T.C. Summary Opinion 2008-39
UNITED STATES TAX COURT
SUZANNE V. THOMPSON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 20009-06S. Filed April 16, 2008.
Michael Neil Gendelman, for petitioner.
Daniel J. Parent, for respondent.
DEAN, 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. Pursuant to section 7463(b),
the decision to be entered is not reviewable by any other court,
and this opinion shall not be treated as precedent for any other
case. Unless otherwise indicated, subsequent section references
- 2 -
are to the Internal Revenue Code as amended, and all Rule
references are to the Tax Court Rules of Practice and Procedure.
This case arises from a request for relief from joint and
several liability under section 6015(f) with respect to
petitioner’s unpaid joint tax liabilities for 1995 through 1997.
The issues for decision are whether: (1) The “section 6330
notice” issued to petitioner is valid; (2) petitioner’s request
for relief from joint and several liability was timely; and (3)
petitioner is entitled to relief from joint and several liability
under section 6015(f) for each year.
Background
Some of the facts have been stipulated and are so found.
The stipulation of facts and the exhibits received into evidence
are incorporated herein by reference. At the time the petition
was filed, petitioner resided in California.
Petitioner married Mr. Thompson in 1979. During the first
part of the marriage, petitioner did not work outside of the
home. Petitioner started working as an administrative assistant
for her current employer, IA Interior Architects, in November
1994.1 Mr. Thompson was employed as a certified public
accountant, specializing in tax controversies, audits, and tax
returns; he opened his own firm around 1989.
1
The record does not contain any information as to
petitioner’s education level.
- 3 -
Petitioner and Mr. Thompson filed a joint Form 1040, U.S.
Individual Income Tax Return, for each of the years at issue.
The Federal income tax returns were filed without remittance of
the taxes due. The assessed taxes, as of the date of filing, are
summarized as follows:
Year Tax shown on return
1995 $14,977
1996 9,733
1997 9,294
No notices of deficiency were issued.
Petitioner and Mr. Thompson separated in 1997, and
petitioner was referred by the Battered Women of Contra Costa
County to an attorney, Mr. Moats. Mr. Moats represented
petitioner in her divorce and bankruptcy proceedings.
Petitioner filed for bankruptcy in March 1999. Petitioner’s
unpaid tax liabilities for 1988 through 1994 were discharged on
June 16, 1999; the unpaid tax liabilities for 1995 through 1997
were not discharged.
Mr. Thompson filed for divorce in November 1998, and it
became final on December 29, 1999. The divorce decree provides
that petitioner and Mr. Thompson were to remain jointly liable
for the payment of the Federal income tax liabilities for 1995
through 1997. Petitioner was to negotiate her tax liabilities
“to the lowest total amount and monthly payments possible” by
submitting an offer-in-compromise (OIC) to the Internal Revenue
- 4 -
Service (IRS). Thereafter, Mr. Thompson agreed to pay petitioner
50 percent of each monthly payment. The divorce decree reserved
Mr. Thompson’s rights to discharge his tax liabilities for 1986
through 1997 in bankruptcy or to submit an OIC. Mr. Thompson
filed for bankruptcy, and his unpaid tax liabilities for 1988
through 1997 were discharged on June 4, 2004.
On August 30, 2000, the IRS issued a Letter 3172, Notice of
Federal Tax Lien Filing and Your Right to a Hearing under IRC
6320, to petitioner and Mr. Thompson for 1996 and 1997. The
notice, however, was addressed to Mr. Thompson’s place of
business.
On October 13, 2003, the IRS issued to petitioner seven
Notices CP 504, “Urgent!! We intend to levy on certain assets.
Please respond NOW”, stating that the IRS intended to levy upon
petitioner’s assets for 1988 through 1990, 1993, and 1995 through
1997. Each notice showed a “Current Balance” for the referenced
year even though petitioner’s tax liabilities for 1988 through
1994 had been discharged in bankruptcy. In response, petitioner
contacted the IRS and Mr. Moats to resolve her tax matters.
On October 28, 2003, the IRS issued to petitioner a section
6330 notice; i.e., a Letter 1058, Final Notice of Intent to Levy
And Notice of Your Right to a Hearing. The section 6330 notice
included references to years and tax liabilities that had been
discharged in bankruptcy and is reproduced as follows:
- 5 -
Tax Year Tax Assessed Interest Penalty Total
type
1040 1988 $2,299.81 $602.14 -0- $2,901.95
1040 1989 16,679.32 4,583.03 -0- 21,262.35
1040 1990 12,773.58 3,539.61 -0- 16,313.19
1040 1993 23,541.93 6,471.93 -0- 30,013.86
1040 1995 12,051.08 9,221.13 $2,754.24 24,026.45
1040 1996 497.17 207.65 14.80 719.62
1040 1997 5,204.43 1,613.16 624.08 7,441.67
Total amount due 102,679.09
On September 14, 2004, the IRS issued to petitioner a
Letter 2050, Please Call US About Your Overdue Taxes or Tax
Returns. The notice is reproduced as follows:
Tax Year Tax Assessed Interest Penalty Total
type
SPASMT 1995 $12,051.08 $11,243.10 $2,754.24 $26,048.42
SPASMT 1996 497.17 274.64 14.80 786.61
SPASMT 1997 5,204.43 -0- 624.08 5,828.51
Total amount due 32,663.54
On September 19, 2005, the IRS issued to petitioner a Notice
CP 49, Overpaid Tax Applied to Other Taxes You Owe, informing
petitioner that the IRS applied her $40.51 refund for 2004 to her
account.
Sometime in December 2005, petitioner was referred by the
State Bar of California to her present counsel, who filed
petitioner’s Form 8857, Request for Innocent Spouse Relief (And
Separation of Liability and Equitable Relief). Petitioner’s
prior counsel, Mr. Moats, disappeared and did not return
petitioner’s file until the 2-year limitations period had
expired. The State bar issued an order on July 8, 2005,
declaring Mr. Moats ineligible to practice law. Mr. Moats
- 6 -
tendered his resignation with charges pending on October 20,
2005, effective December 4, 2005.
Petitioner’s request for relief, received by respondent on
March 20, 2006, was denied because it was received more than 2
years after the first collection activity, the section 6330
notice issued October 28, 2003.
Discussion
I. Joint and Several Liability and Section 6015(f) Relief
Section 6013(d)(3) provides that if a joint return is filed,
the tax is computed on the taxpayers’ aggregate income, and
liability for the resulting tax is joint and several. See also
sec. 1.6013-4(b), Income Tax Regs. But the IRS may relieve a
taxpayer from joint and several liability under section 6015(f)
if, taking into account all the facts and circumstances, it is
inequitable to hold the taxpayer liable for any unpaid tax or
deficiency and he does not qualify for relief under section
6015(b) or (c). Except as otherwise provided in section 6015,
petitioner bears the burden of proof with respect to her
entitlement to relief. See Rule 142(a); Alt v. Commissioner, 119
T.C. 306, 311 (2002), affd. 101 Fed. Appx. 34 (6th Cir. 2004).
II. 2-Year Limitations Period
Section 1.6015-5(b)(1), Income Tax Regs., provides that an
electing spouse must apply for relief no later than 2 years from
the date of the IRS’s first collection activity against the
- 7 -
electing spouse after July 22, 1998. The term “collection
activity” is defined to include a section 6330 notice, which is
also defined as the notice the IRS sends to taxpayers informing
them of the IRS’s intent to levy and their right to request a
hearing. See sec. 1.6015-5(b)(2)(i) and (ii), Income Tax Regs.
Respondent argues that the section 6330 notice is valid
despite including references to years and tax liabilities that
had been discharged in bankruptcy. Respondent alleges:
“Although there may have been some confusion over whether
petitioner was liable” for 1988 through 1990 and 1993, “there was
no confusion as to whether petitioner was liable” for 1995
through 1997. According to respondent, petitioner knew that she
had tax liabilities for 1995 through 1997, and she knew how much
she owed for each year. Respondent further asserts that
petitioner could have filed for relief at any time during the 2-
year period, and the IRS’s representations had “no bearing on
petitioner’s ability to file a timely request”. Finally,
respondent argues that because petitioner’s request for relief
was untimely, he did not abuse his discretion by denying the
requested relief.
III. Validity of the Section 6330 Notice
As a general rule, notices containing technical defects are
valid unless the taxpayer has been prejudiced or misled by the
error and he has not been afforded a meaningful opportunity to
- 8 -
litigate the claim. See Estate of Yaeger v. Commissioner, 889
F.2d 29, 35 (2d Cir. 1989) (deficiency notice referenced wrong
year but attachments referenced correct year), affg. T.C. Memo.
1988-264; Planned Invs., Inc. v. United States, 881 F.2d 340, 343
(6th Cir. 1989) (notice of assessment referenced wrong period but
taxpayer knew correct period from contacts with IRS); see also
Sanderling, Inc. v. Commissioner, 571 F.2d 174, 176 (3d Cir.
1978) (deficiency notice is valid if a taxpayer has not been
misled as to the year or amount involved; notice was valid since
it referenced correct year and transaction despite references to
wrong years), affg. 66 T.C. 743, 749 (1976); Petaluma FX
Partners, LLC v. Commissioner, T.C. Memo. 2007-254 (a notice
containing errors as to the taxable year may still be valid where
the taxpayer reasonably could not be misled as to the taxable
period involved); United States v. Rabinovici, 99 AFTR 2d 2007-
1812, 2007-1 USTC par. 50,467 (E.D.N.Y. 2007) (section 6330
notice referenced wrong period for an assessed trust fund
recovery penalty). Notices “‘must meet the general ‘fairness’
requirement of due process.’” Estate of Yaeger v. Commissioner,
supra at 35 (quoting Planned Invs., Inc. v. United States, supra
at 344).
The Court has stated that in determining whether a notice is
valid despite an error, it looks at the notice, any attachments,
and the circumstances surrounding the notice’s issuance and
- 9 -
receipt to determine whether the taxpayer could have been
reasonably confused or misled. See Upchurch v. Commissioner,
T.C. Memo. 2007-181 (deficiency notice referencing wrong year was
valid since attachments referenced correct year and transactions;
taxpayer referenced correct year in his written protest and
participated in 3 years of review with the IRS before its
issuance).
If there is a requisite showing of prejudice or detriment to
the taxpayer because of the IRS’s actions, the IRS may be
precluded from claiming the benefit of a limitations period. See
Stallard v. United States, 12 F.3d 489, 491-492, 496 (5th Cir.
1994) (“Bureaucratic ineptitude and indifference” combined with
the IRS’s admissions that the Form 23C contained the wrong tax
period made the summary record invalid); see also United States
v. Rabinovici, supra at 2007-1819, 2007-1 USTC par. 50,467, at
88,290 (if a taxpayer is misled or prejudiced as a result of the
IRS’s use of a date identifier in a section 6330 notice, then the
IRS should be estopped from claiming the benefit of the
suspension of the limitations period); Carter v. United States,
110 Fed. Appx. 591, 595-596 (6th Cir. 2004) (taxpayer was denied
procedural due process where IRS letter erroneously informed
taxpayer of the limitations period, and she allowed her claim to
expire since she believed that she had until that date to file
suit); cf. Century Data Sys., Inc. v. Commissioner, 86 T.C. 157
- 10 -
(1986) (IRS could not issue a corrected notice of deficiency
after the statute of limitations for assessing the tax had
expired); Cary v. Commissioner, 48 T.C. 754, 766 (1967) (Form 872
was invalid where a revenue agent altered the tax period without
the taxpayer’s consent).
As respondent contends, it is plausible that petitioner was
not misled or prejudiced given that petitioner knew 1988 through
1990 and 1993 had been discharged in bankruptcy while 1995
through 1997 had not. On the other hand, while taking into
account the circumstances of the issuance and receipt of the
section 6330 notice, it is also plausible that petitioner may
have been prejudiced or misled. Because petitioner’s section
6330 notice referenced years and liabilities that had been
discharged in bankruptcy, she telephoned respondent’s collections
office on October 21, 2003. Petitioner testified about her
remembrances of her contacts with the IRS:
(1) A collections officer informed petitioner that the
tax for those 4 years had not been discharged in
bankruptcy, the officer could not delay collection
activity, petitioner should file an OIC promptly, and
petitioner should contact respondent’s bankruptcy
office;
(2) Ms. Bustamente2 informed petitioner that the tax
for the 4 years had been removed but added back in, and
she would have to figure it out because the IRS’s records were
2
It was represented that Ms. Bustamente is a bankruptcy
specialist in respondent’s collections insolvency office.
- 11 -
not appropriately associated with petitioner’s Social Security
number. Allegedly, Ms. Bustamente also informed petitioner that
she could not file an OIC because her account was frozen,
collections could not take any action against her, and no one
could do anything until her account was correct;
(3) Ms. Bustamente contacted petitioner on April 1,
2004, to inform petitioner that her account had been
corrected, and she remained jointly liable for 1995
through 1997. Allegedly, Ms. Bustamente also advised
petitioner that she could not submit an OIC until Mr.
Thompson was discharged from bankruptcy because a joint
tax return was filed and collections could not take any
action against her until his bankruptcy was closed.
Allegedly, Ms. Bustamente stated that the IRS would
notify petitioner when Mr. Thompson was out of
bankruptcy;
(4) petitioner called the IRS’s collections office
monthly to confirm her “extension”. But petitioner
stopped calling in May 2005 because a collections
officer, allegedly, told her to quit calling, her
account was clear, there was no attempt to collect from
her, Mr. Thompson was still in bankruptcy, petitioner
was wasting the IRS’s time, and if the IRS needed
petitioner, they would contact her; and
(5) petitioner contacted the collections office and Ms.
Bustamente after receiving the letter 2050. Ms.
Bustamente informed petitioner that Mr. Thompson
received a discharge in mid-2004. Petitioner testified
that she commented: “you mean to tell me that when the
IRS told me not to call them anymore, that there was no
effort to collect from me * * * Fred had already been
discharged”, and Ms. Bustamente allegedly replied
“apparently so. Well, we’re behind in our posting.”
Although respondent did not challenge the substance of
petitioner’s testimony, the Court, nevertheless, finds that
petitioner has not proven that she was misled or prejudiced with
respect to the notice’s issuance and her receipt thereof. See
Upchurch v. Commissioner, supra. There is no evidence in the
- 12 -
record establishing that petitioner was misled or prejudiced
other than her self-serving testimony and her notes of her
conversations with IRS personnel. Neither Ms. Bustamente nor the
collections officers were called as witnesses.3 Neither Ms.
Bustamente’s nor the collections officers’ “Case Activity
Records” or other “workpapers” were entered into evidence, and it
has not been established that Ms. Bustamente was, under the
circumstances, required to make a report or other notation of the
content of petitioner’s telephone calls. Simply put, the Court
does not accept petitioner’s self-serving testimony. See Geiger
v. Commissioner, 440 F.2d 688, 689 (9th Cir. 1971), affg. per
curiam T.C. Memo. 1969-159; Urban Redev. Corp. v. Commissioner,
294 F.2d 328, 332 (4th Cir. 1961), affg. 34 T.C. 845 (1960).
The parties agree that respondent sent the following
enclosures to petitioner with her section 6330 notice: (1) A
blank Form 12153, Request for a Collection Due Process Hearing;
(2) Publication 594, What You Should Know About the IRS
Collection Process; and (3) Publication 1660, Collection Appeal
Rights. Although the section 6330 notice and pages 2 and 3 of
Publication 594 invite taxpayers to “call us * * * at the
telephone number” provided, the section 6330 notice and
Publication 594 also explain that a taxpayer must request a
3
It was represented that Ms. Bustamente recalls having
conversations with petitioner but claims to have no recollection
of the substance of the conversations.
- 13 -
hearing (CDP hearing) within 30 days of the date on which the
section 6330 notice was issued. Publication 594 also explains
the issues that may be discussed at the CDP hearing, including
bankruptcy matters, errors in assessment, and spousal defenses.
Publication 1660 describes the procedures for requesting a CDP
hearing, the process thereafter, and the issues that may be
raised at the CDP hearing; e.g., spousal defenses.
Had petitioner requested a CDP hearing as prescribed by the
section 6330 notice and its enclosures, rather than simply
calling the IRS’s collections office, she could have protected
herself by challenging the liabilities and raising a spousal
defense at her CDP hearing as contemplated by section 6330.4
Petitioner was represented by counsel who should have filed, or
advised his client to file, either a request for a CDP hearing or
a timely request for relief from joint and several liability
pursuant to section 6015(f), notwithstanding the ambiguous
language inviting taxpayers to “call us”.
The Court also notes that petitioner failed to submit an OIC
as directed by her 2000 divorce decree. To a limited extent,
petitioner could have protected herself by submitting the OIC and
4
Sec. 6330(a) affords taxpayers the right to notice and an
opportunity for a hearing before the Commissioner can proceed
with the collection of a tax by levy. The taxpayer must request
the hearing during the 30-day period that commences the day after
the date of the section 6330 notice. See sec. 301.6330-1(c)(1),
Proced. & Admin. Regs.
- 14 -
by seeking reimbursement from Mr. Thompson. Petitioner failed to
exercise her rights with respect to Mr. Thompson and is now
attempting to use that failure as a basis for proceeding against
the Government via a request for relief from joint and several
liability. Finally, petitioner may still be able to file an OIC,
and it appears that she may still be able to enforce the
agreement with Mr. Thompson as directed by her divorce decree.
The Court finds that, on the basis of all the facts and
circumstances, the section 6330 notice issued to petitioner on
October 28, 2003, is valid.
IV. Equitable Estoppel5
Petitioner has made an argument sounding in estoppel. To
establish equitable estoppel against the Government in the Ninth
Circuit,6 a litigant must show the following: (1) The party to
be estopped must know the facts; (2) he must intend that his
conduct be acted on or must so act that the party asserting
estoppel has a right to believe it is intended; (3) the party
asserting estoppel must be ignorant of the true facts; (4) the
5
The Court may apply equitable principles to cases
properly within its jurisdiction. See Estate of Ashman v.
Commissioner, 231 F.3d 541, 545 (9th Cir. 2000) (and the cases
cited thereat), affg. T.C. Memo. 1998-145.
6
But for sec. 7463(b), an appeal would lie with the Court
of Appeals for the Ninth Circuit. See sec. 7482(b)(1)(A).
Therefore, the Court follows the law of that circuit. See Golsen
v. Commissioner, 54 T.C. 742, 757 (1970), affd. 445 F.2d 985
(10th Cir. 1971).
- 15 -
party asserting estoppel must rely on the former’s conduct to his
detriment; (5) affirmative misconduct by the Government going
beyond mere negligence; (6) the Government’s misconduct will
cause a serious injustice; and(7) the public’s interest will not
suffer undue damage.7 See United States v. Ruby Co., 588 F.2d
697, 703 (9th Cir. 1978); see also Morgan v. Heckler, 779 F.2d
544, 545 (9th Cir. 1985).
Even if the Court were to accept petitioner’s unsupported,
self-serving testimony as to the IRS’s representations, the Court
concludes that petitioner has not established the elements for
estoppel. It is well settled that a Government agent’s providing
inaccurate information does not constitute affirmative
misconduct. See Socop-Gonzalez v. INS, 272 F.3d 1176, 1184 (9th
Cir. 2001) (negligently providing misinformation or incorrect
advice is not affirmative misconduct); United States v. Manning,
787 F.2d 431, 436 (8th Cir. 1986); Sec. Settlement Corp. v.
Jachera, 772 F. Supp. 770, 774 (S.D.N.Y. 1991); see also Porter
7
The Court applies a similar test for equitable estoppel.
The party must show: (1) A false representation or wrongful,
misleading silence by the party against whom estoppel is to be
invoked; (2) an error in a statement of fact and not an opinion
or statement of law; (3) ignorance of the true facts; (4)
reasonable reliance on the act or statement; (5) a detriment
suffered because of the false representation or wrongful,
misleading silence; and (6) affirmative misconduct by the
Government. See Wright v. Commissioner, T.C. Memo. 2005-5 (and
cases cited therein).
- 16 -
v. IRS, 84 AFTR 2d 99-6994, at 99-6997, 99-2 USTC par. 50,977, at
90,293 (S.D. Iowa 1999).
V. Equitable Tolling8
A. IRS’s Representations
The central premise of equitable tolling is that the person
is excusably ignorant of the limitations period.9 See Supermail
Cargo, Inc. v. United States, 68 F.3d 1204, 1207 (9th Cir. 1995).
But equitable tolling is not available to avoid the consequences
of one’s own negligence. See Lehman v. United States, 154 F.3d
1010, 1016 (9th Cir. 1998). In order for equitable tolling to
apply, petitioner must establish that she has been pursuing her
rights diligently and one of the following additional
8
See supra notes 5 and 6 and accompanying text.
9
The limitations period specified in sec. 1.6015–5(b)(1),
Income Tax Regs., is not statutorily prescribed with respect to
sec. 6015(f). Respondent did not challenge petitioner’s argument
that equitable tolling applied, and no arguments were raised as
to whether the limitations period has been effectively
incorporated into sec. 6015(f) via the Secretary’s interpretation
or whether that interpretation is reasonable. See Chevron,
U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837,
842-843 (1984); Natl. Muffler Dealers Association v. United
States, 440 U.S. 472, 488-489 (1979). For the sake of argument,
the Court assumes that the limitations period has not been
effectively incorporated. Compare United States v. Brockamp, 519
U.S. 347, 352 (1997) (stating that the detailed, technical
language of sec. 6511, as well as its specific exceptions,
indicated that Congress did not intend for equitable tolling to
apply to sec. 6511), with Doe v. KPMG, LLP, 398 F.3d 686, 690
(5th Cir. 2005) (equitable tolling does not apply to the 3-year
limitations period of sec. 6501), and Jones v. Commissioner, T.C.
Memo. 2003-29 (equitable tolling does not apply to the 30-day
limitations period of sec. 6330(d)(1)).
- 17 -
circumstances: (1) She filed a timely, yet defective, pleading;
(2) she was induced or misled by the Government’s misconduct; or
(3) extraordinary circumstances beyond her control prevented her
from filing timely. See Huseman v. Icicle Seafoods, Inc., 471
F.3d 1116, 1121 (9th Cir. 2006) (stating that due diligence is a
requirement to equitable tolling); Seattle Audubon Soc. v.
Robertson, 931 F.2d 590, 595 (9th Cir. 1991); see also Anderson
v. United States, 220 Fed. Appx. 479, 481 (9th Cir. 2007) (citing
Irwin v. VA, 498 U.S. 89 (1990)).10
Petitioner’s testimony that the IRS’s personnel advised
petitioner that her account was frozen and no one could do
anything until the accounts were segregated and Mr. Thompson
received a discharge in bankruptcy is unsupported, self-serving
testimony that the Court is reluctant to rely on. Thus, the
Court finds that the equities do not favor tolling.
B. Attorney Malfeasance
Petitioner sent the section 6330 notice and its enclosures
to her attorney for his consideration. There is, therefore, the
implication that he had a duty to act appropriately on the
information and failed to do so.
10
The Court has applied a similar test: a taxpayer
seeking to apply equitable tolling must show, at a minimum, that
the IRS did something that reasonably induced him to believe that
the limitations period was being tolled or extended. See Hodel
v. Commissioner, T.C. Memo. 1996-348 (citing First Ala. Bank v.
United States, 981 F.2d 1226, 1228 (11th Cir. 1993)).
- 18 -
As a general rule, attorney negligence is not grounds for
invoking equitable estoppel. See Miranda v. Castro, 292 F.3d
1063, 1067-1068 (9th Cir. 2002); see also Schlueter v. Varner,
384 F.3d 69, 76 (3d Cir. 2004); Smaldone v. Senkowski, 273 F.3d
133, 138 (2d Cir. 2001) (per curiam ); Sandvik v. United States,
177 F.3d 1269, 1270 (11th Cir. 1999); Cantrell v. Knoxville Cmty.
Dev. Corp., 60 F.3d 1177, 1179-1180 (6th Cir. 1995).
But the Court of Appeals for the Ninth Circuit and some of
the other Courts of Appeals have created an exception to the
general rule. Those courts have equitably tolled a limitations
period where the client diligently pursued his claim and the
attorney’s conduct was so egregious as to constitute an
extraordinary circumstance. See Spitsyn v. Moore, 345 F.3d 796,
799-801 (9th Cir. 2003) (attorney failed to prepare and file
petition despite numerous contacts by his client and did not
return his client’s file, despite his client’s request to do so,
until the limitations period had expired); Baldayaque v. United
States, 338 F.3d 145, 150-153 (2d Cir. 2003) (attorney failed to
file a motion despite his client’s directives to do so, he
performed no legal research, he gave erroneous advice, he never
spoke with or met his client, and he failed to locate his client
when mail addressed from the attorney to his client was
returned); Seitzinger v. Reading Hosp. and Med. Ctr., 165 F.3d
236, 241-242 (3d Cir. 1999) (attorney failed to file petition,
- 19 -
failed to send copies of the complaint to his client,
affirmatively lied to his client about doing both, and failed to
keep her apprised of the case’s status despite her requests);
Burton v. U.S. Postal Serv., 612 F. Supp. 1057, 1059-1060 (N.D.
Ohio 1985) (attorney abandoned his client when he left town
without informing his client and failed to file a timely
complaint).
At first blush, petitioner’s situation appears to favor
tolling. Mr. Moats did not file, nor, as far as it appears from
the record, advise his client to file, a timely request for
relief from joint and several liability or a request for a CDP
hearing. Mr. Moats disappeared and did not return petitioner’s
file until the limitations period had expired–-apparently, a few
weeks before trial. Mr. Moats has been found ineligible to
practice law by his State bar, and he has resigned with charges
pending.
Insufficient evidence, however, was submitted to the Court
for it to make a determination as to whether the circumstances
justify invoking equitable tolling. Mr. Moats’s failure to file,
or failure to advise his client to file, a request for a CDP
hearing or a request for relief from joint and several liability
under section 6015(f) may have been a tactical decision, and no
evidence was presented as to these issues. No evidence was
submitted as to the misconduct that led to Mr. Moats’s
- 20 -
resignation or whether petitioner was one of the complainants who
had brought charges against Mr. Moats.
With so many holes in the record, the Court finds that
equitable tolling does not apply. See Auker v. Commissioner,
T.C. Memo. 1998-185 (rejecting a witness’s opinion as to a
valuation because it was “full of holes”); Kantezke v.
Commissioner, T.C. Memo. 1991-152 (rejecting a taxpayer’s
evidence because it was based on assumptions that were “full of
holes”); Vicknair v. Commissioner, T.C. Memo. 1990-434 (rejecting
a taxpayer’s testimony because it was “full of holes”).
VI. Extension of the Limitations Period
Petitioner contends that the 2-year limitations period was
extended on account of various extensions granted by the IRS to
petitioner because of the: (1) Time the IRS needed to segregate
the accounts; (2) IRS’s representations that neither it nor
petitioner could do anything until Mr. Thompson received a
discharge in bankruptcy; or (3) period in which petitioner was
preparing an OIC.
There is nothing in the record establishing that the IRS
granted extensions to petitioner other than petitioner’s self-
serving testimony, on which the Court is reluctant to rely.
The Court does not agree that the IRS’s representations
served to create an extension of the limitations period. This
argument is nothing more than a backdoor attempt at estoppel,
- 21 -
which the Court has already rejected. Additionally, there is
nothing in the record other than petitioner’s testimony showing
that the statements were made.
In the context of an OIC, section 301.7122-1(i), Proced. &
Admin. Regs., provides that the statute of limitations on
collection will be suspended in limited circumstances. No
similar provision applies with respect to the 2-year limitations
period for requests for relief from joint and several liability
under section 6015. The Court cannot read a suspension provision
into the regulation.11 Cf. Baltzell v. Mitchell, 3 F.2d 428, 430
(1st Cir. 1925) (stating that courts cannot read words that are
not present into a statute); Fleming v. Commissioner, 6 B.T.A.
900, 907 (1927) (same).
VII. Timeliness of Petitioner’s Request for Relief
Petitioner contends that because the section 6330 notice was
invalid when issued, respondent’s collection activity did not
commence on October 28, 2003. According to petitioner, the
earliest that respondent’s collection activity may have commenced
was April 2004 when Ms. Bustamente informed petitioner about the
11
Even if the Court were to find that the 2-year
limitations period for requesting relief from joint and several
liability was suspended on account of a submission of an OIC,
suspension would not apply as petitioner failed to file an OIC as
required by the regulations. Thus, an OIC was not pending within
the meaning of the regulations. Cf. sec. 301.7122-1(d)(2),
(g)(1), (i), Proced. & Admin. Regs.
- 22 -
correct amount of tax petitioner owed for each year. Thus,
petitioner’s March 20, 2006, request for relief was timely.
Because the Court has determined that the section 6330
notice issued to petitioner on October 28, 2003, was valid and
that equitable principles do not preclude application of the 2-
year limitations period, the Court finds that her request for
relief from joint and several liability was untimely. Because
her request for relief was untimely, she is not entitled to
relief, and respondent did not abuse his discretion in denying
her request. See Butler v. Commissioner, 114 T.C. 276, 292
(2000) (IRS’s denial of a request for relief from joint and
several liability under section 6015(f) is reviewed for abuse of
discretion). Accordingly, respondent’s determination is
sustained.
Other arguments made by the parties and not discussed herein
were considered and rejected as irrelevant, without merit, and/or
moot.
To reflect the foregoing,
Decision will be entered for
respondent.