T.C. Summary Opinion 2007-71
UNITED STATES TAX COURT
JASON HARRINGTON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 16382-05S. Filed May 7, 2007.
Jason Harrington, pro se.
Beth A. Nunnink, for respondent.
WELLS, Judge: This case was heard pursuant to the
provisions of section 7463 of the Internal Revenue Code in effect
when the petition was filed.1 Pursuant to section 7463(b), the
decision to be entered is not reviewable by any other court, and
1
Unless otherwise indicated, all Rule references are to the
Tax Court Rules of Practice and Procedure, and all subsequent
section references are to the Internal Revenue Code, as amended.
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this opinion shall not be treated as precedent for any other
case.
This matter is before the Court on respondent’s motion for
summary judgment pursuant to Rule 121. The issue we must decide
is whether respondent’s Appeals Office abused its discretion in
determining to proceed with collection of petitioner’s tax
liabilities for taxable years 1998, 2000, 2001, and 2002 by lien.
Background
At the time of filing the petition, petitioner resided in
Clarksdale, Mississippi.
Petitioner filed an income tax return for taxable year 1998,
but failed to pay all of the liability reported on the return.
Petitioner failed to file income tax returns for 2000, 2001, and
2002. On October 27, 2003, respondent sent petitioner two
letters requesting that petitioner file income tax returns for
2000 and 2001. On November 26, 2003, respondent received from
petitioner returns for taxable years 2000 and 2001, which
reported zeros on every line of the return. Attached to the
returns for 2000 and 2001 were letters containing frivolous
arguments.
On February 27, 2004, respondent sent petitioner notices of
deficiency for 2000 and 2001. On July 19, 2004, respondent
assessed the tax liabilities, along with additions to tax and
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interest. Respondent sent petitioner a Notice of Federal Tax
Lien Filing and Your Right to a Hearing Under I.R.C. 6320 (CDP
Notice), dated January 7, 2005, advising petitioner that a notice
of Federal tax lien had been filed with respect to his unpaid
liabilities for taxable years 1998, 2000, 2001, and 2002, and
that petitioner could receive a hearing with respondent’s Office
of Appeals.
On February 16, 2005, petitioner timely submitted a Form
12153, Request for a Collection Due Process Hearing. On Form
12153, petitioner states only “I DONOT [sic] UNDERSTAND!”
Petitioner did not suggest any collection alternatives.
Petitioner was not current in filing his income tax returns,
having failed to file returns for 1999, 2003, and 2004.
On June 7, 2005, Settlement Officer Suzanne Magee (Mrs.
Magee) set up a telephonic conference for June 28, 2005,
requested returns for the 1999, 2003, and 2004 tax years,
requested the collection information statement, requested proof
of payment of estimated taxes for 1999, 2003, and 2004, and
provided information on what could be discussed during the
collection due process hearing. Mrs. Magee requested that such
information be provided by July 21, 2005.
By letter dated June 17, 2005 (June 17 letter), petitioner
requested a conference at a later date. The June 17 letter also
requested a face-to-face hearing and contained frivolous
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arguments. Finally, the letter threatened that petitioner would
file a claim for damages of $200,000 against the Settlement
Officer personally.
By letter dated June 21, 2005, Mrs. Magee responded to
the June 17 letter, rescheduling the telephonic conference for
July 12, 2005, at 3 p.m. Mrs. Magee also informed petitioner
that the arguments in the June 17 letter were ones that courts
had held to be frivolous and would not be considered by
respondent’s Appeals Office. Mrs. Magee directed petitioner to
“The Truth About Frivolous Tax Arguments” on the IRS Web site.
In her letter, Mrs. Magee also explained that respondent’s
Appeals Office does not provide a face-to-face hearing if the
only items a taxpayer wishes to discuss are frivolous arguments.
Petitioner replied by letter, again requesting a face-to-
face hearing but not specifying any nonfrivolous issues to
discuss. Petitioner stated in the letter that he wished to
discuss the underlying liabilities.
On July 12, 2005, Mrs. Magee attempted a telephonic
conference with petitioner. Petitioner indicated that he was
speaking via a cell phone and said very little. The call was cut
off prematurely. When Mrs. Magee attempted to call petitioner
immediately thereafter, petitioner did not answer. Mrs. Magee
called three more times on July 12, 2005, and received no answer.
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Mrs. Magee could not leave a message because petitioner did not
have functioning voicemail. Additionally, petitioner, who had
Mrs. Magee’s telephone number, did not contact her after their
telephone call was cut off.
On August 3, 2005, respondent sent petitioner a Notice of
Determination Concerning Collection Actions under Section 6320
and/or 6330. On September 2, 2005, petitioner timely filed a
petition with this Court. In the petition, petitioner claims
that he did not receive a collection due process hearing.
Discussion
Summary judgment is intended to expedite litigation and
avoid unnecessary and expensive trials and may be granted where
there is no genuine issue of material fact and a decision may be
rendered as a matter of law. Rule 121(a) and (b); Fla. Peach
Corp. v. Commissioner, 90 T.C. 678, 681 (1988). The moving party
bears the burden of proving that there is no genuine issue of
material fact, and factual inferences are viewed in a light most
favorable to the nonmoving party. Craig v. Commissioner, 119
T.C. 252, 260 (2002); Dahlstrom v. Commissioner, 85 T.C. 812, 821
(1985). The party opposing summary judgment must set forth
specific facts that show that a genuine question of material fact
exists and may not rely merely on allegations or denials in the
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pleadings. Grant Creek Water Works, Ltd. v. Commissioner, 91
T.C. 322, 325 (1988); Casanova Co. v. Commissioner, 87 T.C. 214,
217 (1986).
Section 6320(a)(1) requires the Secretary to give persons
liable to pay taxes written notice of the filing of a tax lien.
Section 6320(a)(3)(B) and (b)(1) provides that the notice shall
inform such persons of the right to request a hearing in
respondent’s Appeals Office.
Section 6320(c) provides that an Appeals Office hearing
generally shall be conducted consistently with the procedures set
forth in section 6330(c), (d), and (e). The Appeals officer must
verify at the hearing that the applicable laws and administrative
procedures have been followed. Sec. 6330(c)(1). At the hearing,
the person against whom the lien is filed may raise any relevant
issues relating to the unpaid tax or the lien, including
appropriate spousal defenses, challenges to the appropriateness
of collection actions, and collection alternatives. Sec.
6330(c)(2)(A). The person may challenge the existence or amount
of the underlying tax, however, only if he 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).
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Where the validity of the underlying tax liability is
properly in issue, the Court will review the matter de novo.
Where the validity of the underlying tax is not properly in
issue, however, the Court will review the Commissioner’s
administrative determination for abuse of discretion. Sego v.
Commissioner, 114 T.C. 604, 610 (2000); Goza v. Commissioner,
114 T.C. 176, 181-182 (2000).
Petitioner has not alleged that he did not receive the
notices of deficiency. Petitioner had an opportunity to
challenge the correctness of his tax liabilities for 2000 and
2001 by petitioning this Court from the notice of deficiency but
failed to do so. Therefore, petitioner’s underlying tax
liabilities were not properly in issue. Accordingly, we review
respondent’s determination for an abuse of discretion.
Petitioner did not receive notices of deficiency for 1998
and 2002. Petitioner could have challenged the underlying
liabilities for those years. However, section 6330(c)(2) allows
the taxpayer to raise only “any relevant issue relating to the
unpaid tax or the proposed levy”, not “any” issue. Frivolous
challenges to the underlying liability are not “relevant issues”.
Hathaway v. Commissioner, T.C. Memo. 2004-15.
In the instant case, the record indicates that the only
issues petitioner raised throughout the section 6320
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administrative process and in his petition to this Court were
frivolous tax protester type arguments. We do not address
petitioner’s frivolous arguments with somber reasoning and
copious citations of precedent, as to do so might suggest that
these arguments possess some degree of colorable merit. See
Crain v. Commissioner, 737 F.2d 1417, 1417 (5th Cir. 1984).
To the extent petitioner complains of not receiving a face-
to-face hearing, this Court has held that it is neither necessary
nor productive to remand cases to an Appeals Office for face-to-
face hearings when a taxpayer raises only frivolous arguments.
Lunsford v. Commissioner, 117 T.C. 183, 189 (2001).
Petitioner was not current in filing his income tax returns,
having failed to file for taxable years 1999, 2003, and 2004.
Petitioner was not eligible for, nor did he submit, any
collection alternatives.
We conclude that, although the telephonic conference
terminated prematurely, petitioner did receive a hearing as
required by sections 6320(b) and 6330(c)(3).2 Mrs. Magee
verified that all applicable laws and administrative procedures
had been met, that she had not had any prior involvement with
respect to petitioner’s tax liability, and that the proposed
collection activity was no more intrusive than necessary.
2
Although petitioner’s request for a hearing was pursuant to
sec. 6320, sec. 6320(c) provides that sec. 6330(c) applies.
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Accordingly, we hold that no genuine issue of material fact
exists requiring trial and that respondent is entitled to summary
judgment. Respondent’s determination to proceed with the
proposed lien to collect petitioner’s tax liabilities for 1998,
2000, 2001, and 2002 was not an abuse of discretion.
Section 6673(a)(1) authorizes the Court to impose a penalty
not in excess of $25,000 when it appears to the Court that, inter
alia, proceedings have been instituted or maintained by the
taxpayer primarily for delay or that the position of the taxpayer
in such proceeding is frivolous or groundless. In Pierson v.
Commissioner, 115 T.C. 576, 581 (2000), we issued a warning
concerning the imposition of a penalty under section 6673(a)(1)
on those taxpayers abusing the protections afforded by sections
6320 and 6330 through the bringing of dilatory or frivolous lien
or levy actions. The Court has 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
therein).
Respondent has moved for the imposition of a section 6673
penalty in the instant case. Petitioner has raised only
frivolous arguments, both before and after being warned about
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the possibility of a section 6673 penalty and being directed to
“The Truth About Frivolous Tax Arguments.” Accordingly, we shall
impose a penalty of $1,000.
To reflect the foregoing,
An appropriate order and
decision will be entered.