T.C. Memo. 2008-151
UNITED STATES TAX COURT
WENZELL O. TAYLOR, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 4504-06L. Filed June 12, 2008.
Wenzell O. Taylor, pro se.
Roger W. Bracken, for respondent.
MEMORANDUM OPINION
WELLS, Judge: This matter is before the Court on
petitioner’s and respondent’s cross-motions for summary judgment
pursuant to Rule 121. The issues we must decide are: (1)
Whether respondent’s Appeals Office abused its discretion in
determining to proceed with collection of petitioner’s income tax
- 2 -
liabilities for taxable years 1998, 1999, 2000, 2001, and 2002,
and (2) whether the Court, sua sponte, should impose a penalty
under section 6673.1 After considering the parties’ cross-
motions for summary judgment, petitioner’s response, and
respondent’s response, we conclude that there remains no issue of
material fact that requires trial or hearing. For the reasons
stated below, we shall grant respondent’s motion for summary
judgment. Unless otherwise indicated, all Rule references are to
the Tax Court Rules of Practice and Procedure, and all section
references are to the Internal Revenue Code, as amended.
Background
At the time of filing the petition, petitioner resided in
Washington, D.C.
Petitioner filed purported Federal tax returns for taxable
years 1998, 1999, 2000, 2001, and 2002. On each of the returns
petitioner indicated all zeros and showed no taxable income
received. Attached to the individual income tax returns for
taxable years 1998, 1999, 2001 and 2002, petitioner included
frivolous statements. Respondent did not accept petitioner’s
purported Federal income tax returns for taxable years 1998
1
Respondent also filed a motion to dismiss for lack of
jurisdiction and to strike as to the taxable year 1999.
Subsequently, respondent filed a motion to withdraw respondent’s
motion to dismiss for lack of jurisdiction and to strike as to
taxable year 1999. We find that there is jurisdiction regarding
taxable year 1999 and will grant respondent’s motion to withdraw.
- 3 -
through 2002 and sent petitioner a notice of deficiency for those
years. Petitioner did not petition this Court for
redetermination of the deficiencies and additions to tax for any
of the taxable years in the notice. Respondent assessed tax
deficiencies and interest for taxable years 1998 through 2002.
Petitioner had withholding credits for taxable years 1998, 1999,
and 2000. Respondent also assessed additions to tax and
penalties for taxable years 1999, 2000, and 2001 and a late
filing addition to tax and a failure to pay addition to tax for
taxable year 2002. Respondent sent petitioner a notice and
demand for payment for taxable years 1998 through 2002.
On April 1, 2005, respondent sent petitioner a Notice of
Federal Tax Lien Filing and Your Right to a Hearing for taxable
years 1998 and 2000 through 2002. On August 5, 2005, respondent
received from petitioner a Form 12153, Request for Collection Due
Process Hearing, dated May 4, 2005, for taxable years 1998 and
2000 through 2002. On Form 12153 petitioner’s only statement was
that “I do not believe that all of the requirements of applicable
law and administrative procedures have been met in my case.” On
October 10, 2005, Settlement Officer D.W. DeVincentz (Settlement
Officer DeVincentz) was assigned petitioner’s appeal of the
proposed collection action for taxable years 1998, 2000 through
2002. On November 4, 2005, as part of the Appeals hearing,
Settlement Officer DeVincentz reviewed petitioner’s request for a
- 4 -
hearing for 1998 and 2000 through 2002; confirmed that notice and
demand for payment was made for each taxable year; confirmed that
petitioner owed income taxes for 1998 and 2000 through 2002; and
confirmed that the requirements of the applicable law and
administrative procedures had been met.
On November 7, 2005, Settlement Officer DeVincentz sent a
letter to petitioner notifying him of the time and date of a
telephone conference.
On November 14, 2005, respondent received a letter from
petitioner dated November 9, 2005, requesting an alternative date
for the conference and that the conference be conducted face-to-
face; petitioner also set forth frivolous arguments. On
November 16, 2005, Settlement Officer DeVincentz sent petitioner
a letter stating that petitioner’s request for a hearing was
timely made.
On review of petitioner’s November 9, 2005, letter,
Settlement Officer DeVincentz was of the view that petitioner’s
frivolous arguments did not justify an in-person hearing. In a
December 5, 2005, letter, Settlement Officer DeVincentz set a
telephone conference for January 24, 2006. In the December 5,
2005, letter, Settlement Officer DeVincentz also stated to
petitioner that if he had legitimate issues to discuss regarding
his unpaid tax liabilities, petitioner should send written
notification of the issues within 15 days of the letter.
- 5 -
On November 9, 2005, respondent sent petitioner a Notice of
Federal Tax Lien Filing and Your Right to a Hearing for taxable
year 1999. On December 9, 2005, respondent received
correspondence dated December 5, 2005, requesting a hearing for
taxable year 1999. Subsequently, Settlement Officer DeVincentz
incorporated that hearing request into petitioner’s hearing
request for taxable years 1998 and 2000 through 2002.
On December 20, 2005, Settlement Officer DeVincentz received
a letter from petitioner dated December 16, 2005, that stated
that it was in reaction to respondent’s collections due process
hearing letter dated December 5, 2005. This letter rejected the
January 24, 2006, telephone conference date and asserted
frivolous arguments. Petitioner failed to call Settlement
Officer DeVincentz for the scheduled January 24, 2006, telephone
conference.
Respondent sent petitioner a Notice of Determination
Concerning Collection Action, dated February 7, 2006, that
maintained the lien for taxable years 1998 through 2002. On
March 3, 2006, petitioner filed a petition with this Court for
taxable years 1998, 1999, 2000, 2001, and 2002. On October 19,
2006, petitioner filed an amended petition with this Court. In
the amended petition, petitioner requested a face-to-face
collections hearing.
- 6 -
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); Jacklin v. Commissioner, 79 T.C. 340, 344 (1982). 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 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 6321 imposes a lien in favor of the United States
upon all property and rights to property of a taxpayer liable for
tax where there exists a failure to pay the tax liability after
demand for payment. The lien generally arises at the time the
assessment is made. Sec. 6322. Section 6323, however, provides
that such lien shall not be valid against any purchaser, holder
of a security interest, mechanic’s lienor, or judgment lien
creditor until the Secretary files a notice of lien with the
- 7 -
appropriate public officials. Section 6320 then sets forth
procedures applicable to afford protections for taxpayers in lien
situations.
Section 6320 requires that the Secretary give the taxpayer
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 the
Commissioner’s Appeals office.
Section 6320(c) provides that an Appeals Office hearing
generally should be conducted consistently with the procedures
set forth in section 6330(c), (d), and (e). The 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 made may raise any relevant
issues relating to the unpaid tax or 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 liability, however, only if the person did not receive any
statutory notice of deficiency for such tax liability or did not
otherwise have an opportunity to dispute such tax liability.
Sec. 6330(c)(2)(B).
Where the validity of the underlying tax liability is
properly in issue, the Court will review the matter de novo.
- 8 -
Where the validity of the underlying tax is not properly at
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).
The record indicates that petitioner raised frivolous
arguments throughout the section 6320 administrative process and
in his petition and amended petition to this Court. We do not
address petitioner’s frivolous arguments with somber reasoning
and copious citations to 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).
Respondent argues that section 6330(c)(2)(B) precludes
petitioner from challenging the underlying tax liabilities for
taxable years 1998 through 2002 because petitioner received a
notice of deficiency for those years and failed to timely
petition this Court. In his response to respondent’s motion for
summary judgment, petitioner’s only legitimate argument is that
respondent never provided him with an opportunity to participate
in a CDP hearing.
Once a taxpayer has been given a reasonable opportunity for
a hearing but has failed to avail himself or herself of that
opportunity, we have approved the making of a determination to
proceed with collection on the basis of the Appeals officer’s
- 9 -
review of the case file. See, e.g., Taylor v. Commissioner, T.C.
Memo. 2004-25, affd. 130 Fed. Appx. 934 (9th Cir. 2005);
Leineweber v. Commissioner, T.C. Memo. 2004-17; Armstrong v.
Commissioner, T.C. Memo. 2002-224; Gougler v. Commissioner, T.C.
Memo. 2002-185; Mann v. Commissioner, T.C. Memo. 2002-48.
We note that respondent offered a face-to-face hearing to
allow petitioner to raise any meaningful issues regarding his tax
liability or the proposed lien, which petitioner failed to do.
As to petitioner’s claim that he is entitled to an in-person
hearing, this Court has noted on a number of occasions that
hearings conducted under sections 6320 and 6330 are informal
proceedings, not formal adjudications. Katz v. Commissioner, 115
T.C. 329, 337 (2000); Davis v. Commissioner, 115 T.C. 35, 41
(2000). There inheres no right to subpoena witnesses or
documents in connection with these hearings. Roberts v.
Commissioner, 118 T.C. 365, 372 (2002), affd. 329 F.3d 1224 (11th
Cir. 2003); Nestor v. Commissioner, 118 T.C. 162, 166-167 (2002);
Davis v. Commissioner, supra at 41-42; see sec. 301.6320-1(d)(2),
Q&A-D6, Proced. & Admin. Regs.
Consequently, we find that petitioner was given a hearing
for taxable years 1998 through 2002 and failed to raise any
legitimate arguments or collection alternatives. Accordingly, we
hold that no genuine issue of material fact exists requiring
trial and that respondent is entitled to summary judgment.
- 10 -
Respondent’s determination to maintain the lien to collect
petitioner’s tax liabilities for 1998, 1999, 2000, 2001, and 2002
was not an abuse of discretion.
Section 6673(a)(1) provides that this Court may require the
taxpayer to pay a penalty not in excess of $25,000 whenever it
appears to this Court that: (a) The proceedings were instituted
or maintained by the taxpayer primarily for delay; (b) the
taxpayer’s position is frivolous or groundless; or (c) the
taxpayer unreasonably failed to pursue available administrative
remedies.
Respondent has not sought a section 6673 penalty, however,
the Court considers the issue sua sponte. Although we do not
impose a penalty on petitioner, we take this opportunity to
admonish petitioner that the Court will consider imposing such a
penalty should he return to the Court in the future in an attempt
to delay collection or advance frivolous or groundless arguments.
We have considered the parties’ remaining arguments and
conclude that the arguments are either without merit or
unnecessary to reach.
To reflect the foregoing,
An appropriate order and
decision will be entered.