T.C. Memo. 2008-178
UNITED STATES TAX COURT
RONALD C. PARKER, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 10148-07L. Filed July 29, 2008.
Ronald C. Parker, pro se.
Lisa K. Hunter, for respondent.
MEMORANDUM OPINION
CHIECHI, Judge: This case is before the Court on respon-
dent’s motion for summary judgment (respondent’s motion).1 We
shall grant respondent’s motion.
1
Although the Court ordered petitioner to file a response to
respondent’s motion, petitioner failed to do so.
- 2 -
Background
The record establishes and/or the parties do not dispute the
following.
Petitioner’s address shown in the petition in this case was
in Omaha, Nebraska.
Petitioner did not file a Federal income tax (tax) return
for any of his taxable years 2000, 2001, and 2002. Respondent
prepared a substitute for return for each of those years.
On April 21, 2005, respondent issued to petitioner a notice
of deficiency with respect to his taxable years 2000, 2001, and
2002 (notice of deficiency for 2000, 2001, and 2002), which he
received. In that notice, respondent determined the following
deficiencies in, and additions to, petitioner’s tax:
Additions to Tax Under
Year Deficiency Sec. 6651(a)(1)2 Sec. 6651(a)(2) Sec. 6654(a)
*
2000 $6,367 $1,432.58 $1,559.92 $340.08
*
2001 14,049 3,161.03 2,599.07 561.46
*
2002 10,892 2,450.70 1,361.50 363.98
*Respondent determined that the addition to tax will
continue to accrue from the due date of the return at a rate of
0.5 percent for each month, or fraction thereof, of nonpayment,
not exceeding 25 percent.
Petitioner did not file a petition with the Court with
respect to the notice of deficiency for 2000, 2001, and 2002.
2
All section references are to the Internal Revenue Code in
effect at all relevant times. All Rule references are to the Tax
Court Rules of Practice and Procedure.
- 3 -
On September 26, 2005, respondent assessed the following
tax, additions to tax, and interest as provided by law for
petitioner’s taxable years 2000, 2001, and 2002:
Additions to Tax Under
Sec. Sec. Sec.
Year Tax 6651(a)(1) 6651(a)(2) 6654(a) Interest
2000 $6,367 $1,432.58 $1,559.92 $340.08 $2,176.88
2001 14,049 3,161.03 2,599.07 561.46 3,331.58
2002 10,892 2,450.70 1,361.50 363.98 1,698.78
On September 26, 2005, respondent issued to petitioner
respective notices of balance due with respect to any unpaid
assessed amounts for petitioner’s taxable years 2000, 2001, and
2002.
On November 14, 2005, respondent assessed additional addi-
tions to tax under section 6651(a)(2) of $31.83, $421.47, and
$326.76 for petitioner’s taxable years 2000, 2001, and 2002,
respectively.
On November 14, 2005, respondent issued to petitioner
respective notices of balance due with respect to any unpaid
assessed amounts for petitioner’s taxable years 2000, 2001, and
2002.
On December 19, 2005, respondent assessed additional addi-
tions to tax under section 6651(a)(2) of $70.24 and $54.46 for
petitioner’s taxable years 2001 and 2002, respectively.
On December 19, 2005, respondent issued to petitioner
respective notices of balance due with respect to any unpaid
- 4 -
assessed amounts for petitioner’s taxable years 2001 and 2002.
(We shall refer to any unpaid assessed amounts with respect to
petitioner’s respective taxable years 2000, 2001, and 2002, as
well as interest as provided by law accrued thereafter, as
petitioner’s unpaid liabilities for 2000, 2001, and 2002.)
On August 29, 2006, respondent issued to petitioner a notice
of Federal tax lien filing and your right to a hearing under IRC
6320 (notice of tax lien) with respect to petitioner’s unpaid
liabilities for 2000, 2001, and 2002. Petitioner did not request
a hearing with respondent’s Appeals Office (Appeals Office) with
respect to that notice.
On October 16, 2006, respondent issued to petitioner a final
notice of intent to levy and notice of your right to a hearing
(notice of intent to levy) with respect to petitioner’s unpaid
liabilities for 2000, 2001, and 2002.
On November 13, 2006, petitioner timely submitted to respon-
dent Form 12153, Request for a Collection Due Process Hearing
(petitioner’s Form 12153), with respect to the notice of intent
to levy. In that form, petitioner indicated his disagreement
with the notice of intent to levy and requested a hearing with
the Appeals Office. In petitioner’s Form 12153, petitioner
stated in pertinent part:
I TOLD IRS IN OMAHA, MOST OF MY MONEY CAME FROM MY
MOTHER WHEN SHE DIED AND SOME CAME FROM GAMBLING. THEY
COULD NOT PROVE THE MONEY CAME FROM GAMBLING AND I
CANNOT PROVE MONEY CAME FROM MY MOTHER SO THEY JUST
- 5 -
DECIDED THE MONEY WAS GAMBLING. NO WAY COULD ANYONE
WIN THAT MUCH MONEY AT A CASINO WITH NO CASINO RECORD.
By letter dated December 5, 2006 (respondent’s December 5,
2006 letter), respondent acknowledged receipt of petitioner’s
Form 12153. That letter stated in pertinent part:
: 6. To expedite the processing of your request,
please complete the enclosed Collection Informa-
tion Statement, and return this form in the enve-
lope provided by December 14, 2006.
: 7. Additional information is needed to expedite
the processing of your request. Please contact me
at the number listed above by December 14, 2006.
If I do not hear from you by this date, your re-
quest will be forwarded to your local Appeals
Office for consideration.
: 8. Other IRS accepts an Audit Reconsidera-
tion Request If: You have informa-
tion that we have not considered
previously which might change the
amount of tax you owe, or credit
you believe you are entitled to. I
have enclosed Publication 3598 for
your convenience. If you would
like to request an Audit Reconsid-
eration at this time, our Collec-
tions Department can place a hold
on your account to allow you to
process your request. Please con-
tact me at the number listed above
if you are considering an Audit
Reconsideration.
Petitioner did not respond to respondent’s December 5, 2006
letter.
By letter dated December 21, 2006, respondent informed
petitioner that he would be “notified within 60 days of the date
and time of your hearing, by an Appeals office.”
- 6 -
A settlement officer with the Appeals Office who was as-
signed petitioner’s Form 12153 (settlement officer) sent peti-
tioner a letter dated February 27, 2007 (settlement officer’s
February 27, 2007 letter). That letter stated in pertinent part:
Appeals received your request for a Collection Due
Process (CDP) Hearing. I have scheduled a telephone
conference call for you on March 20, 2007 at 1:30 CST.
This call will be your primary opportunity to discuss
with me the reasons you disagree with the collection
action and/or to discuss alternatives to the collection
action.
* * * * * * *
If this time is not convenient for you, the phone
number has changed, or you would prefer your conference
to be held by face-to-face at the Appeals office clos-
est to your current residence, the school you attend or
your place of employment or if you are a business, your
business address, or by correspondence, please let me
know within fourteen (14) days from the date of this
letter. I will discuss with you if there are any
offices that may be more convenient for you (e.g.,
Appeals office nearest place of employment or school)
when you contact me.
* * * * * * *
During the hearing, I must consider:
• Whether the IRS met all the requirements of
any applicable law or administrative proce-
dure
• Any relevant issues you wish to discuss.
These can include:
1. Collection alternatives to levy such as
full payment of the liability, install-
ment agreement, offer in compromise or
temporary suspension of collection ac-
tion if the action imposes a hardship
condition. * * *
- 7 -
2. Challenges to the appropriateness of
collection action. * * *
3. Spousal defenses, when applicable.
• We may also consider whether you owe the
amount due, but only if you have not other-
wise had an opportunity to dispute it with
Appeals or did not receive a statutory notice
of deficiency.
• We will balance the IRS’ need for efficient
tax collection and your legitimate concern
that the collection action be no more intru-
sive than necessary.
* * * * * * *
Regarding the liability you are raising:
You are not able to dispute the liability because you
had a prior opportunity to do so when the lien was
filed in August 2006 for the same periods; therefore,
this issue cannot be disputed in Appeals.
How do you wish to resolve your liabilities? For me to
consider alternative collection methods such as an
installment agreement or offer in compromise, you must
provide any items listed below. In addition, you must
have filed all federal tax returns required to be
filed.
1. Collection alternative(s).
2. A completed Collection Information Statement
(Form 433-A for individuals and/or Form 433-B
for businesses) including all required at-
tachments.
3. Form 656
4. The $150 application fee of Form 656-A, In-
come Certification for Offer in Compromise
Application (OIC) Fee and Payments.
5. Verification of the 20 percent payment with
the lump sum offer, or a signed Form 656-A.
- 8 -
6. Verification of the first installment payment
on a periodic payment offer, or a signed Form
656-A.
7. A current statement of all investments, in-
cluding borrowing terms.
On March 20, 2007, the settlement officer held a telephonic
conference (March 20, 2007 conference) with petitioner. During
that conference, petitioner claimed that he did not owe any tax.
The settlement officer informed petitioner during the March 20,
2007 conference that he was not entitled to challenge the respec-
tive underlying tax liabilities for his taxable years 2000, 2001,
and 2002 because he had had a prior opportunity to dispute those
liabilities (1) when he received the notice of deficiency for
2000, 2001, and 20023 and (2) when he received the notice of tax
lien with respect to those years. During the March 20, 2007
conference, the settlement officer also informed petitioner that
she could consider ways to resolve petitioner’s unpaid liabili-
ties for 2000, 2001, and 2002, but petitioner stated that he was
not interested. The settlement officer asked petitioner during
that conference if he had submitted any of the information
requested in the settlement officer’s February 27, 2007 letter.
Petitioner replied that he had not. The settlement officer
advised petitioner during the March 20, 2007 conference that she
3
Petitioner did not dispute during the March 20, 2007 con-
ference, and does not dispute here, that he received the notice
of deficiency for 2000, 2001, and 2002.
- 9 -
intended to issue a notice of determination with respect to
petitioner’s unpaid liabilities for 2000, 2001, and 2002 in which
she would sustain the notice of intent to levy.
On April 5, 2007, the Appeals Office issued to petitioner a
notice of determination concerning collection action(s) under
section 6320 and/or 6330 (notice of determination) with respect
to petitioner’s taxable years 2000, 2001, and 2002. That notice
stated in pertinent part: “Relief from the proposed levy is
denied.”
The notice of determination included an attachment that
stated in pertinent part:
SUMMARY AND RECOMMENDATION
You requested a Collection Due Process (CDP) hearing
under Internal Revenue Code § 6330 as a result of
receiving Letter 11, Final Notice, Notice of Intent to
Levy and Notice of Your Right to a Hearing. You failed
to provide financial information as requested; there-
fore no alternative means of collection is available to
you.
Appeals determination is that relief is not granted
from the levy action. No relief can be granted because
you failed to propose an acceptable collection resolu-
tion.
BRIEF BACKGROUND
You requested a Collection Due Process (CDP) hearing
under Internal Revenue Code § 6330 as a result of
receiving Letter 11, Final Notice, Notice of Intent to
Levy and Notice of Your Right to a Hearing.
Your Form 1040, Individual Income Tax Return for tax
years ending December 31, 2000, December 31, 2001 and
December 31, 2002 were filed for you through the Sub-
stitute for Return Program because you did not volun-
- 10 -
tarily file these returns.
A letter was mailed to you dated February 27, 2007
setting up a telephonic conference for March 20, 2007.
This letter requested collection alternatives and
financial information to determine your ability to pay.
This letter gave you the opportunity to have a face to
face hearing at the Appeals office closest to your
residence or by correspondence; however, you did not
request either.
The requested information was never received.
You called the Settlement Officer on March 20, 2007,
the day of the scheduled conference and agreed to
conduct your conference over the phone.
DISCUSSION and ANALYSIS
Under IRC § 6330(c)(2)(A) a person may raise at a
Collection Due Process hearing any relevant issue
relating to the unpaid tax or the proposed levy,
including-
(i) appropriate spousal defenses;
(ii) challenges to the appropriateness of
collection actions; and
(iii) offers of collection alternatives, which
may include the posting of a bond, the
substitution of other assets, an
installment agreement, or offer-in-
compromise.
IRC § 6331(a) states that if any person liable to pay
any tax neglects or refuses to pay the same after
notice and demand, it shall be lawful for the Secretary
to collect such tax by levy upon all property and
rights to property belonging to such person. IRC
§ 6331(d) states a levy may be made after the Secretary
has notified such person in writing of his intention to
make such levy and the notice is required to be no less
than 30 days before the day of the levy.
Legal and Procedural Requirements:
With the best information available, the require-
ments of various applicable law or administrative
- 11 -
procedures have been met.
Verified through review of computer transcripts of
your account:
• Assessments were made on the CDP notice
periods per IRC § 6201.
• The notice and demand for payment letter was
mailed to the last known address within 60
days of the assessment, as required by IRC
§ 6303.
• There was a balance due when the CDP notice
was issued per IRC § 6322 and 6331(a).
• There is no indication that you had a pending
bankruptcy when the CDP notice was issued or
that you currently have a pending bankruptcy.
The Settlement Officer has not had any prior in-
volvement regarding these liabilities under Col-
lection Due Process in either a previous Appeals
hearing or Collection activity.
Issues relating to the unpaid liability
• On your Form 12153, Request for a Collection
Due Process Hearing, you indicated that you:
• You told the IRS in Omaha that most of the
money came from your mother when she died and
some came from gambling. They could not
prove the money came from gambling and you
cannot prove it came from your mother, so
they just decided the money was gambling. No
way could anyone win that much money at a
casino with no casino record.
According to our records you previously received a CDP
Notice in August 2006 with respect to the same tax and
tax period under IRC § 6320 and did not request a CDP
hearing with respect to that earlier CDP Notice; there-
fore, you already had an opportunity to dispute the
existence or amount of the underlying tax liability.
Also, according to our records a Notice of Deficiency
letter was mailed to you. This letter informed you
- 12 -
that the IRS determined that there was a deficiency
(increase) in your tax for this year. This letter gave
you the right to contest this determination in Tax
Court, 90 days from the date of the letter. There is
no indication that you petitioned the Tax Court or that
you did not receive this notice. You failed to propose
an acceptable collection resolution.
If you want audit reconsideration, see enclosed Publi-
cation 3598.
• You raised the liability issue.
• You presented no relevant challenges to the
appropriateness of the collection action.
• No other issues were raised.
Balancing efficient tax collection with concern regard-
ing intrusiveness:
You did not provide the requested financial data neces-
sary to make a determination concerning an alternate
means of collection. Given the facts and circumstances
of your case, the levy is the only means remaining to
collect the tax. Therefore, it balances the need for
efficient collection of taxes with a taxpayer’s legiti-
mate concern that the collection action be no more
intrusive than necessary. [Reproduced literally.]
On May 8, 2007, petitioner filed a petition commencing this
case. On June 26, 2007, petitioner filed an amended petition.
Petitioner alleged in the amended petition that he disagrees with
“the determination contained in the notice issued by the Internal
Revenue Service for the year(s) or period(s) 2000-2001 & 2003”.4
4
Although petitioner alleged in the amended petition that he
disagrees with “the determination contained in the notice issued
by the Internal Revenue Service for the year(s) or period(s)
2000-2001 & 2003”, the notice of determination that respondent
issued to petitioner and that petitioner attached to the petition
and the amended petition pertains to petitioner’s taxable years
(continued...)
- 13 -
In the amended petition, petitioner further alleged in pertinent
part: “I ALSO REALIZE THAT IRS IS RELUTANT [sic] TO SPEND AS
MUCH TIME AS THEY DID TO PROVE THEIR CASE (WHICH THEY HAVE NOT)
BECAUSE THEY MIGHT BE REPRIMANDED FOR NOT DROPPING THE CASE.
THAT WOULD ALSO TAKE AWAY (1) ONE ATTABOY [sic].”
Discussion
The Court may grant summary judgment where there is no
genuine issue of material fact and a decision may be rendered as
a matter of law. Rule 121(b); Sundstrand Corp. v. Commissioner,
98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th Cir. 1994). We
conclude that there are no genuine issues of material fact
regarding the questions raised in respondent’s motion.
Petitioner did not file a petition with the Court with
respect to the notice of deficiency for 2000, 2001, and 2002.
Where, as is the case here, the validity of the underlying tax
liability is not properly placed at issue, the Court will review
the determination of the Commissioner of Internal Revenue for
abuse of discretion. Sego v. Commissioner, 114 T.C. 604, 610
(2000); Goza v. Commissioner, 114 T.C. 176, 182 (2000).
Based upon our examination of the entire record before us,
we find that respondent did not abuse respondent’s discretion in
making the determinations in the notice of determination with
4
(...continued)
2000, 2001, and 2002, and not 2003.
- 14 -
respect to petitioner’s taxable years 2000, 2001, and 2002.
We have considered all of the parties’ contentions and
arguments that are not discussed herein, and we find them to be
without merit, irrelevant, and/or moot.
On the record before us, we shall grant respondent’s motion.
To reflect the foregoing,
An order granting respondent’s
motion and decision for respondent
will be entered.