exercised
its discretionary authority and permitted audio recordings of
hearings before it does not mean that the IRS’s position was that
sec. 7521(a)(1) required such audio recordings. That was made
clear in Notice 89-51, 1989-1 C.B. 691 (Notice 89-51), and
Litigation Guideline Memorandum GL-17.

Notice 89-51 states in part:

For purposes of section 7520 of the Code [later
redesignated section 7521], the term “taxpayer
interview” means a meeting between an officer or
employee of the Examination function, the Employee
Plans and Exempt Organization function, or the
Collection function of the Service, and a taxpayer or
authorized representative, as defined in section
7520(b)(2), when the determination or the collection of
any tax is at issue.

Litigation Guideline Memorandum GL-17 provides in part:

It is also our position that section 7521 does not
apply to an administrative appeals conference * * *

* * * IRM 8626 does not create any right to make a
verbatim recording; it simply states that the
Commissioner or his/her delegate has the discretion to
allow a recording. * * *

Since 1989 until May 2, 2002, when Appeals, in an
unpublished internal memorandum to all Appeals Area Directors,
exercised its discretionary authority to end the audio recording
of conferences or hearings before Appeals that it had previously
allowed, Notice 89-51 and Litigation Guideline Memorandum GL-17
represented the interpretation of the IRS that the phrase “in-
person interview” in sec. 7521 does not apply to any Appeals
(continued...)
 - 51 -

I shall not specifically address and explain why each of the

various reasons set forth by the majority for its holding under

section 7521(a)(1) is faulty. Suffice it to say that each of

those reasons erroneously is grounded and relies upon the

operation and purpose of section 6330 (and section 6320).

However, I shall address several of the reasons on which the

majority relies for its holding under section 7521(a)(1) because

several of them are not grounded solely in the operation and

purpose of section 6330 (and section 6320).

In support of its conclusion that the phrase “in-person

interview” in section 7521(a)(1) includes a hearing before

Appeals under section 6330(b) (and section 6320(b)), the majority

states:

respondent’s interpretation of section 7521(a)(1) would
lead to the anomalous result of allowing the audio
recording of Examination Division interviews, which are
proceedings that we typically do not review, see
Greenberg’s Express, Inc. v. Commissioner, 62 T.C. 324,
327 (1974), but not allowing the recording of section
6330 hearings, which are proceedings that we are

5
(...continued)
conference or hearing but applies only to in-person audit
interviews and in-person collection interviews. Congress is
presumed to have had knowledge of that interpretation by the IRS
of the phrase “in-person interview” in sec. 7521 when in 1998 it
added the provisions for a hearing before Appeals in sec. 6330(b)
(and sec. 6320(b)) without mentioning sec. 7521 and by using the
term “hearing” instead of “interview”. See Fla. Natl. Guard v.
Fed. Labor Relations Auth., 699 F.2d 1082, 1087 (11th Cir. 1983)
(“Congress is deemed to know the executive and judicial gloss
given to certain language and thus adopts the existing
interpretation unless it affirmatively acts to change the
meaning.”).
 - 52 -

statutorily charged with reviewing, see sec.
6330(d)(1).

Majority op. p. 15.

The foregoing statement is incorrect. We are no more charged

with reviewing “section 6330 hearings” than we are charged with

reviewing “Examination Division interviews”. In the lien and

levy proceeding context, we are charged with reviewing a

determination of Appeals made under section 6330(c)(3). See sec.

6330(d)(1). That determination is set forth in the notice of

determination that Appeals issues to each taxpayer who has

complied with the requirements of section 6330 (and/or section

6320). In the deficiency context, we are charged with reviewing

a notice of deficiency, see sec. 6213(a); we are not charged with

reviewing “Examination Division interviews”. The case cited by

the majority, Greenberg’s Express, Inc. v. Commissioner, 62 T.C.

324, 327 (1974), merely holds that, in reviewing a notice of

deficiency, we typically do not go behind that notice.6

6
In reviewing a notice of deficiency under sec. 6213, our
standard of review is usually de novo. There are, however,
instances in which, in reviewing a notice of deficiency, our
standard of review is abuse of discretion (for example, in cases
involving a change in accounting method determined by the IRS).
Regardless of whether our standard of review in a deficiency case
is de novo or abuse of discretion, we typically do not go behind
the notice of deficiency. Greenberg’s Express, Inc. v.
Commissioner, 62 T.C. 324, 327 (1974).

In reviewing a notice of determination under sec. 6330, our
standard of review is abuse of discretion, unless the validity of
the underlying tax liability is properly placed at issue, in
(continued...)
 - 53 -

As another reason for concluding that the phrase “in-person

interview” in section 7521(a)(1) includes a hearing before the

Appeals Office under section 6330(b) (and section 6320(b)), the

majority states:

respondent’s interpretation of section 7521(a)(1) would
complicate judicial review of the determination made by
the Appeals Office with respect to the Commissioner’s
proposed levy or filing of the notice of Federal tax
lien. For example, when a taxpayer’s underlying tax
liability is not properly at issue in the
administrative hearing, we review the Appeals Office’s
determination for abuse of discretion. * * * Having a
transcript of the administrative hearing would
certainly facilitate that review. * * *

Majority op. pp. 15-16.

The foregoing rationale for holding that section 7521(a)(1)

requires the IRS to permit a taxpayer to make an audio recording

of an Appeals hearing under section 6330(b) (and section 6320(b))

is not sound. Although having a transcript of the administrative

hearing under section 6630(b) (and section 6320(b)) might

“facilitate” in an appropriate case review of the Appeals’

determination made under section 6330(c)(3), it is a non sequitur

to conclude that, therefore, section 7521(a)(1) requires that a

taxpayer have the right to make an audio recording of a hearing

6
(...continued)
which event our standard of review is de novo. Sego v.
Commissioner, 114 T.C. 604, 610 (2000); Goza v. Commissioner, 114
T.C. 176, 181-182 (2000). Regardless of whether our standard of
review in a proposed levy (or lien) case is abuse of discretion
or de novo, we typically do not go behind the notice of
determination.
 - 54 -

under section 6330(b) (and section 6320(b)). If the majority had

concluded, as I believe it should have, that the phrase “in-

person interview” in section 7521(a)(1) does not include a

hearing before Appeals, the Court would be at liberty in any

appropriate case under section 6330 (or section 6320), in order

to “facilitate” our review of Appeals’s determination under

section 6330(d)(1), to remand the case in order to have a

transcript of the section 6330 hearing (or section 6320 hearing).

See Mesa Oil, Inc. v. United States, 86 AFTR 2d 2000-7312, 2001-1

USTC par. 50130 (D. Colo. 2000).

The majority also states as a ground for concluding that

section 7521(a)(1) requires that a taxpayer have the right to

make an audio recording of a hearing before Appeals that

when reviewing for abuse of discretion, we generally
consider “only arguments, issues, and other matter that
were raised at the collection hearing or otherwise
brought to the attention of the Appeals Office”. * * *
Having a transcript would eliminate a possible dispute
between the parties concerning the scope of the issues
that were raised by the taxpayer in the administrative
hearing. Moreover, not having a transcript may
contravene the intent of Congress in providing for a
fair and impartial administrative hearing and may have
a negative impact on this Court’s review of the Appeals
Office determination.

Majority op. p. 16.

The foregoing rationale is another unsound basis for the

majority’s holding under section 7521(a)(1). As discussed above,

Congress could not have had in mind the hearing that it decided

to afford to taxpayers in 1998 under section 6330(b) (and section
 - 55 -

6320(b)) when it made section 7521 part of the Code in 1988.

Moreover, as also discussed above, the desirability in certain

circumstances of having a transcript of a section 6330 hearing

(and a section 6320 hearing) does not answer the question

whether, and does not logically lead to the conclusion that,

section 7521 mandates that a taxpayer have the right to make an

audio recording of a hearing before Appeals.

Having held that section 7521(a)(1) requires respondent to

allow petitioner to make an audio recording of his section

6330(b) hearing, the majority concludes:

we shall remand this case to respondent’s Appeals
Office with direction that petitioner be offered a
section 6330 hearing that may be audio recorded
pursuant to section 7521(a)(1).[7]

Majority op. pp. 17-18.

The result mandated by the majority is that respondent must offer

another hearing under section 6330 to petitioner, who, according

to the majority, has a long history of advancing tax-protester

7
In reaching the result to remand for an Appeals hearing
that petitioner may audio record, the majority relies on
respondent’s acknowledgment that if the Court were to decide the
audio recording issue against respondent, the proper action would
be to remand the case and allow petitioner to have a hearing that
he may audio record. Respondent’s position as to what the Court
should do if it were to hold against respondent on the issue
presented under sec. 7521(a)(1) is not binding on the Court and
does not justify remanding the case to Appeals. The Court has
never hesitated in the past, and the majority should not have
hesitated in the instant case, to reject the IRS’s (or the
taxpayer’s) view of what the proper action should be in the event
that the Court were to resolve an issue adversely to that party.
 - 56 -

types of contentions and arguments, so that he can make an audio

recording of that hearing. Such a result is justified, according

to the majority, because the IRS deprived petitioner of his

procedural right under section 7521(a)(1) to make an audio

recording of the hearing that Appeals previously offered to him.

However, in Lunsford v. Commissioner, 117 T.C. 183 (2001), the

Court (1) did not care whether the IRS had provided the taxpayers

with their substantive right to a hearing under section 6330(b)

and (2) refused to grant their request for relief that the Court

remand the case to Appeals for a hearing. The Court justified

such a result in Lunsford because “the only arguments that

petitioners presented to this Court were based on legal

propositions which we have previously rejected”, Lunsford v.

Commissioner, supra at 189, and consequently such a hearing was

not “necessary or productive”, id.

I believe that the result in Lunsford and the result in the

instant case are irreconcilable. In an effort to reconcile such

results, the majority points out that there is a difference

between Lunsford and the instant case in that the petition in

Lunsford alleged groundless legal arguments on which the

taxpayers in Lunsford based their claim for relief for another

hearing, whereas in the instant case the sole allegation in the

petition relates to a procedural defect; i.e., respondent’s

failure to allow petitioner to make an audio recording of his
 - 57 -

Appeals hearing. The difference on which the majority relies to

support its remand in the instant case is a distinction without

significance. We have previously reminded taxpayers who

institute proposed levy (and lien) cases in the Court that Rule

331(b)(4) requires a petition for review of a determination under

section 6330 to contain clear and concise assignments of “each

and every error which the petitioner alleges to have been

committed in the levy determination”, Goza v. Commissioner, 114

T.C. 176, 183 (2000), and that that Rule provides that “any issue

not raised in the assignments of error shall be deemed to be

conceded”, id. See Lunsford v. Commissioner, supra at 190.

By remanding the instant case to Appeals for a hearing that

petitioner may audio record, the majority is allowing petitioner

to raise issues that he did not raise or plead, as required by

Rule 331. The only complaint that petitioner has about his

rights under section 6330, as set forth in the petition in the

instant case, is that he was not allowed to make an audio

recording of his Appeals Office hearing under section 6330(b).

Certainly, petitioner does not intend to argue at the Appeals

hearing ordered by the majority that Appeals erred in refusing to

permit him to make an audio recording of the hearing that Appeals

previously offered to him. So what will petitioner argue at the

hearing mandated by the majority? Given petitioner’s track

record of advancing frivolous and/or groundless contentions and
 - 58 -

arguments as to why he does not owe any tax, it is reasonable to

presume that he will be advancing at that hearing those same

types of frivolous and/or groundless contentions and arguments.

In Lunsford v. Commissioner, supra, the Court did not give

the taxpayers the benefit of the doubt that they would abandon

their frivolous and/or groundless arguments if they had the

opportunity for another hearing. Nonetheless, the majority in

the instant case is giving petitioner the benefit of the doubt by

requiring Appeals to hold a hearing that petitioner may audio

record because the majority presumes that, despite petitioner’s

long history of advancing tax-protester types of contentions and

arguments, he might decide to advance at such a hearing

contentions and arguments that have some basis in the facts and

the law. I do not believe that the majority should have given

the benefit of the doubt to petitioner. The majority should have

required petitioner to amend his petition or otherwise advise the

Court what contentions and arguments he intends to make at an

Appeals hearing so that the Court could have determined whether

such contentions and arguments are frivolous and/or groundless.

Only if the Court were to determine that such contentions and

arguments have a basis in the facts and the law should the

majority have remanded the matter to Appeals for a hearing that

the majority has held section 7521(a)(1) requires petitioner be

given the opportunity to audio record. By not requiring before
 - 59 -

remanding this matter to Appeals that petitioner amend his

petition or otherwise inform the Court what contentions and

arguments he intends to make at an Appeals hearing, the majority

has rewarded petitioner’s delaying tactics and his noncompliance

with Rule 331 and has caused an unwarranted delay in the instant

proceedings.

COHEN and SWIFT, JJ., agree with this dissenting opinion.