T.C. Memo. 2003-319
UNITED STATES TAX COURT
EDWIN E. AND BERTALINA ALVAREZ, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 13286-02L. Filed November 18, 2003.
Edwin E. Alvarez and Bertalina Alvarez, pro sese.
Irene Scott Carroll, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
GOEKE, Judge: The petition in this case was filed under
section 6330(d)1 in response to a Notice of Determination
Concerning Collection Action(s) Under Section 6320 and/or 6330
(the notice of determination). The issue for decision is whether
1
Unless otherwise indicated, all section references are to
the Internal Revenue Code currently in effect.
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the filing of a notice of federal tax lien (NFTL) was
appropriate.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulation of facts and the attached exhibits are
incorporated herein by this reference. Petitioners resided in
Bell Gardens, California, at the time their petition was filed.
On August 18, 1999, respondent issued a notice of deficiency
to petitioners determining a deficiency in Federal income tax and
an accuracy-related penalty for the taxable year 1996.
Petitioners filed a petition with this Court in response to the
notice of deficiency. However, petitioners’ case was ultimately
dismissed by the Court for lack of jurisdiction on the ground
that the petition was not timely filed. Petitioners’ 1998 return
was also audited, but they consented to the assessment of a tax
deficiency for that year.
On December 12, 2001, respondent sent to petitioners a
Notice of Federal Tax Lien Filing and Your Right to a Hearing
Under IRC 6320 for their taxable years 1996 and 1998. On January
18, 2002, petitioners requested a section 6330 hearing, stating
that they objected to the filed NFTL because “they never received
an audit notice[,] * * * did not receive a notice of deficiency
and would like an opportunity to dispute the tax liability.”
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On July 15, 2002, the Appeals Office issued the notice of
determination. The notice states that a hearing was held but
that the only challenge was to the existence or amount of the tax
liability for 1996. The Appeals officer ultimately determined
that the filing of the NFTL was appropriate.
OPINION
Under sections 6320 and 6330, a taxpayer is entitled to
notice and an opportunity for a hearing after an NFTL is filed by
the Commissioner in the process of collecting unpaid Federal
taxes. Section 6330(c)(2) designates the issues that the
taxpayer may raise at the Appeals hearing. In lien actions, the
taxpayer is allowed to raise any relevant issue relating to the
unpaid tax, including spousal defenses, challenges to the
appropriateness of the NFTL filing, and alternatives to
collection. Sec. 6330(c)(2)(A); sec. 301.6320-1(e)(1), Proced. &
Admin. Regs. The taxpayer “may also raise at the hearing
challenges to the existence or amount of the underlying tax
liability” if the taxpayer did not receive a notice of deficiency
or did not otherwise have an opportunity to dispute the tax
liability. Sec. 6330(c)(2)(B); sec. 301.6320-1(e)(1), Proced. &
Admin. Regs.
Where the existence or amount of the underlying tax
liability is properly at issue in the hearing, we review the
matter de novo. Sego v. Commissioner, 114 T.C. 604, 610 (2000);
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Goza v. Commissioner, 114 T.C. 176, 181-182 (2000). Where the
existence or amount of underlying tax liability is not properly
at issue, we review the determination for abuse of discretion.
Sego v. Commissioner, supra at 610; Goza v. Commissioner, supra
at 181-182.
With respect to tax year 1996, petitioners received a notice
of deficiency as reflected by the fact that they attached the
first page of that notice to their prior petition to this Court.
Accordingly, petitioners are not entitled to challenge their
underlying tax liability for 1996. Petitioners consented to the
assessment of their 1998 tax and are not challenging their
underlying liability for that year. Therefore, we review the
Appeals officer’s determination for abuse of discretion.
The notice of determination states that the only challenge
at the hearing was to the existence or amount of the 1996 tax
liability. At trial, petitioners did not dispute this statement,
and no collection alternatives, challenges to the appropriateness
of the NFTL filing, or spousal defenses were raised at the
hearing or at the trial. Accordingly, we hold that the Appeals
officer’s determination that the filing of the NFTL was
appropriate was not an abuse of discretion.
Decision will be entered
for respondent.