T.C. Memo. 2003-279
UNITED STATES TAX COURT
CURTIS J.L. MCINTOSH, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 10131-01L. Filed September 25, 2003.
Curtis J.L. McIntosh, pro se.
Stephen J. Neubeck, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
THORNTON, Judge: Pursuant to section 6330(d), petitioner
seeks review of respondent’s determination to proceed with
collection of his 1990 income tax.1
1
Unless otherwise indicated, all section references are to
the Internal Revenue Code, as amended.
- 2 -
FINDINGS OF FACT
The parties have stipulated most of the facts, which we
incorporate herein by this reference. When petitioner filed his
petition, he resided in Hamilton, Ohio.
A. 1990 Notice of Deficiency
Petitioner filed no tax return for the 1990 tax year. On
November 25, 1992, respondent mailed to petitioner a notice of
deficiency in regard to his 1990 income tax. Respondent mailed
the notice to 2325 Anderson Road, Apartment 240, Crescent
Springs, Kentucky (the Kentucky address). This was the address
listed on petitioner’s 1988 Federal income tax return, his then
most recently filed return.
On December 10, 1992, the notice of deficiency was returned
to respondent marked “Not Deliverable”. Respondent inquired of a
credit bureau and obtained an address for a Curtis McIntosh at
2036 Parkamo Avenue, Hamilton, Ohio (the Ohio address). On
January 19, 1993, respondent verified the Ohio address with the
postmaster. On February 19, 1993, respondent sent petitioner a
letter requesting that he verify the Ohio address. Respondent
received no response to this request and did not resend the
notice of deficiency.
B. Notice and Demand for Payment
On April 26, 1993, respondent mailed to petitioner, at the
Kentucky address, a notice of balance due and demand for payment
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with regard to his 1986, 1990, and 1991 tax liabilities. This
notice was returned marked “No Longer At This Address/Addressee
Unknown”.
On September 22, 1993, respondent sent petitioner a Final
Notice (Notice of Intent to Levy) by certified mail to the Ohio
address. On September 27, 1993, petitioner signed for the
notice. In October of 1993, petitioner’s address in respondent’s
master file was changed to the Ohio address after a collection
officer verified that the address was valid.
C. First Levy and Sale
On July 24, 1995, respondent levied upon petitioner’s home
and vehicle (the property). On October 6, 1995, respondent sold
the property by sealed bid to Alum Cliff Industries (ACI).
Petitioner was never personally served with notice of the sale.
Respondent applied $10,583.24 of the sale proceeds to
petitioner’s unpaid 1990 tax liability.
D. Reversal of Sale and of Credit to Petitioner’s Tax Account
In 1995, petitioner brought suit in the U.S. District Court
for the Southern District of Ohio against various defendants,
including the Internal Revenue Service (IRS) and ACI. See
McIntosh v. United States, 82 AFTR 2d 98-6501 (S.D. Ohio 1998).
In this suit petitioner sought, among other things, to quiet
title to the property. Admitting procedural irregularities in
failing to provide petitioner with notice of the sale of the
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property, the IRS repurchased the property from ACI and in early
1998 returned title to petitioner. Respondent also reversed the
$10,583.24 credit to petitioner’s 1990 tax account that had been
generated by the prior seizure and sale of the property.
E. Renewed Collection Activity
On March 23, 1998, respondent notified petitioner of a
$13,133.52 balance due on his 1990 tax assessment and demanded
payment. On April 13, 1998, respondent sent petitioner notice
that the property would be levied upon again if he did not pay
his outstanding 1990 tax liability.
F. Petitioner’s Unsuccessful Effort To Enjoin Collection
Activity
Petitioner’s aforementioned suit in the District Court was
still pending when the IRS returned the property to him and
notified him that it intended to levy upon the property again.
Petitioner moved the District Court for a temporary restraining
order and a preliminary injunction to prevent the IRS from
proceeding in this collection activity. As a basis for this
motion, petitioner alleged that the IRS had failed to mail a
notice of deficiency for 1990 to his last known address and to
mail a statutory notice of assessment and demand for payment to
his last known address within 60 days of assessment, pursuant to
section 6303(a). The District Court denied petitioner’s motion.
See id. In its opinion, issued September 17, 1998, the District
Court found, among other things, that respondent mailed a timely
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notice of deficiency for 1990 to petitioner’s last known address.
Id. at 98-6510.2
G. Final Notice
On April 7, 1999, respondent sent petitioner a Final Notice-
-Notice of Intent to Levy and Notice of Your Right to a Hearing
with respect to petitioner’s unpaid 1986 and 1990 tax
liabilities.
H. Appeals Office Hearing
On May 7, 1999, petitioner timely filed a Form 12153,
Request for a Collection Due Process Hearing, with respect to his
1986 and 1990 taxes. In the Form 12153, petitioner indicated
that he disagreed with the notice of intent to levy with respect
to his 1986 tax liability because, among other reasons, no notice
of deficiency had been issued. With respect to his 1990 tax
liability, petitioner indicated that he disagreed with the notice
of intent to levy for the following reasons: “No notice of
assessment and demand for payment sent to last known address
within 60 days of assessment, IRS received payment, lien is
invalid, IRS lacks authority to conduct administrative seizure.”
2
Although it would appear to have been unnecessary for its
disposition of petitioner’s motion, the U.S. District Court for
the Southern District of Ohio also found that no notice of
deficiency was issued to petitioner for 1986 or 1991. McIntosh
v. United States, 82 AFTR 2d 98-6501, at 98-6503 (S.D. Ohio
1998).
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On March 9, 2000, petitioner attended an Appeals Office
hearing in Cincinnati, Ohio, conducted by Appeals Officer William
C. Roll. On July 21, 2000, the Appeals Office mailed to
petitioner a Notice of Determination Concerning Collection
Action(s) Under Section 6320 and/or 6330 (notice of
determination). The notice of determination states in pertinent
part:
The assessments for 1986 are invalid, and no collection
action will be enforced.
For 1990, the assessments are valid. In your appeal,
you did not raise any alternative collection method to
enforce collection, and the proposed levy should be
enforced.
An attachment to the notice of determination states in pertinent
part:
A valid notice of deficiency [for 1990] was issued, and
assessments were made in accordance with legal and
procedural requirements. The deficiency notice was
mailed to your last known address, at the time the
notice was mailed. Your failure to file current
returns prevented an update of your address, so that
you failed to receive notices of demand for payment.
Your failure to receive the notices mailed to your last
known address does not invalidate the assessments. The
legal and procedural requirements for 1990 have been
met.
* * * * * * *
It is determined that a deficiency notice for 1990 was
mailed timely to your last known address. Your failure
to file any tax return after 1989, and failure to
cooperate in acknowledging your new address,
contributed to the lack of your current address being
in the files of the Internal Revenue Service. Because
notices were issued to your last known address as of
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the date they were issued, the assessments for 1990 are
valid.
I. Petitioner Seeks Review in Wrong Court
On August 18, 2000, petitioner filed a complaint in the
District Court seeking review of respondent’s determination to
proceed with collection of his 1990 taxes. On July 11, 2001, the
District Court dismissed the complaint with prejudice for lack of
subject matter jurisdiction.
J. Tax Court Petition
On August 14, 2001, petitioner timely petitioned this Court
to review respondent’s determination to proceed with collection
of his 1990 taxes. In his petition, petitioner claims that: (1)
No one representing the IRS attended the Appeals Office hearing;3
(2) the Appeals officer “did not obtain verification at the
hearing from the Secretary indicating that the requirements of
any applicable law or administrative procedure had been met as
required by 26 U.S.C. §6330(c)(1), nor was petitioner shown any
such evidence”; (3) respondent did not issue a notice of
assessment and demand for payment as required by section 6303;
and (4) respondent has already received payment for petitioner’s
1990 tax liabilities.
3
Petitioner did not raise this issue at trial or on brief;
therefore, we deem petitioner to have abandoned it. See Burbage
v. Commissioner, 82 T.C. 546, 547 n.2 (1984), affd. 774 F.2d 644
(4th Cir. 1985); Wolf v. Commissioner, T.C. Memo. 1992-432, affd.
13 F.3d 189 (6th Cir. 1993).
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OPINION
A. Applicable Law
If any person neglects or refuses to make payment of any
assessed Federal tax liability within 10 days of notice and
demand, the Secretary is authorized to collect the assessed tax
by levy on the person’s property. Sec. 6331(a). At least 30
days before taking such action, however, the Secretary generally
must provide the person with a written final notice of intent to
levy that describes, among other things, the administrative
appeals available to the person. Sec. 6331(d)(1), (4). The
written final notice must be given in person, left at the
person’s dwelling or usual place of business, or sent by
certified or registered mail to the person’s last known address.
Sec. 6331(d)(2).
Upon request, the person is entitled to an administrative
hearing before the Appeals Office of the IRS. Sec. 6330(b)(1).
If dissatisfied with the Appeals Office determination, the person
may seek judicial review in the Tax Court or a Federal District
Court, as appropriate. Sec. 6330(d). Generally, the proposed
levy actions are suspended for the pendency of the hearing and
any judicial appeals therein. Sec. 6330(e)(1).
Section 6330(c) prescribes the matters that a person may
raise at an Appeals Office hearing, including spousal defenses,
the appropriateness of the Commissioner’s intended collection
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action, and possible alternative means of collection. A taxpayer
may contest the existence or amount of the underlying tax
liability at an Appeals Office hearing only if the taxpayer did
not receive any statutory notice of deficiency for the tax
liability or did not otherwise have an opportunity to dispute the
tax liability. Sec. 6330(c)(2)(B); see Sego v. Commissioner, 114
T.C. 604, 609 (2000); Goza v. Commissioner, 114 T.C. 176, 180-181
(2000). Moreover, except in certain limited circumstances, a
person is generally precluded from raising at the Appeals Office
hearing any issue raised and considered in any previous
administrative or judicial proceeding. Sec. 6330(c)(4).
Where the validity of the underlying tax liability is
properly at issue, we review that issue de novo. See Sego v.
Commissioner, supra at 610. Other issues we review for abuse of
discretion. Id. On brief, petitioner acknowledges that he “has
not challenged the validity of the tax liability” and that we
should review respondent’s determination in this collection
proceeding for abuse of discretion.
B. Verification Requirement
Petitioner contends that the Appeals officer failed to
obtain verification from the Secretary that the requirements of
all applicable laws and administrative procedures had been met as
required by section 6330(c)(1).
Section 6330(c)(1) does not require the Commissioner to rely
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on a particular document to satisfy the verification requirement
contained therein. See, e.g., Hauck v. Commissioner, T.C. Memo.
2002-184, affd. 64 Fed. Appx. 492 (6th Cir. 2003). It is well
established that the Commissioner may rely on transcripts of
account to satisfy the section 6330(c)(1) verification
requirement. See id. (and cases cited therein). Section
6330(c)(1) does not require the Appeals officer to provide the
taxpayer with a copy of the verification at the hearing. Sec.
301.6330-1(e)(1), Proced. & Admin. Regs.; see Nestor v.
Commissioner, 118 T.C. 162, 166 (2002).
The administrative file developed by respondent’s Appeals
Office in connection with petitioner’s request for a collection
hearing contains, among other things, transcripts of petitioner’s
account for taxable year 1990. Among these transcripts are a so-
called IMFOLT file dated March 9, 2000, and a literal transcript
dated March 6, 2000. These transcripts indicate, among other
things, that petitioner filed no 1990 Federal income tax return,
and that on April 26, 1993, respondent made a substitute for
return and assessed petitioner’s 1990 income tax liability (and
related penalties and interest). The transcripts reflect no
payments on petitioner’s account other than the $10,583.24
credited to petitioner’s account on October 6, 1995 (the date
that respondent sold the property to ACI). The literal
transcript shows that this credit was reversed in 1998
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(retroactive to April 26, 1993) as a payment “processed in error”
(consistent with respondent’s return of the property to
petitioner in 1998). Petitioner alleges no irregularity in these
transcripts that would raise a question about the information
contained therein. Moreover, the record contains a copy of the
notice of deficiency issued to petitioner with respect to his
1990 taxes and shows that as part of his verification process the
Appeals officer appropriately considered the District Court’s
finding in McIntosh v. United States, 82 AFTR 2d 98-6501, at 98-
6510, that the notice of deficiency for 1990 was timely issued to
petitioner at his last known address.
The record also contains three copies of Form 4340,
Certificate of Assessments and Payments, of petitioner’s 1990
account dated April 16, 1996, May 29, 1998, and October 4, 2002.
Petitioner received these Forms 4340 at various times before and
after his Appeals Office hearing. Such certificates of
assessments and payments “are generally regarded as being
sufficient proof, in the absence of evidence to the contrary, of
the adequacy and propriety of notices and assessments that have
been made.” Gentry v. United States, 962 F.2d 555, 557 (6th Cir.
1992); see Schroeder v. Commissioner, T.C. Memo. 2002-190;
Kaeckell v. Commissioner, T.C. Memo. 2002-114. Petitioner
contends that various circumstances show that the Forms 4340 lack
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trustworthiness. We are unpersuaded by petitioner’s arguments in
this regard.4
We conclude that the various transcripts and other materials
in the administrative file, as well as the District Court’s
opinion in McIntosh v. United States, 82 AFTR 2d 89-6501 (S.D.
Ohio 1998), and the various Forms 4340 in evidence establish that
respondent properly assessed petitioner’s 1990 tax liability.
Petitioner has not shown any irregularity in respondent’s
assessment procedures that raises a question about the validity
of the 1990 assessment.
In contesting the Appeals Office determination that the
legal and procedural requirements for 1990 have been met, the
only specific issues that petitioner has raised in this
proceeding relate to his contentions that notice and demand was
not sent to his last known address and that his 1990 tax
liability has previously been extinguished. As discussed in
4
For example, petitioner contends that, contrary to
information contained in the Forms 4340, notice and demand was
not timely sent to his last known address–-a contention that we
address and reject in Sec. C of this opinion. As another
example, petitioner notes that his most recently received Form
4340, dated Oct. 4, 2002, fails to list the final notice of
intent to levy that he received in late September 1993. There is
nothing to suggest, however, that the issuance of a final notice
of intent to levy is an event that the Commissioner always
records in a Form 4340. Cf. Keene v. Commissioner, T.C. Memo.
2002-277 (omission of issuance of notice of deficiency from a
Form 4340 did not render the Form 4340 suspect). In any event,
the final notice of intent to levy is part of the administrative
file that the Appeals officer relied upon in making his
determination.
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detail below, these contentions are without merit.
C. Notice and Demand--Last Known Address Requirement
Petitioner contends that he received no notice and demand
for payment of his 1990 taxes at his last known address within 60
days of assessment as required by section 6303(a).5
Consequently, petitioner contends, respondent had no “authority
to collect an assessed tax through administrative proceedings.”
As a general rule, the Commissioner is entitled to treat the
address on a taxpayer’s most recent return as the taxpayer’s last
known address, unless the taxpayer has given “clear and concise
notification of a different address.” Abeles v. Commissioner, 91
T.C. 1019, 1035 (1988). If the Commissioner learns that a
taxpayer is not residing at the address shown on the taxpayer’s
most recent return, the Commissioner must exercise reasonable
care and diligence in ascertaining the taxpayer’s new address.
See Keeton v. Commissioner, 74 T.C. 377, 382 (1980).
5
Sec. 6303(a) provides:
SEC. 6303(a). General Rule.--
Where it is not otherwise provided by this title,
the Secretary shall, as soon as practicable, and within
60 days, after the making of an assessment of a tax
pursuant to section 6203, give notice to each person
liable for the unpaid tax, stating the amount and
demanding payment thereof. Such notice shall be left
at the dwelling or usual place of business of such
person, or shall be sent by mail to such person’s last
known address.
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On his 1988 tax return, petitioner provided respondent the
Kentucky address. Petitioner failed to file a 1989 or 1990 tax
return or otherwise to inform respondent of a new address. After
the 1990 notice of deficiency was returned to respondent in
December 1992 marked “Not Deliverable”, respondent learned in
mid-January 1993 through U.S. Postal Service and credit bureau
information that a Curtis McIntosh lived at the Ohio address.
Petitioner failed to respond to respondent’s request, mailed to
the Ohio address, asking him to verify that this was his new
address.
In McIntosh v. United States, supra at 98-6510, the District
Court decided, on the basis of essentially these facts, that
respondent had exercised due diligence in attempting to ascertain
petitioner’s last known address for purposes of mailing the 1990
notice of deficiency. The District Court first concluded that
under relevant caselaw the IRS’s duty of diligence extended only
to the time that the 1990 notice of deficiency was mailed.
Applying that standard, the District Court held that “the only
reasonable conclusion” was that the IRS satisfied its duty,
inasmuch as petitioner had failed to notify the IRS that he had
moved from the Kentucky address. Id. Alternatively, the
District Court held that the same result would obtain even if the
IRS’s duty of diligence extended beyond the mailing of the notice
of deficiency. Noting that petitioner had failed to respond to
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the IRS’s address verification request sent to him at the Ohio
address, the District Court concluded: “There is no probative
evidence that the IRS had actual notice” of petitioner’s Ohio
address, even though respondent had received an Ohio address
through a credit bureau and a postal tracer. Id. The District
Court stated:
Accepting as true plaintiff’s allegation that he did
not receive the request for verification, it was
reasonable for the IRS to forego changing plaintiff’s
address on the master file until after other
verification had been obtained. Under these
circumstances, it must be held that the IRS exercised
reasonable care and diligence in ascertaining
plaintiff’s correct address subsequent to the mailing
of the Notice of Deficiency. The IRS cannot be held to
have shirked its duty by failing to mail the notice a
second time to an address which plaintiff did not
provide to the IRS and which he did not verify after
being extended the opportunity to do so. Accordingly,
the Court finds that the only reasonable conclusion is
that the IRS complied with 26 U.S.C. section 6212 prior
to making its assessment for that year. [Id.; fn. ref.
omitted.]
On April 26, 1993, respondent mailed notice and demand to
petitioner at the Kentucky address. It is undisputed that this
notice and demand was timely if mailed to petitioner’s last known
address. The Appeals Office relied upon and adopted the District
Court’s reasoning to determine that the notice and demand was
sent to petitioner’s last known address. On brief, petitioner
contends that the Appeals officer’s action in this regard was an
abuse of discretion because “The facts that existed at the time
of mailing the Notice of Deficiency did not exist at the time of
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mailing the Notice and Demand.” As just described, however, the
basis of the District Court’s decision was not limited to the
facts that existed at the time of the mailing of the notice of
deficiency. Rather, as an alternative basis for its holding, the
District Court also considered facts arising after the mailing of
the notice of deficiency (i.e., the return of the notice of
deficiency as undeliverable, the IRS’s attempts at address
verification through credit bureau contacts and postal tracers,
and petitioner’s failure to respond to the IRS’s address
verification request). Taking into account these additional
facts, the District Court decided that the “only reasonable
conclusion” is that the IRS satisfied its duty of diligence with
respect to the notice of deficiency. McIntosh v. United States,
supra at 98-6510.
In its opinion, the District Court stated:
There is an issue as to whether the IRS complied
with the statutory requirements for issuing a Notice
and Demand for 1990 based on the government testimony
presented at the hearing that the IRS sent notices of
demand for payment for 1990 to the * * * [Kentucky
address] after the Notice of Deficiency sent to that
same address had been returned as undeliverable. * * *
[Id. at 98-6511.]
Ultimately, however, the District Court did not decide this
issue, concluding that it lacked subject-matter jurisdiction over
the relief sought with respect to this matter.6 Id.
6
Petitioner contends that materials in the administrative
(continued...)
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As far as the record shows, the circumstances as of the date
respondent sent the notice and demand to the Kentucky address
were essentially unchanged from the circumstances considered by
the District Court in holding that the “the only reasonable
conclusion” was that respondent had sent the 1990 notice of
deficiency to petitioner’s last known address in Kentucky and had
not breached any duty of diligence by failing to resend it to the
Ohio address. Id. at 98-6510. In particular, the record does
not suggest that before mailing the notice and demand to the
Kentucky address respondent had received any additional
information from petitioner or from any other source that would
support a conclusion that respondent erred in failing to mail the
notice and demand to the Ohio address which petitioner had not
provided to respondent and which petitioner did not verify after
being extended the opportunity to do so. Accordingly, on the
instant record, we conclude, consistent with the District
6
(...continued)
file show that the Appeals officer assumed, incorrectly, that the
District Court had found that the notice and demand, as well as
the 1990 notice of deficiency, was mailed to petitioner’s last
known address. No such mistake is manifest in the notice of
determination itself or the attachment thereto, which refers
simply to petitioner’s failure to cooperate in acknowledging his
new address as contributing to the lack of his current address in
the IRS files. But regardless of whether the notice of
determination was predicated in part on this alleged misreading
of the District Court’s opinion, we conclude, as explained in the
text above, that timely notice and demand was sent to
petitioner’s last known address.
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Court’s reasoning, that respondent mailed the April 26, 1993,
notice and demand to petitioner’s last known address.
In light of our holding in this regard, we need not and do
not decide the effect, if any, of respondent’s alleged failure to
provide petitioner notice and demand within 60 days pursuant to
section 6303(a).7
7
Sec. 301.6303-1(a), Proced. & Admin. Regs., provides that
notice under sec. 6303(a) shall be given “as soon as possible and
within 60 days. However, the failure to give notice within 60
days does not invalidate the notice.” In several cases, without
expressly addressing the effect of the IRS’s failure to give
notice within 60 days of the subject assessment, this Court has
treated notice that was provided more than 60 days after the
subject assessment as satisfying, in whole or part, the notice
requirement of sec. 6303(a). See Perez v. Commissioner, T.C.
Memo. 2002-274; Hack v. Commissioner, T.C. Memo. 2002-244; Hack
v. Commissioner, T.C. Memo. 2002-243; Mudd v. Commissioner, T.C.
Memo. 2002-204. These decisions are consistent with decisions of
various other courts holding that notice provided more than 60
days after the subject assessment date satisfies the sec. 6303(a)
notice requirement. See Ramos v. United States, 84 AFTR 2d 99-
6402, 99-2 USTC par. 50,878 (N.D. Cal. 1999); Schupp v. United
States, 71 AFTR 2d 93-917, 93-1 USTC par. 50,215 (E.D. Tex.
1993), affd. without published opinion 58 F.3d 636 (5th Cir.
1995); Erickson v. United States, 780 F. Supp. 733 (W.D. Wash.
1990), affd. without published opinion 952 F.2d 1399 (9th Cir.
1992). On the other hand, various other courts have held that
the IRS’s failure to give notice within 60 days of the subject
assessment date bars the IRS from exercising its nonjudicial
collection powers but does not preclude the IRS from reducing the
subject assessment to judgment in a civil action. See Blackston
v. United States, 778 F. Supp. 244 (D. Md. 1991); Behren v.
United States, 764 F. Supp. 180, 183 (S.D. Fla. 1991) (stating
that sec. 301.6303-1(a), Proced. & Admin. Regs., “insofar as it
directly controverts statutory and case authority, is without any
precedential value”), affd. on this issue without published
opinion 992 F.2d 328 (11th Cir. 1993), on remand 74 AFTR 2d 94-
6370 (S.D. Fla. 1994); Dewberry v. United States, 158 Bankr. 979,
982 (Bankr. W.D. Mich. 1993); cf. Jersey Shore State Bank v.
United States, 479 U.S. 442 (1987) (the Government is not
(continued...)
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D. Whether Payment Has Been Made
Finally, petitioner alleges that the 1990 tax assessment was
extinguished when respondent seized and sold the property in
1995, notwithstanding that respondent subsequently returned the
property to petitioner. Petitioner also argues that section
6343(b) prohibited respondent from repurchasing the property from
ACI and consequently prohibited respondent from reversing the
credit of the purchase price previously applied to petitioner’s
1990 tax liability. As explained below, we reject both
arguments.
1. Extinguishment of Petitioner’s Assessment
Petitioner relies on several cases, including Clark v.
United States, 63 F.3d 83 (1st Cir. 1995), for the proposition
that his 1990 tax assessment was extinguished by the Government’s
initial seizure of the property in 1995, even though the property
was subsequently returned to him. The District Court in McIntosh
v. United States, 82 AFTR 2d 98-6501, at 98-6510, has previously
considered and rejected petitioner’s argument in this regard.
The District Court concluded:
Plaintiff’s position that the IRS cannot now levy
on his real property based on the same Notice of
Deficiency which preceded the initial seizure of that
property is not well-taken. Plaintiff relies on Clark
v. U.S., 63 F.3d 83 (1st Cir. 1985), for this
7
(...continued)
required to provide a lender with notice under sec. 6303(a)
before bringing a civil suit to collect a payroll borrower’s
unpaid withholding tax under sec. 3505).
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proposition. Clark held that an assessment may be
extinguished only by payment tendered by the taxpayer
and cannot be extinguished by an IRS error. Plaintiff
has not tendered payment, but seeks to preclude the IRS
from proceeding on the assessment for 1990 based on an
alleged IRS error. The authority cited by plaintiff
does not support his contention that in this situation,
the IRS is precluded from proceeding. [Id. at 98-6510
to 98-6511.]
Petitioner is collaterally estopped from relitigating this
issue in this Court. See Peck v. Commissioner, 90 T.C. 162,
166-167 (1988), affd. 904 F.2d 525 (9th Cir. 1990). In addition,
section 6330(c)(4) bars petitioner from raising this issue in
this collection proceeding.8
2. Section 6343(b)
Pursuant to section 6343(b), if the Secretary determines
that property was wrongfully levied upon, the Secretary is
authorized to return the property “at any time” or, if the
property has been sold, to return the amount of money received
8
With exceptions not relevant here, sec. 6330(c)(4) bars a
person from raising in a collection proceeding any issue that was
raised and considered at any other administrative or judicial
proceeding in which the person meaningfully participated. See
Katz v. Commissioner, 115 T.C. 329, 339 (2000). “Section
6330(c)(4) in effect codifies the legal doctrines of res judicata
and collateral estoppel in their application to collection
proceedings.” Wooten v. Commissioner, T.C. Memo. 2003-113.
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from the sale at any time within 9 months of the levy.9
Petitioner contends that under section 6343(b) respondent’s
repurchase of the property from ACI, occurring more than 9 months
after the initial sale to ACI, was “illegal” and that
consequently it was “illegal” for respondent to adjust his 1990
tax account by reversing the credit previously applied to his
account upon the sale of the property to ACI. We disagree.
Section 6343(b) was enacted as part of the Federal Tax Lien
Act of 1966, Pub. L. 89-719, sec. 104(i), 80 Stat. 1138. The
relevant legislative history states that section 6343(b)
“[authorizes] the Secretary of the Treasury or his delegate to
return to its rightful owner any property which has been
wrongfully levied upon by the United States.” H. Rept. 1884,
89th Cong., 2d Sess. (1966), 1966-2 C.B. 815, 860 (emphasis
9
Sec. 6343(b) provides:
SEC. 6343(b). Return of Property.--If the Secretary
determines that property has been wrongfully levied
upon, it shall be lawful for the Secretary to return--
(1) the specific property levied upon,
(2) an amount of money equal to the amount of
money levied upon, or
(3) an amount of money equal to the amount of
money received by the United States from a sale of
such property.
Property may be returned at any time. An amount equal
to the amount of money levied upon or received from
such sale may be returned at any time before the
expiration of 9 months from the date of such levy.
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supplied). Respondent’s repurchase of the property from ACI did
not constitute a return of the property (or its monetary
equivalent) to its rightful owner (presumably, petitioner).
Accordingly, section 6343(b) has no application to the repurchase
of the property from ACI. But even if we were to assume, for
sake of argument, that section 6343(b) should be given the
peculiar application that petitioner urges upon us, it would not
follow that, having returned petitioner’s property to him,
respondent would be barred from adjusting petitioner’s 1990 tax
account accordingly.
At bottom, this is a classic case of petitioner’s wishing to
have his cake and eat it too, while pretending that the
Government got it. The statute does not support this result;
logic, equity, and common sense oppose it.
All other arguments raised by petitioner and not expressly
discussed herein are without merit or unnecessary to reach.
To reflect the foregoing,
Decision will be
entered for respondent.