T.C. Memo. 2005-231
UNITED STATES TAX COURT
CAREY K. PARKER II, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 8214-04L. Filed October 3, 2005.
Carey K. Parker II, pro se.
Marty J. Dama, for respondent.
MEMORANDUM OPINION
VASQUEZ, Judge: Respondent sent petitioner a Decision
Letter Concerning Equivalent Hearing Under Section 6320 and/or
63301 for 1994, 1995, 1996, and 1997. The issue for decision is
whether the Court lacks jurisdiction under section 6330(d)(1)
with regard to the years in issue.
1
Unless otherwise indicated, all section references are to
the Internal Revenue Code.
- 2 -
Background
At the time he filed the petition, petitioner resided in
Arlington, Texas. Since at least 2000, petitioner has resided in
a private residence at 6411 Shorewood Drive, Arlington, Texas,
76016-2540117 (Shorewood address).
Petitioner failed to file income tax returns for 1994, 1995,
1996, and 1997. On October 22, 1996, respondent assessed
petitioner’s tax liability (including penalties and interest) for
1994, and on December 10, 2001, respondent assessed petitioner’s
tax liabilities (including penalties and interest) for 1995,
1996, and 1997.
On September 2, 2003, respondent mailed petitioner a notice
of intent to levy and right to a section 6330 hearing for 1994,
1995, 1996, and 1997 at the Shorewood address (hearing notice).
After receiving no response to the hearing notice, on
November 10, 2003, respondent mailed petitioner a Final Notice
Before Levy on Social Security Benefits. As of November 10,
2003, petitioner owed taxes, penalties, and interest totaling
$42,272.55, $42,698.46, $40,945.03, and $33,522.46 for 1994,
1995, 1996, and 1997, respectively.
On December 7, 2003, petitioner mailed respondent a Form
12153, Request for a Collection Due Process Hearing (dated
December 6, 2003) for 1994, 1995, 1996, and 1997 (hearing
request). Petitioner attached to the hearing request a 10-page
- 3 -
explanation of disagreement containing frivolous and groundless
arguments, including that he could not find any statute making
him liable for the taxes in issue and that he has no liability
for “income taxes”.
On March 22, 2004, respondent mailed petitioner a letter
advising petitioner that respondent had received petitioner’s
hearing request and that the issues and arguments he raised in
his hearing request are of the kind that courts have determined
are frivolous or groundless. In this letter, respondent directed
petitioner to a document entitled “The Truth About Frivolous Tax
Arguments” and a link to an IRS Web site containing this
document. Respondent scheduled a telephonic hearing for April 8,
2004, at 1 p.m. The letter further advised petitioner that if
the Appeals Office did not receive any further information from
petitioner or petitioner was not available when called for the
scheduled hearing, his case would be reviewed based on the
information in petitioner’s file.
On April 7, 2004, in response to respondent’s March 22,
2004, letter, a letter was mailed to respondent demanding a face-
to-face hearing. In the April 7, 2004, letter, petitioner did
not list any spousal defenses or collection alternatives, and he
did not list any nonfrivolous arguments regarding the
appropriateness of collection actions or his underlying tax
liabilities.
- 4 -
On April 13, 2004, respondent issued to petitioner the
decision letter. The decision letter advised petitioner that
respondent reviewed the proposed collection action for 1994,
1995, 1996, and 1997 and that petitioner received an equivalent
hearing because he did not file a request for a section 6330
hearing within the time prescribed under section 6320 and/or 6330
in order to receive a section 6330 hearing. The decision letter
further stated that petitioner did not raise any issues that were
relevant to paying his tax liability but that petitioner raised
only frivolous issues. The decision letter also stated that
petitioner had no right to dispute the decision of the Appeals
officer in court, cited Pierson v. Commissioner, 115 T.C. 576
(2000), to petitioner, and warned petitioner that if he appealed
the decision letter to the Tax Court, the Court is empowered to
impose sanctions up to $25,000 for instituting or maintaining an
action primarily for delay or taking a position that is frivolous
or groundless.
Petitioner petitioned the Court to dispute the decision
letter. Respondent filed a motion to dismiss for lack of
jurisdiction. Petitioner filed a response to respondent’s motion
to dismiss for lack of jurisdiction. Respondent filed a response
to petitioner’s response to respondent’s motion to dismiss for
lack of jurisdiction.
- 5 -
The Court held a hearing on respondent’s motion to dismiss
for lack of jurisdiction. At calendar call, respondent filed an
amendment to motion to dismiss for lack of jurisdiction.
Discussion
I. Decision Letter
Petitioner argues that respondent did not send him the
hearing notice as required by section 6330(a), that the first
collection notice he received was the Final Notice Before Levy on
Social Security Benefits, that he timely filed a hearing request
from the Final Notice Before Levy on Social Security Benefits,
that the decision letter is the functional equivalent of a notice
of determination, and accordingly that the Court has jurisdiction
over this case pursuant to section 6330.
Respondent submitted a document entitled “CDP Certified Mail
System Research” printed from respondent’s “CDP Certified Mail
Web Site” (Web site certified mail document). Respondent
submitted the Web site certified mail document because respondent
initially had difficulty obtaining a hard copy of the certified
mail list. The certified mail list was issued from the Memphis
Service Center, which no longer processes section 6330 cases, and
many section 6330 records issued from the Memphis Service Center
have been placed in storage. Respondent created the Web site
certified mail document by inputting into respondent’s computer
system the information contained in the certified mail list
- 6 -
before the certified mail list was placed in storage. The Web
site certified mail document lists: (1) Certified mail number
7107 3514 6973 1734 2376; (2) petitioner’s name and Social
Security number; (3) a letter dated September 1, 2003, that was
mailed to petitioner for 1994, 1995, 1996, and 1997; (4) a code
indicating that the mailing was a notice of intent to levy and
right to a hearing; and (5) that it was mailed to “ARLINGTON TX
76016-2540117.”
A few days before calendar call, respondent received a copy
of the certified mail list. Respondent submitted a copy of the
certified mail list to the Court and provided a copy to
petitioner. The certified mail list lists certified mail number
7107 3514 6973 1734 2376; petitioner’s name and Social Security
number; the mailing was mailed to the Shorewood address; and a
postmark dated September 2, 2003, from “Memphis, TN USPS 38101”.
Additionally, respondent submitted petitioner’s individual
master file literal transcripts of account for 1994, 1995, 1996,
and 1997. The transcripts of account for each year indicate that
petitioner was issued an “Intent to levy collection due process
notice levy notice” dated September 1, 2003. The transcripts of
account contain the same code number next to the “Intent to levy
collection due process notice levy notice” as is listed on the
Web site certified mail document.
- 7 -
Respondent relies on the Web site certified mail document,
the certified mail list, and the literal transcripts to establish
that on September 2, 2003, petitioner was mailed, via certified
mail, a hearing notice for 1994, 1995, 1996, and 1997 to the
Shorewood address. Petitioner admitted that the address listed
on the Web site certified mail document and certified mail list
is, and was in September 2003, his correct address. The Web site
certified mail document, the certified mail list, and the literal
transcripts are consistent and corroborate that respondent mailed
petitioner, via certified mail, the hearing notice no later than
September 2, 2003.
Petitioner claims that he did not receive the hearing
notice. Petitioner’s testimony is inconsistent with the
documentary evidence in the record. Orum v. Commissioner, 123
T.C. 1, 9 (2004), affd. on other grounds 412 F.3d 819 (7th Cir.
2005). The Court is not required to accept petitioner’s
unsubstantiated testimony. See Wood v. Commissioner, 338 F.2d
602, 605 (9th Cir. 1964), affg. 41 T.C. 593 (1964). The Court
need not accept at face value a witness’s testimony that is self-
interested or otherwise questionable. See Archer v.
Commissioner, 227 F.2d 270, 273 (5th Cir. 1955), affg. a
Memorandum Opinion of this Court; Weiss v. Commissioner, 221 F.2d
152, 156 (8th Cir. 1955), affg. T.C. Memo. 1954-51; Schroeder v.
Commissioner, T.C. Memo. 1986-467. After observing petitioner’s
- 8 -
demeanor at trial, we find his testimony on this point not to be
credible. See Orum v. Commissioner, supra at 9.
Accordingly, we find that on September 2, 2003, respondent
mailed petitioner the hearing notice for 1994, 1995, 1996, and
1997 to petitioner’s last known address, that petitioner received
it in due course, and that petitioner failed to file a timely
request for an Appeals Office hearing pursuant to section
6330(a)(2) and (3)(B) and (b).
A decision letter is not a determination letter pursuant to
section 6320 or 6330. See Orum v. Commissioner, supra at 7-12;
Kennedy v. Commissioner, 116 T.C. 255, 263 (2001); Offiler v.
Commissioner, 114 T.C. 492, 495 (2000). Respondent did not issue
a determination letter to petitioner sufficient to invoke the
Court’s jurisdiction to review the hearing notice for 1994, 1995,
1996, and 1997. Orum v. Commissioner, supra; Kennedy v.
Commissioner, supra. Accordingly, we shall dismiss the petition
for lack of jurisdiction on the ground that respondent did not
make a determination pursuant to section 6330 regarding the
hearing notice for 1994, 1995, 1996, and 1997 because petitioner
failed to file a timely request for an Appeals Office hearing
pursuant to section 6330(a)(2) and (3)(B) and (b). Orum v.
Commissioner, supra; Kennedy v. Commissioner, supra.
- 9 -
II. Section 6673
Section 6673(a)(1) authorizes this Court to require a
taxpayer to pay to the United States a penalty not to exceed
$25,000 if the taxpayer took frivolous or groundless positions in
the proceedings or instituted the proceedings primarily for
delay. A position maintained by the taxpayer is “frivolous”
where “it is contrary to established law and unsupported by a
reasoned, colorable argument for change in the law.” Coleman v.
Commissioner, 791 F.2d 68, 71 (7th Cir. 1986); see also Hansen v.
Commissioner, 820 F.2d 1464, 1470 (9th Cir. 1987) (section 6673
penalty upheld because taxpayer should have known claim was
frivolous).
Petitioner’s petition is replete with tax-protester
rhetoric. Petitioner has advanced shopworn arguments
characteristic of tax-protester rhetoric that has been
universally rejected by this and other courts. Wilcox v.
Commissioner, 848 F.2d 1007 (9th Cir. 1988), affg. T.C. Memo.
1987-225; Carter v. Commissioner, 784 F.2d 1006, 1009 (9th Cir.
1986).
Additionally, it is obvious to the Court that petitioner
litigated this case primarily for delay. Petitioner was advised
of our opinion in Pierson v. Commissioner, supra, and that he
could not litigate respondent’s decision in court.
- 10 -
We conclude that petitioner’s position was frivolous and
groundless and that petitioner instituted and maintained these
proceedings primarily for delay. Petitioner was duly warned that
his arguments were frivolous and groundless, that his case was
not appealable to the Court, and of the potential consequences of
his actions. Accordingly, pursuant to section 6673(a), we hold
petitioner is liable for a $1,000 penalty.
To reflect the foregoing,
An appropriate order and
order of dismissal will be
entered.