T.C. Summary Opinion 2008-48
UNITED STATES TAX COURT
CHARLES A. ROBINSON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 19057-05S. Filed April 30, 2008.
Charles A. Robinson, pro se.
Laura A. Price, 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, 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.
Background
Petitioner Charles A. Robinson did not appear at trial.
Instead, this case was submitted fully stipulated at the trial
session of the Court held at Jacksonville, Florida, on February
5, 2008. The parties’ agreed facts and accompanying exhibits are
incorporated herein by this reference. See Rule 122.
At the time the petition was filed, petitioner resided in
Florida.
According to the Internal Revenue Service (IRS) case
activity record,2 petitioner and his wife both have health
problems that either restrict or prohibit their employment. They
also have financial problems, including their outstanding debt to
the IRS. Despite owing money on “several charge cards” and using
money earmarked for a payment to the IRS to repair home damage
caused by “three hurricanes in 6 weeks”, petitioner claims to
consider his “IRS problems [his] first priority.”
2
Although some of the exhibits entered into evidence
discuss petitioner’s outstanding balances from taxable years
2001, 2002, 2003, and 2004, only taxable years 1998 and 1999 are
properly before the Court. See sec. 6330(d). Similarly,
although there are references to petitioner’s failure to honor a
previous installment agreement, that failed agreement is not part
of the current proceedings.
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On March 25, 2005, respondent sent petitioner a Final Notice
of Intent to Levy and Notice of Your Right to a Hearing (final
notice) in respect of petitioner’s 1998 and 1999 tax years.
In response, petitioner timely filed a Form 12153, Request
for a Collection Due Process Hearing, on April 6, 2005. In that
request, petitioner made clear that he did not dispute the
underlying tax liability but that he wished to discuss an
installment agreement.
During the negotiation of a potential installment agreement,
respondent determined that petitioner had monthly disposable
income of $1,920. In contrast, petitioner calculated a monthly
disposable income of $879. Of some note is the fact that
although respondent alleges that petitioner has stock that could
be sold to fully satisfy his tax debt, petitioner’s only
reference to the stock is a listing of “dividends” received
monthly on his income and expense statement.
Petitioner proposed paying $180 per month to satisfy his tax
obligations. Because respondent’s settlement officer determined
petitioner could pay $1,920 per month, she rejected the proposal.
On September 13, 2005, respondent mailed petitioner a Notice of
Determination Concerning Collection Action under Section 6320
and/or 6330 (notice of determination), sustaining the proposed
levy because petitioner did not offer any viable collection
alternative.
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Petitioner filed this action in order to have us review
respondent’s determination.
Discussion
Section 6330 generally provides that the Commissioner cannot
proceed with collection by levy until the taxpayer has been given
notice and the opportunity for an administrative review of the
matter (in the form of an Appeals Office hearing) and, if
dissatisfied, with judicial review of the administrative
determination. See Davis v. Commissioner, 115 T.C. 35, 37
(2000); Goza v. Commissioner, 114 T.C. 176, 179 (2000); see also
sec. 6330. Petitioner has had the benefits of these protections.
In determining that a proposed levy may proceed, the Appeals
Office is required to take into consideration: (1) The
verification presented by the Secretary that the requirements of
applicable law and administrative procedures have been met, (2)
the relevant issues raised by the taxpayer, and (3) whether the
proposed levy action appropriately balances the need for
efficient collection of taxes with the taxpayer’s concerns
regarding the intrusiveness of the proposed levy action. Sec.
6330(c)(3). The settlement officer did verify that all legal and
procedural requirements had been met, and she reviewed the single
issue raised by the taxpayer: an installment agreement.
Because there is no dispute as to the underlying liability,
our review is performed under an abuse of discretion standard.
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See Lunsford v. Commissioner, 117 T.C. 183, 185 (2001); Goza v.
Commissioner, supra at 182; cf. sec. 6330(c)(2)(B). A settlement
officer abuses her discretion if her determination is exercised
“arbitrarily, capriciously, or without sound basis in fact.”
Mailman v. Commissioner, 91 T.C. 1079, 1084 (1988); see also
Freije v. Commissioner, 125 T.C. 14, 23 (2005). On the basis of
the record, it was not an abuse of discretion to determine that
petitioner could pay more than he proposed and that the proposed
levy should proceed.
Conclusion
Without the benefit of any testimony from petitioner, we are
unable to ascertain how much petitioner was truly capable of
paying toward his Federal tax obligations for 1998 and 1999.
Fortunately, that is not our charge here. We are asked only to
decide whether respondent abused his discretion in rejecting
petitioner’s offer and determining that the levy should proceed;
it is clear from the record before us that he did not.
Therefore, we sustain respondent’s determination.
To reflect our disposition of the disputed issue,
Decision will be entered
for respondent.