T.C. Memo. 2005-289
UNITED STATES TAX COURT
HAROLD E. CALL, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 19609-03L. Filed December 15, 2005.
P filed a petition for judicial review pursuant to
secs. 6320 and 6330, I.R.C., in response to a
determination by R to leave in place a filed notice of
Federal tax lien.
Held: Because P has advanced groundless
complaints in dispute of the filed notice of tax lien,
R’s determination to proceed with collection action is
sustained.
Held, further, a penalty under sec. 6673, I.R.C.,
is due from P and is awarded to the United States in
the amount of $5,000.
Harold E. Call, pro se.
Alan J. Tomsic, for respondent.
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MEMORANDUM FINDINGS OF FACT AND OPINION
WHERRY, Judge: This case arises from a petition for
judicial review filed in response to a Notice of Determination
Concerning Collection Action(s) Under Section 6320 and/or 6330.1
The issues for decision are: (1) Whether respondent may proceed
with collection action as so determined, and (2) whether the
Court, sua sponte, should impose a penalty under section 6673.
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The stipulations of the parties, with accompanying exhibits, are
incorporated herein by this reference.
Petitioner submitted to the Internal Revenue Service (IRS)
Forms 1040EZ, Income Tax Return for Single and Joint Filers With
No Dependents, for the 1998 and 1999 taxable years. On each of
these returns, petitioner reported $0 on substantially all
pertinent lines, including $0 of income and $0 of tax. The 1998
return also incorporated petitioner’s request for a refund of
$1,427, derived from income tax withholdings. Petitioner
attached to each return a statement contending, inter alia, that
no law established his liability for income taxes or required him
to file a return.
1
Unless otherwise indicated, section references are to the
Internal Revenue Code of 1986, as amended, and Rule references
are to the Tax Court Rules of Practice and Procedure.
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Respondent issued to petitioner by certified mail a
statutory notice of deficiency for 1998 on February 11, 2000, and
for 1999 on March 30, 2001. Petitioner did not file a petition
with this Court in response to either notice of deficiency, and
respondent assessed the taxes, additions to tax, penalty, and/or
interest for 1998 on August 14, 2000, and for 1999 on September
24, 2001. A notice of balance due was promptly sent to
petitioner with respect to each year.
Thereafter, respondent issued to petitioner a Notice of
Federal Tax Lien Filing and Your Right to a Hearing Under IRC
6320 regarding his unpaid liabilities for 1998 and 1999. On or
about April 16, 2003, petitioner submitted to respondent a Form
12153, Request for a Collection Due Process Hearing, setting
forth his disagreement with the lien. He challenged, among other
things, the validity of the assessments, the issuance of a
statutory notice of deficiency or notice and demand for payment,
and the authority of Internal Revenue Service personnel. A cover
letter with the Form 12153 indicated that petitioner had
initially attempted to respond to respondent’s proposed
collection activities by a letter dated March 26, 2003, and also
stated petitioner’s intention to record the requested hearing.
The Appeals officer to whom petitioner’s case had been
assigned subsequently scheduled a hearing for July 2, 2003, in
Las Vegas, Nevada. Petitioner appeared for the scheduled hearing
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on July 2, 2003, but the hearing did not proceed when the Appeals
officer refused to permit petitioner to record the meeting.
Following the aborted meeting, in a July 3, 2003, letter to the
Appeals officer, petitioner listed issues that he wished to have
considered before any determination was issued. The enumerated
matters largely reprised the challenges submitted with
petitioner’s Form 12153, disputing, e.g., underlying liability,
proper assessment, receipt of valid notices of deficiency and
demand for payment, verification from the Secretary that all
applicable legal and procedural requirements had been met, and
right to record.
On October 7, 2003, respondent issued to petitioner the
aforementioned Notice of Determination Concerning Collection
Action(s) Under Section 6320 and/or 6330, sustaining the proposed
lien action.
Petitioner’s petition disputing the notice of determination,
having been timely mailed, was filed with the Court on
November 12, 2003, and reflected an address in Las Vegas, Nevada.
In the petition and in an accompanying document filed as a motion
to dismiss for lack of jurisdiction, petitioner relied
principally on the claim that he was denied a proper hearing
under section 6330 due to the inability to record.2
2
Petitioner’s motion to dismiss for lack of jurisdiction
was denied by order of this Court on Jan. 22, 2004.
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On September 10, 2004, respondent filed a motion for summary
judgment. Petitioner filed a timely response in opposition to
respondent’s motion on October 12, 2004. The response again
essentially repeated petitioner’s demands for a recorded hearing
and documentation. The Court on November 10, 2004, issued an
order denying the motion for summary judgment, ruling as set
forth below:
As respondent correctly notes in the motion for
summary judgment, issues raised by petitioner during
the administrative process and before us have been
repeatedly rejected by this and other courts or are
refuted by the documentary record. Moreover, the Court
observes that maintenance of similar frivolous
arguments, primarily for delay, has served as grounds
for imposition of penalties under section 6673.
However, the case in its current posture does present a
procedural shortcoming.
On July 8, 2003, this Court issued Keene v.
Commissioner, 121 T.C. 8, 19 (2003), in which it was
held that taxpayers are entitled, pursuant to section
7521(a)(1), to audio record section 6330 hearings. The
taxpayer in that case had refused to proceed when
denied the opportunity to record, and we remanded the
case to allow a recorded Appeals hearing. Id. In
contrast, we have distinguished, and declined to
remand, cases where the taxpayer had participated in an
Appeals Office hearing, albeit unrecorded, and where
all issues raised by the taxpayer could be properly
decided from the existing record. E.g., id. at 19, 20;
Frey v. Commissioner, T.C. Memo. 2004-87; Durrenberger
v. Commissioner, T.C. Memo. 2004-44; Brashear v.
Commissioner, T.C. Memo. 2003-196; Kemper v.
Commissioner, T.C. Memo. 2003-195.
The circumstances of the instant case are
analogous to those in Keene v. Commissioner, supra, and
diverge from those where it was determined that remand
was not necessary and would not be productive.
Critically, the notice of determination was issued on
October 7, 2003. Although this date is subsequent to
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the opinion in Keene v. Commissioner, supra, petitioner
was not afforded an opportunity for a recorded
conference. Further, because the requested face-to-
face hearing was not held, there still exists a
possibility that petitioner might have raised one or
more nonfrivolous issues if the meeting had proceeded.
In this situation, the Court declines to
characterize the failure to allow recording as harmless
error. Hence, the Court will deny respondent’s motion
for summary judgment at this time. As in Keene v.
Commissioner, supra at 19, however, we admonish
petitioner that if he persists in making primarily
frivolous and groundless tax protester arguments in any
further proceedings with respect to this case, rather
than raising relevant issues, as specified in section
6330(c)(2), the Court may consider granting a future
motion for summary judgment. In such an instance, the
Court would also be in a position to impose a penalty
under section 6673(a)(1).
This case was called from the calendar of the trial session
of the Court in Las Vegas, Nevada, on December 6, 2004, and a
trial was held that afternoon. At the outset, the Court reminded
petitioner that respondent’s motion for summary judgment had been
denied by our November 10, 2004, order because recording was not
permitted, and we explained as follows:
THE COURT: And as of that time the arguments that
had been made by you in the record that I was reviewing
were deemed by me to be frivolous protester arguments
that had not been sustained by the Courts in other
cases, and whose precedent I have to follow.
* * * * * * *
THE COURT: But that clearly you were correct in
noting that you had the right to record your hearing
and that that right had not been afforded you, and
therefore you never got your face-to-face hearing,
which you are also entitled to.
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And so their motion for summary judgment was
denied. At this trial today, there is a verbatim
record being made, and if you have any other issues
that you wish to raise other than those that were in
your previous documents, this is your chance to raise
them.
If you don’t raise what I deem to be a legitimate
issue under Section 6330(c)(2), which I have
jurisdiction to consider, and I rule against you, then
other than your right to appeal to a Circuit Court of
Appeals, your case will be over.
So if you have any other additional issues that
you wanted to raise or discuss with the Appeals
Officer, you need to raise them here today so that I
can determine if this case should be remanded to
appeals to consider those issues, or if there is not
reason to remand the case because there is [sic] no
issues that I can’t adequately dispose of here at this
trial. All right?
The sole new issue specifically raised by petitioner at
trial was that the filing of the notice of tax lien was invalid
because he did not receive proper notification of this action
from respondent. Petitioner testified that he instead learned of
the filing from a credit watch service to which he subscribes and
which alerts him of adverse activity concerning his credit
report.
The parties subsequently filed posttrial briefs. Petitioner
recapitulated the position taken throughout these proceedings and
at trial, focusing once again on lack of a recorded hearing and
of sufficient notification, verification, and documentation of
procedural requisites.
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OPINION
I. Collection Actions
A. General Rules
Section 6321 imposes a lien in favor of the United States
upon all property and rights to property of a taxpayer liable for
tax where there exists a failure to pay the tax liability after
demand for payment. The lien generally arises at the time
assessment is made. Sec. 6322. Section 6323, however, provides
that such lien shall not be valid against any purchaser, holder
of a security interest, mechanic’s lienor, or judgment lien
creditor until the Secretary files a notice of lien with the
appropriate public officials. Section 6320 then sets forth
procedures applicable to protect taxpayers in lien situations.
Section 6320(a)(1) establishes the requirement that the Secretary
notify in writing the person described in section 6321 of the
filing of a notice of lien under section 6323. This notice
required by section 6320 must be sent not more than 5 business
days after the notice of tax lien is filed and must advise the
taxpayer of the opportunity for administrative review of the
matter in the form of a hearing before the IRS Office of Appeals.
Sec. 6320(a)(2) and (3). Section 6320(b) and (c) grants a
taxpayer, who so requests, the right to a fair hearing before an
impartial Appeals officer, generally to be conducted in
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accordance with the procedures described in section 6330(c), (d),
and (e).
Section 6330(c) addresses the matters to be considered at
the hearing:
SEC. 6330(c). Matters Considered at Hearing.--In
the case of any hearing conducted under this section--
(1) Requirement of investigation.--The
appeals officer shall at the hearing obtain
verification from the Secretary that the
requirements of any applicable law or
administrative procedure have been met.
(2) Issues at hearing.--
(A) In general.--The person may raise at
the hearing any relevant issue relating to
the unpaid tax or the proposed levy,
including--
(i) appropriate spousal defenses;
(ii) challenges to the
appropriateness of collection actions;
and
(iii) offers of collection
alternatives, which may include the
posting of a bond, the substitution of
other assets, an installment agreement,
or an offer-in-compromise.
(B) Underlying liability.--The person
may also raise at the hearing challenges to
the existence or amount of the underlying tax
liability for any tax period if the person
did not receive any statutory notice of
deficiency for such tax liability or did not
otherwise have an opportunity to dispute such
tax liability.
Once the Appeals officer has issued a determination
regarding the disputed collection action, section 6330(d) allows
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the taxpayer to seek judicial review in the Tax Court or a U.S.
District Court, depending upon the type of tax. In considering
whether taxpayers are entitled to any relief from the
Commissioner’s determination, this Court has established the
following standard of review:
where the validity of the underlying tax liability is
properly at issue, the Court will review the matter on
a de novo basis. However, where the validity of the
underlying tax liability is not properly at issue, the
Court will review the Commissioner’s administrative
determination for abuse of discretion. [Sego v.
Commissioner, 114 T.C. 604, 610 (2000).]
B. Analysis
1. Appeals Hearing
Hearings conducted under section 6330 are informal
proceedings, not formal adjudications. Katz v. Commissioner, 115
T.C. 329, 337 (2000); Davis v. Commissioner, 115 T.C. 35, 41
(2000). There exists no right to subpoena witnesses or documents
in connection with section 6330 hearings. Roberts v.
Commissioner, 118 T.C. 365, 372 (2002), affd. 329 F.3d 1224 (11th
Cir. 2003); Nestor v. Commissioner, 118 T.C. 162, 166-167 (2002);
Davis v. Commissioner, supra at 41-42. Taxpayers are entitled to
be offered a face-to-face hearing at the Appeals Office nearest
their residence. Where the taxpayer declines to participate in a
proffered face-to-face hearing, hearings may also be conducted by
telephone or correspondence. Katz v. Commissioner, supra at 337-
338; Dorra v. Commissioner, T.C. Memo. 2004-16; sec. 301.6330-
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1(d)(2), Q&A-D6 and D7, Proced. & Admin. Regs. Furthermore, once
a taxpayer has been given a reasonable opportunity for a hearing
but has failed to avail himself or herself of that opportunity,
we have approved the making of a determination to proceed with
collection based on the Appeals officer’s review of the case
file. See, e.g., Taylor v. Commissioner, T.C. Memo. 2004-25,
affd. 130 Fed. Appx. 934 (9th Cir. 2005); Leineweber v.
Commissioner, T.C. Memo. 2004-17; Armstrong v. Commissioner, T.C.
Memo. 2002-224; Gougler v. Commissioner, T.C. Memo. 2002-185;
Mann v. Commissioner, T.C. Memo. 2002-48. Thus, a face-to-face
meeting is not invariably required.
Regulations promulgated under section 6330 likewise
incorporate many of the foregoing concepts, as follows:
Q-D6. How are CDP hearings conducted?
A-D6. * * * CDP hearings * * * 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. * * *
Q-D7. If a taxpayer wants a face-to-face CDP
hearing, where will it be held?
A-D7. The taxpayer must be offered an opportunity
for a hearing at the Appeals office closest to
taxpayer’s residence or, in the case of a business
taxpayer, the taxpayer’s principal place of business.
If that is not satisfactory to the taxpayer, the
taxpayer will be given an opportunity for a hearing by
correspondence or by telephone. If that is not
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satisfactory to the taxpayer, the Appeals officer or
employee will review the taxpayer’s request for a CDP
hearing, the case file, any other written
communications from the taxpayer (including written
communications, if any, submitted in connection with
the CDP hearing), and any notes of any oral
communications with the taxpayer or the taxpayer’s
representative. Under such circumstances, review of
those documents will constitute the CDP hearing for the
purposes of section 6330(b). [Sec. 301.6330-1(d)(2),
Q&A-D6 and D7, Proced. & Admin. Regs.]
This Court has cited the above regulatory provisions, and
corresponding promulgations under section 6320, with approval.
See, e.g., Taylor v. Commissioner, supra; Leineweber v.
Commissioner, supra; Dorra v. Commissioner, supra; Gougler v.
Commissioner, supra.
With respect to the instant matter, the record reflects that
petitioner was provided with an opportunity for a face-to-face
hearing on July 2, 2003. The hearing did not proceed when
petitioner was not permitted to record the meeting. As explained
in our previous order in this case, in Keene v. Commissioner, 121
T.C. 8, 19 (2003), this Court held that taxpayers are entitled,
pursuant to section 7521(a)(1), to audio record section 6330
hearings. The taxpayer in that case had refused to proceed when
denied the opportunity to record, and we remanded the case to
allow a recorded Appeals hearing. Id.
In contrast, again as noted in our November 10, 2004, order,
we have distinguished, and declined to remand, cases where the
taxpayer had participated in an Appeals Office hearing, albeit
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unrecorded, and where all issues raised by the taxpayer could be
properly decided from the existing record. E.g., id. at 19-20;
Frey v. Commissioner, T.C. Memo. 2004-87; Durrenberger v.
Commissioner, T.C. Memo. 2004-44; Brashear v. Commissioner, T.C.
Memo. 2003-196; Kemper v. Commissioner, T.C. Memo. 2003-195.
Stated otherwise, cases will not be remanded to Appeals, nor
determinations otherwise invalidated, merely on account of the
lack of a recording when to do so is not necessary and would not
be productive. See, e.g., Frey v. Commissioner, supra;
Durrenberger v. Commissioner, supra; Brashear v. Commissioner,
supra; Kemper v. Commissioner, supra; see also Lunsford v.
Commissioner, 117 T.C. 183, 189 (2001). A principal scenario
falling short of the necessary or productive standard exists
where the taxpayers rely on frivolous or groundless arguments
consistently rejected by this and other courts. See, e.g., Frey
v. Commissioner, supra; Brashear v. Commissioner, supra; Kemper
v. Commissioner, supra.
Because no hearing had been conducted at all in petitioner’s
case, we declined to grant respondent’s motion for summary
judgment. The record as it then existed did not foreclose the
possibility that petitioner might have raised valid arguments had
a hearing been held. Accordingly, we provided petitioner an
opportunity before the Court at the trial session in Las Vegas to
identify any legitimate issues he wished to raise that could
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warrant further consideration of the merits of his case by the
Appeals Office or this Court. Petitioner, however, continued to
focus on the denial of a recorded hearing and offered no
substantive issues of merit.
Hence, despite repeated warnings and opportunities, the only
contentions other than the recorded hearing advanced by
petitioner are, as will be further discussed below, of a nature
previously rejected by this and other courts. The record
therefore does not indicate that any purpose would be served by
remand or additional proceedings. The Court concludes that all
pertinent issues relating to the propriety of the collection
determination can be decided through review of the materials
before it.
2. Review of Underlying Liabilities
Statutory notices of deficiency for 1998 and 1999 were
issued to petitioner by certified mail. Furthermore, statements
in the memorandum of law filed in support of petitioner’s
response to respondent’s earlier motion for summary judgment make
clear that he received the notices, despite assertions in various
other documents that might suggest the contrary. In addition,
the following colloquy on this subject took place at trial:
THE COURT: All right. I have one question, Mr.
Call. The order that I previously entered in your case
denying the motion for summary judgment noted that the
service had issued statutory notices of deficiencies to
you for both the years of ’98 and ’99.
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THE WITNESS: Yes, sir.
THE COURT: I believe that you received those
statutory notices of deficiency, and that you did not
file a petition with the U.S. Tax Court within the 90
day period--
THE WITNESS: No, sir, I was remiss in not doing
that.
THE COURT: --if you disagreed with the numbers on
those notices that probably or that would have been in
your best interest to file that.
THE WITNESS: That is not what I disagreed with.
It is some of the subsequent notices that I have gotten
and the figures don’t seem to add up.
Given these remarks, the Court is satisfied that petitioner
received the statutory notices and did not timely petition this
Court for redetermination when he had the opportunity to do so.
Accordingly, petitioner is precluded under section 6330(c)(2)(B)
from disputing his underlying 1998 and 1999 liabilities in this
proceeding. Other comments and contentions in the record
generally challenging the “existence” of any statute imposing or
requiring him to pay income tax warrant no further comment. See
Crain v. Commissioner, 737 F.2d 1417, 1417 (5th Cir. 1984) (“We
perceive no need to refute these arguments with somber reasoning
and copious citation of precedent; to do so might suggest that
these arguments have some colorable merit.”).
3. Review for Abuse of Discretion
Petitioner has also made various arguments relating to
aspects of the assessment and collection procedures that we
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review for abuse of discretion. Action constitutes an abuse of
discretion under this standard where arbitrary, capricious, or
without sound basis in fact or law. Woodral v. Commissioner, 112
T.C. 19, 23 (1999).
Federal tax assessments are formally recorded on a record of
assessment in accordance with section 6203. The Commissioner is
not required to use Form 23C in making an assessment. Roberts v.
Commissioner, 118 T.C. at 369-371. Furthermore, section
6330(c)(1) mandates neither that the Appeals officer rely on a
particular document in satisfying the verification requirement
nor that the Appeals officer actually give the taxpayer a copy of
the verification upon which he or she relied. Craig v.
Commissioner, 119 T.C. 252, 262 (2002); Nestor v. Commissioner,
118 T.C. at 166.
A Form 4340, Certificate of Assessments, Payments and Other
Specified Matters, for instance, constitutes presumptive evidence
that a tax has been validly assessed pursuant to section 6203.
Davis v. Commissioner, 115 T.C. at 40 (and cases cited thereat).
Consequently, absent a showing by the taxpayer of some
irregularity in the assessment procedure that would raise a
question about the validity of the assessments, a Form 4340
reflecting that tax liabilities were assessed and remain unpaid
is sufficient to support collection action under section 6330.
Id. at 40-41. We have specifically held that it is not an abuse
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of discretion for an Appeals officer to rely on Form 4340, Nestor
v. Commissioner, supra at 166; Davis v. Commissioner, supra at
41, or a computer transcript of account, Schroeder v.
Commissioner, T.C. Memo. 2002-190; Mann v. Commissioner, T.C.
Memo. 2002-48, to comply with section 6330(c)(1).
Here, the record contains Forms 4340 for 1998 and 1999,
indicating that assessments were made for each of these years and
that taxes remain unpaid. Although the Form 4340 for 1999
contains one labeling error explained by respondent in the notice
of determination, the error does not affect the existence of
valid, unsatisfied assessments.3 Petitioner has cited no further
irregularities that would cast doubt on the pertinent liability
information recorded the Forms 4340.
In addition to the specific dictates of section 6330, the
Secretary, upon request, is directed to furnish to the taxpayer a
copy of pertinent parts of the record of assessment setting forth
the taxpayer’s name, the date of assessment, the character of the
liability assessed, the taxable period, if applicable, and the
amounts assessed. Sec. 6203; sec. 301.6203-1, Proced. & Admin.
3
The assessment of income tax for 1999 was inadvertently
labeled as an “agreed audit deficiency prior to 30 or 60 day
letter”, as opposed to an “audit deficiency per default to 90 day
letter”. Nonetheless, other entries on the form clarify the
factual circumstances, and in any event the issue was adequately
considered and addressed by the Appeals officer in determining
whether the collection action should be sustained (an observation
unaffected by a typographical error in the notice of
determination referring to the 1999 year as 1990).
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Regs. A taxpayer receiving a copy of Form 4340 has been provided
with all the documentation to which he or she is entitled under
section 6203 and section 301.6203-1, Proced. & Admin. Regs.
Roberts v. Commissioner, supra at 370 n.7. This Court likewise
has upheld collection actions where taxpayers were provided with
literal transcripts of account (so-called MFTRAX). See, e.g.,
Frank v. Commissioner, T.C. Memo. 2003-88; Swann v. Commissioner,
T.C. Memo. 2003-70. The notice of determination states
“certified transcripts (Form 4340)” were mailed to petitioner.
Petitioner challenges that statement on brief with the assertion:
“The so-called transcripts were not properly certified and were
not signed by an Assessment Officer as required by law.” The
Court concludes that petitioner’s complaints regarding the
assessments and verification are meritless.
Petitioner has denied receiving the notice and demand for
payment that section 6303(a) establishes should be given within
60 days of the making of an assessment. However, a notice of
balance due constitutes a notice and demand for payment within
the meaning of section 6303(a). Craig v. Commissioner, supra at
262-263. The Forms 4340 indicate that petitioner was sent
notices of balance due for each of the tax years involved.
Finally, at trial petitioner raised an issue regarding
proper notification of the filing of the notice of tax lien. His
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testimony on this matter on cross-examination included the
following:
Q Mr. Call, you say that you never received a
copy of the notice of the Federal Tax lien filed?[4]
A No, sir. I got one when I found the notice
from Credit Watch in my e-mail actually. I went to the
County Recorder and got a copy of the notice of tax
lien that was filed, or actually there was two of them.
There was one for each year, but I got my
copies of the notices of a tax lien from the County
Recorder’s order.
Q And you still managed to get that in time to
file a request for a CDP hearing?
A Yes, sir, apparently I did.
Q Do you have a date of notice from this Credit
Watch Service or any sort of a document that indicates
when you received it originally?
A I have the notices that I picked up from the
County Recorder, and I think they have a stamp on them.
I am not absolutely certain, but I think they stamped
it or date stamped it.
He later added:
I am assuming that the Credit Watch notified me, I
guess, within a day or two of the time that the notice
of tax lien was filed at the County Recorder.
And I was probably at the Recorder’s office the
next day possibly, and possibly the same day. I don’t
remember. But I didn’t dillydally. I went up there
and got that, knowing that my time was limited to file.
4
The Court notes that sec. 6320(a)(1) by its terms requires
only that a taxpayer be given notification that a tax lien has
been filed, not that a copy of the notice of tax lien so filed be
furnished to the taxpayer.
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On reply brief, petitioner expresses his position on this
issue as follows:
Two Notices of Federal Tax Lien were filed with
the Clark County Recorder in March of 2003, for tax
years 1998 and 1999. Petitioner was not notified of
these filings within five days as required by law, and
Internal Revenue Regulations. Respondent claimed
during the inquisition in Tax Court that notification
was sent to Petitioner. According to normal procedures
such notices are sent Certified Mail and the signed
delivery receipt is retained by the sender. To date,
no such evidence of delivery has been produced by
Respondent. Petitioner was made aware of the filing of
the notices by an on-line credit watch agency and filed
a request for Collection Due Process Hearing on
April 16, 2003. Petitioner did not obtain copies of
the Notices of Federal Tax Lien until October 30, 2004
when Petitioner went to the Clark County Recorder’s
office in person and requested them. * * *
Petitioner attached to his reply brief copies of the notices of
tax lien, prepared and signed by the IRS on March 5, 2003, and a
copy of his order receipt for copies of these notices from the
Clark County Recorder, dated October 30, 2003.
The Forms 4340 show March 7, 2003, as the date of the
Federal tax liens. The notice of determination similarly
references March 7, 2003, as the “Date of CDP Notice” and
March 26, 2003, as the “Date Form 12153 Received”. As previously
noted, petitioner’s Form 12153 was submitted on April 16, 2003,
with a cover letter indicating that he had sent an earlier March
26, 2003, letter pertaining to respondent’s collection
activities, to which he had received no response.
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Hence, the combination of petitioner’s testimony and the
various documentary submissions leaves several facts unexplained.
For instance, if petitioner did not receive the notice of lien
filing and attached copy of Form 12153 sent by the IRS, when and
how did he learn about and obtain the Form 12153. The record
likewise remains vague on the timing and content of the alleged
e-mail notification from the credit watch service. It is also
unusual from a timing perspective that petitioner’s request to
the county recorder’s office for copies of the lien notices
occurred after the administrative proceedings in this case were
concluded, after the notice of determination issued, and less
than a week before he mailed his petition to this Court. Suffice
it to say that the claims of nonreceipt of proper notice from the
IRS are less than thoroughly convincing.
Regardless of the veracity of these claims, however, it is
clear that petitioner was aware of the lien filing within a
period to communicate in a timely manner so as to preserve his
rights to an Appeals hearing and subsequent judicial review. In
similar circumstances, this Court has ruled: “Because the
hearing had been timely requested within the prescribed 30-day
period, petitioner’s claims that respondent did not send Letter
3172 to petitioner’s last known address and that petitioner never
received it are beside the point.” Stein v. Commissioner, T.C.
Memo. 2004-124. In that case, the Court concluded that any error
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was harmless and did not give rise to an abuse of discretion in
sustaining the lien, and we see no reason to depart from such an
analysis in the instant scenario.
Thus, with respect to those issues enumerated in section
6330(c)(2)(A) and subject to review in collection proceedings for
abuse of discretion, petitioner has not raised any spousal
defenses, valid challenges to the appropriateness of the
collection action, or collection alternatives. As this Court has
noted in earlier cases, Rule 331(b)(4) states that a petition for
review of a collection action shall contain clear and concise
assignments of each and every error alleged to have been
committed in the notice of determination and that any issue not
raised in the assignments of error shall be deemed conceded. See
Lunsford v. Commissioner, 117 T.C. at 185-186; Goza v.
Commissioner, 114 T.C. 176, 183 (2000). For completeness, we
have addressed various points advanced by petitioner during the
administrative process and this litigation, but the items listed
in section 6330(c)(2)(A) were not pursued in any proceedings.
Accordingly, the Court concludes that respondent’s determination
to proceed with collection of petitioner’s tax liabilities was
not an abuse of discretion.
II. Section 6673 Penalty
Section 6673(a)(1) authorizes the Court to require the
taxpayer to pay a penalty not in excess of $25,000 when it
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appears to the Court that, inter alia, proceedings have been
instituted or maintained by the taxpayer primarily for delay or
that the taxpayer’s position in such proceeding is frivolous or
groundless. In Pierson v. Commissioner, 115 T.C. 576, 581
(2000), we warned that taxpayers abusing the protections afforded
by sections 6320 and 6330 through the bringing of dilatory or
frivolous lien or levy actions will face sanctions under section
6673. We have since repeatedly disposed of cases premised on
arguments akin to those raised herein summarily and with
imposition of the section 6673 penalty. See, e.g., Craig v.
Commissioner, 119 T.C. at 264-265 (and cases cited thereat).
With respect to the instant matter, we are convinced that
petitioner instituted this proceeding primarily for delay.
Throughout the administrative and trial process, petitioner
advanced contentions and demands previously and consistently
rejected by this and other courts. He submitted communications
quoting, citing, using out of context, and otherwise misapplying
portions of the Internal Revenue Code, regulations, Supreme Court
decisions, and other authorities. While his procedural stance
concerning recording was correct, he ignored the Court’s explicit
warning that any further proceedings would be justified only in
the face of relevant and nonfrivolous issues.
Moreover, petitioner was expressly alerted to the potential
use of sanctions in his case. Yet he appeared at the trial
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session in Las Vegas without any legitimate evidence or argument
in support of his position. He instead continued to espouse
positions that had been explicitly addressed and rejected in this
Court’s order of November 10, 2004, or in other cases previously
decided by the Court. The Court sua sponte concludes that a
penalty of $5,000 should be awarded to the United States in this
case. To reflect the foregoing,
An appropriate decision
will be entered.