T.C. Summary Opinion 2007-25
UNITED STATES TAX COURT
CHERYL WARD, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 16334-05S. Filed February 21, 2007.
Cheryl Ward, pro se.
L. Katrine Shelton, for respondent.
DEAN, Special Trial Judge: This case was heard pursuant to
the provisions of section 7463. Unless otherwise indicated all
section references are to the Internal Revenue Code in effect for
the years in issue, and all Rule references are to the Tax Court
Rules of Practice and Procedure. The decision to be entered is
not reviewable by any other court, and this opinion should not be
cited as authority.
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This case is before the Court on respondent’s motion for
summary judgment under Rule 121. This proceeding arises from a
petition for judicial review filed in response to a Notice of
Determination Concerning Collection Action(s) Under Section 6320
sent to petitioner.
Background
At the time the petition in this case was filed, petitioner
resided in Oakland, California.
Petitioner filed for 1999 and 2000, Forms 1040, U.S.
Individual Income Tax Return, on February 21, 2001, and on May
14, 2001, respectively. Petitioner failed to pay all of the
taxes reported on the returns. The unpaid taxes, related
penalties, and interest were accordingly assessed. Respondent
did not issue to petitioner a statutory notice of deficiency for
1999 or 2000.
Respondent subsequently filed a Notice of Federal Tax Lien
(tax lien) with respect to petitioner’s tax liabilities for 1999
and 2000. On July 20, 2004, respondent issued to petitioner a
Notice of Federal Tax Lien Filing and Your Right to a Hearing
Under IRC 6320. Petitioner timely submitted a Form 12153,
Request for a Collection Due Process Hearing.
On the Form 12153, petitioner stated in the explanation that
she did not agree with the tax lien because “I am applying for an
offer in compromise. I am disabled.” Petitioner subsequently
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filed a Form 656, Offer in Compromise (OIC), based on promotion
of effective tax administration, for 1999, 2000, 2001, 2002, and
2003. Petitioner offered to settle her outstanding tax
liabilities, totaling approximately $40,000, for $1,000.
Petitioner’s case was assigned to Appeals Officer Celia
Cleveland (AO Cleveland). AO Cleveland conducted the collection
due process hearing with petitioner and her representative via
numerous telephone conversations and written correspondence.
During the hearing, petitioner did not challenge the existence or
amount of the underlying tax liability for 1999 or 2000.
Based on the documentation submitted by petitioner, AO
Cleveland determined that petitioner’s OIC did not qualify for
consideration as an offer based on promotion of effective tax
administration. Petitioner did not offer any other collection
alternatives other than the OIC. AO Cleveland reviewed
petitioner’s administrative file and transcripts for the years in
issue, and she verified that all applicable laws and
administrative procedures had been met.
On July 22, 2005, the Appeals Office issued to petitioner a
Notice of Determination Concerning Collection Action(s) Under
Section 6320 for 1999 and 2000 (notice of determination),
determining that respondent’s filing of the tax lien was proper
and indicating that petitioner’s OIC was rejected. The
attachment to the notice of determination notes that petitioner
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failed to submit documentation to establish that she is
permanently and totally disabled.
On August 31, 2005, petitioner filed with the Court a
petition for lien or levy action. The only error assigned in the
petition pertains to petitioner’s challenge of her underlying tax
liabilities.
Respondent asks for summary judgment with respect to the
notice of determination in that petitioner’s failure to challenge
the existence or amount of the underlying tax liabilities for
1999 and 2000 during the collection due process hearing precludes
her from now challenging the underlying tax liabilities.
Petitioner was ordered to file a response to respondent’s motion,
but no response has been received by the Court.
Discussion
Rule 121(a) allows a party to move “for a summary
adjudication in the moving party’s favor upon all or any part of
the legal issues in controversy.” Rule 121(b) directs that a
decision on such a motion shall be rendered “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.”
The moving party bears the burden of demonstrating that no
genuine issue of material fact exists and that he or she is
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entitled to judgment as a matter of law. Sundstrand Corp. v.
Commissioner, 98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th
Cir. 1994). Facts are viewed in the light most favorable to the
nonmoving party. Id. However, where a motion for summary
judgment has been properly made and supported by the moving
party, the opposing party may not rest upon mere allegations or
denials contained in that party’s pleadings but must by
affidavits or otherwise set forth specific facts showing that
there is a genuine issue for trial. Rule 121(d). The Court has
considered the pleadings and other materials in the record and
concludes that there is no genuine justiciable issue of material
fact regarding the collection matters in this case.
Section 6321 imposes a lien in favor of the United States
upon all property and rights to property of a person where there
exists a failure to pay any tax liability after demand for
payment. The lien generally arises when the assessment is made.
Sec. 6322.
Section 6320 entitles a person to notice of her right to
request a hearing after a notice of lien is filed by the
Commissioner in furtherance of the collection from the person of
unpaid Federal taxes. If one is requested, the administrative
hearing is before the Appeals Office of the Internal Revenue
Service. Sec. 6320(b)(1). The person requesting the hearing may
raise any relevant issue with regard to the Commissioner’s
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intended collection activities, including spousal defenses,
challenges to the appropriateness of the Commissioner’s intended
collection action, and alternative means of collection. Secs.
6320(b), (c); 6330(c); see Sego v. Commissioner, 114 T.C. 604,
609 (2000); Goza v. Commissioner, 114 T.C. 176, 180 (2000).
Section 6330(c)(2)(B) provides that the existence or the
amount of the underlying tax liability can be contested at an
Appeals Office hearing if the person did not receive a notice of
deficiency or did not otherwise have an earlier opportunity to
dispute such tax liability. Sego v. Commissioner, supra; Goza v.
Commissioner, supra at 180-181.
In making a determination, the Appeals officer is required
to take into consideration issues properly raised, the
verification that the requirements of applicable law and
administrative procedures have been met, and whether any proposed
collection action balances the need for efficient collection of
taxes with the legitimate concern of the person that any
collection action is no more intrusive than necessary. Sec.
6330(c)(3). Within 30 days after the Appeals Office issues a
notice of determination, the person may appeal the determination
to the Tax Court, if the Court has jurisdiction over the
underlying tax liability. Sec. 6330(d)(1)(A). The Court has
jurisdiction in this case.
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The disagreements expressed by petitioner for 1999 and 2000
in her petition relate to the deductibility of certain claimed
expenses on Schedules A and C and the applicability of penalties.
Because petitioner self-assessed her taxes for all years in
issue, no statutory notice of deficiency was issued. See sec.
6201(a)(1). Petitioner therefore could have challenged the
existence or amount of the underlying tax liabilities during the
Appeals Office hearing. Petitioner, however, did not do so, and
she is accordingly precluded from challenging the underlying tax
liabilities in this proceeding. Sec. 301.6320-1(f)(2), Q&A-F5,
Proced. & Admin. Regs.; see Miller v. Commissioner, 115 T.C. 582,
589 n.2 (2000), affd. 21 Fed. Appx. 160 (4th Cir. 2001); see also
sec. 301.6330-1(f)(2), Q&A-F5, Proced. & Admin. Regs.; Magana v.
Commissioner, 118 T.C. 488, 493-494 (2002).
In her petition, petitioner failed to raise a spousal
defense, make a valid challenge to the appropriateness of
respondent’s intended collection action, or offer alternate means
of collection. A petition for review of a collection action must
clearly specify the errors alleged to have been committed in the
notice of determination. Rule 331(b)(4). Any issues not raised
in the assignments of error are deemed to be conceded by
petitioner. Id.; see Goza v. Commissioner, supra at 183; see
also Lunsford v. Commissioner, 117 T.C. 183, 185-186 (2001).
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In the absence of a valid issue for review, the Court
concludes that respondent is entitled to judgment as a matter of
law sustaining the notice of determination dated July 22, 2005.
The Court will grant respondent’s motion for summary judgment.
Reviewed and adopted as the report of the Small Tax Case
Division.
To reflect the foregoing,
An appropriate order and
decision will be entered.