T.C. Summary Opinion 2007-128
UNITED STATES TAX COURT
ZANE D. AND DEBBIE L. WORMAN, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 4500-06S. Filed July 26, 2007.
Zane D. and Debbie L. Worman, pro sese.
Michael W. Lloyd, for respondent.
ARMEN, Special Trial 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
1
Unless otherwise indicated, all subsequent section
references are to the Internal Revenue Code, as amended, and all
Rule references are to the Tax Court Rules of Practice and
Procedure.
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other court, and this opinion shall not be treated as precedent
for any other case.
This matter is before the Court on respondent’s Motion To
Dismiss For Lack Of Jurisdiction, filed June 1, 2007, and
supplemented June 13, 2007. In his motion, respondent moves to
dismiss this case for lack of jurisdiction principally on the
ground that “no Notice of Determination Concerning Collection
Actions Under Section 6320 and/or Section 6330, as authorized by
I.R.C. § 6320 and required by I.R.C. § 6330(d) to form the basis
for a petition to this Court, has been sent to petitioners with
respect to taxable years 1995, 1998, 2002 and 2003”. Respondent
also moves to dismiss on the ground that “as to the IRS filed
Notice of Federal Tax Lien which is attached to the petition,
said lien was released on February 14, 2007, and the liability
fully paid”. For reasons discussed hereinafter, we shall grant
respondent’s motion, as supplemented, in that we shall dismiss
this case for lack of jurisdiction on the ground that no notice
of determination was sent to petitioners by respondent’s Office
of Appeals for any of the taxable years in issue.
Background
At the time that the petition was filed, Zane D. Worman and
Debbie L. Worman (petitioners) resided in Gillette, Wyoming.
For 1995, 1998, 2002, and 2003, the taxable years in issue,
petitioners filed Federal income tax returns. Although
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petitioners reported tax on those returns, petitioners did not
enclose full payment with any of their returns.
Upon receipt of petitioners’ returns, respondent assessed
the tax reported thereon, as well as applicable penalties and
statutory interest, and sent petitioners so-called statutory
notices of balance due, i.e., notice and demand for payment. See
sec. 6303(a). Petitioners did not immediately pay the
outstanding liabilities.2
By letter dated February 16, 2006, respondent sent to
petitioners a Notice of Federal Tax Lien Filing and Your Right to
a Hearing Under IRC 6320 (lien notice). The lien notice
referenced a notice of Federal tax lien filed by respondent with
the Campbell County Clerk in Gillette, Wyoming, regarding
petitioners’ outstanding liabilities for 1995, 1998, 2002, and
2003.
The lien notice included the following statements:
You have a right to request a hearing with us to appeal
this collection action and to discuss your payment
method options. To explain the different collection
appeal procedures available to you, we’ve enclosed
Publication 1660, Collection Appeal Rights.
If you want to request a hearing, please complete the
enclosed form 12153, Request for a Collection Due
Process Hearing and mail it to:
2
Subsequently, for 1995, respondent determined a modest
deficiency in, and addition for late filing to, petitioners’
income tax. Upon default of the notice of deficiency, respondent
assessed the determined liability.
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Internal Revenue Service
DP S-661A
P.O. Box 1064
Bensalem, PA 19020
You must request your hearing by 03/20/2006.
We’ll issue a Certificate of Release of the Federal Tax
Lien within 30 days after you pay the full amount owed.
Petitioners received the lien notice. However, they did not
file with respondent a Form 12153, Request for a Collection Due
Process Hearing, or a written equivalent. Rather, petitioners
filed with this Court on March 3, 2006, a petition disagreeing
“with the determination contained in the notice issued by the
Internal Revenue Service for the year(s) or period(s) 1995, 1998,
2002, [and] 2003, as set forth in such notice dated 2/16/2006”.3
As an exhibit to the petition, petitioners attached a copy of the
lien notice, as well as a copy of the notice of Federal tax lien
filed with the Campbell County Clerk in Gillette, Wyoming.
By notice dated January 19, 2007, this case was calendared
for trial at the Court’s trial session scheduled for June 22,
2007, in Cheyenne, Wyoming.
On February 26, 2007, respondent filed a Certificate of
Release of Federal Tax Lien with the Campbell County Clerk in
Gillette, Wyoming. The certificate of release recites that
petitioners have satisfied the taxes and all statutory additions
3
The petition arrived at the Court by Priority Mail in an
envelope bearing a U.S. Postal Service postmark dated Feb. 27,
2006.
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for 1995, 1998, 2002, and 2003 and that, as a consequence, “the
lien provided by Code section 6321 * * * has been released.”
On June 1, 2007, respondent filed his Motion To Dismiss For
Lack Of Jurisdiction. By Order dated June 7, 2007, the Court
calendared the motion for hearing at the June 22, 2007 Cheyenne,
Wyoming trial session.4 On June 13, 2007, respondent filed a
Supplement to his motion.
Discussion
The Tax Court is a court of limited jurisdiction. See sec.
7442. Accordingly, we may exercise jurisdiction only to the
extent expressly authorized by statute. Breman v. Commissioner,
66 T.C. 61, 66 (1976). In addition, jurisdiction must be proven
affirmatively, and a party invoking our jurisdiction bears the
burden of proving that we have jurisdiction over the party’s
case. See Fehrs v. Commissioner, 65 T.C. 346, 348 (1975);
Wheeler’s Peachtree Pharmacy, Inc. v. Commissioner, 35 T.C. 177,
180 (1960); Natl. Comm. to Secure Justice, Etc. v. Commissioner,
27 T.C. 837, 839 (1957). In order to meet this burden, the party
must establish affirmatively all facts giving rise to our
jurisdiction. See Wheeler’s Peachtree Pharmacy, Inc. v.
Commissioner, supra at 180; Consol. Co. v. Commissioner, 15
B.T.A. 645, 651 (1929).
4
Telephone conference calls with the parties were
conducted prior to the scheduled hearing.
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The Internal Revenue Service Restructuring and Reform Act of
1998 (RRA 1998), Pub. L. 105-206, 112 Stat. 685, was enacted into
law on July 22, 1998. RRA 1998 section 3401, 112 Stat. 746,
grants this Court jurisdiction to review the Commissioner’s
determination as to the propriety of filing a notice of Federal
tax lien under section 6320 or a proposed levy on property under
section 6330.
In a collection review action, this Court’s jurisdiction
under sections 6320 and 6330 depends, in part, on the issuance of
a notice of determination by the Commissioner Office of Appeals
after the taxpayer has requested an administrative hearing
following the issuance by the Commissioner’s collection division
of either a final notice of intent to levy, see sec. 6330(a), or
a notice of filing of Federal tax lien, see sec. 6320(a). See
Sarrell v. Commissioner, 117 T.C. 122, 125 (2001); Moorhous v.
Commissioner, 116 T.C. 263, 269 (2001); Offiler v. Commissioner,
114 T.C. 492, 498 (2000); see also Rule 330(b).
Petitioners received the lien notice in February 2006, but
they never requested an administrative hearing by filing with
respondent a Form 12153 or an equivalent written request.
Instead, they responded to the lien notice by filing a petition
with this Court. Thus, because petitioners never requested an
administrative hearing as mandated by section 6320, respondent’s
Office of Appeals had no occasion to, and therefore did not,
issue a notice of determination. In short, the petition in this
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case was filed in response to the lien notice and not in response
to a notice of determination as mandated by statute. Therefore,
we may not, as we lack jurisdiction, address the propriety of the
filing of the lien in this case.
The foregoing is dispositive of the matter before us.
However, even if petitioners had filed with the Court a petition
appealing from a notice of determination issued by respondent’s
Office of Appeals following a timely request for an
administrative hearing, we would still be obliged to grant
respondent’s motion, as supplemented, and dismiss this case.
Thus, in Greene-Thapedi v. Commissioner, 126 T.C. 1 (2006), the
Court held: (1) The taxpayer’s challenges to the Commissioner’s
collection action (a proposed levy) were moot because there was
no unpaid tax liability upon which a levy could be based and the
Commissioner would not take any further collection action; (2)
this Court lacks jurisdiction in a lien or levy case (collection
review case) to determine an overpayment or to order a refund or
credit of taxes; and (3) the taxpayer’s case should be dismissed
as moot.
In the present case, petitioners’ unpaid assessed liability
is zero for each of the 4 years in issue. Although a few cents
of accrued interest may remain for 1998 and 2003, respondent’s
counsel has represented that respondent has, as a matter of
policy, written off such amounts as de minimis and does not seek
to collect them. This representation is confirmed by the fact
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that in February 2007, respondent filed with the Campbell County
Clerk in Gillette, Wyoming, a Certificate of Release of Federal
Tax Lien reciting that petitioners had satisfied the taxes and
“all statutory additions” for 1995, 1998, 2002, and 2003.
Finally, we note that if petitioners think that they have
overpaid their liability for any of the years in issue, then
petitioners may have a judicial remedy in the form of a civil
action for refund in the appropriate U.S. District Court or the
U.S. Court of Federal Claims. See sec. 7422; see also 28 U.S.C.
secs. 1346(a)(1), 1402(a).5 Because such actions are governed by
strict procedural rules, petitioners may care to consult a
competent tax professional familiar with such matters.
5
Civil actions for refund under sec. 7422 are not
cognizable in the Tax Court. Indeed, our jurisdiction to even
determine overpayments is narrowly circumscribed. E.g., sec.
6512(b)(1).
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To give effect to the foregoing,
An order granting
respondent’s motion, as
supplemented, will be entered
dismissing this case for lack
of jurisdiction on the ground
that no notice of determination was
sent to petitioners by respondent’s
Office of Appeals for any of
the taxable years in issue.