T.C. Memo. 2008-188
UNITED STATES TAX COURT
SHAUN D. RYAN, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 10864-07L. Filed August 6, 2008.
Shaun D. Ryan, pro se.
Donna F. Herbert, for respondent.
MEMORANDUM OPINION
GERBER, Judge: Petitioner, pursuant to section 6330(d),1
seeks review of respondent’s determination to proceed with
collection by levy of petitioner’s unpaid 2001, 2002, and 2003
Federal income tax liabilities. The issue for our consideration
1
All section references are to the Internal Revenue Code,
and all Rule references are to the Tax Court Rules of Practice
and Procedure.
- 2 -
is whether respondent abused his discretion by determining to
proceed with the proposed levy.
Background
Respondent moved for summary judgment in this section 6330
collection case with respect to all of the issues and for the
imposition of a penalty under section 6673. By order of the
Chief Judge, petitioner was given the opportunity to file an
objection to respondent’s motion, and the motion was calendared
for a hearing on April 7, 2008, in Los Angeles, California. In
response to the Chief Judge’s order petitioner questioned the
Chief Judge’s authority and requested his Presidential
Commission, Oath of Office, Appointment Affidavit, and Senate
Confirmation. Petitioner, however, did not respond to the merits
of respondent’s motion for summary judgment, and he failed to
appear at the April 7, 2008, hearing in Los Angeles, California.
Petitioner failed to file an income tax return for 2003, and
he submitted documents purporting to be returns (containing
zeros in all boxes) for 2001 and 2002. Petitioner received
notices of deficiency for all 3 years determining income tax
deficiencies but failed to petition this Court, allowing
respondent to assess said deficiencies. Thereafter, respondent
sent petitioner a Final Notice--Notice of Intent to Levy and
Notice of Your Right to a Hearing (notice 1) with respect to the
- 3 -
2001 and 2002 liabilities. Respondent sent petitioner a similar
notice for 2003 (notice 2).
Petitioner requested a hearing with respect to notice 1 and
notice 2 on September 1, 2005, and July 18, 2006, respectively.
On January 24, 2007, Settlement Officer Nathan August (Mr.
August) sent a letter to petitioner scheduling a telephone
hearing for February 28, 2007, at 10 a.m. In that same letter,
petitioner was offered a face-to-face hearing on “any
nonfrivolous issue”. In correspondence with Mr. August
petitioner stated that his reason for disagreeing with the
proposed collection action was “simply that * * * [he] [wants] to
make sure that all the administrative procedures of IRC 6320 and
6330 have been met.” Mr. August obtained and sent to petitioner
computerized transcripts of account for each taxable year.
On February 26, 2007, Mr. August received a Form 2848, Power
of Attorney and Declaration of Representative, and facsimile from
Jeff Hubacek (Mr. Hubacek), who ostensibly represented the
interests of petitioner, advising that a “family issue” required
the rescheduling of the February 28, 2007, telephone hearing.
Previously (approximately June 24, 2004) Mr. Hubacek had been
enjoined from engaging in the preparation of fraudulent tax
returns that contained merely zeros. In enjoining Mr. Hubacek,
the Federal District Court judge found that his scheme was “to
help his customers evade taxes * * * [using] the same frivolous
- 4 -
theory propounded by Irwin Schiff”. The judge also found that
“Hubacek submits false Forms 2848 to the IRS stating that he is
an attorney or his customer’s full-time employee.” In view of
that information, Mr. August did not communicate with Mr.
Hubacek.
On February 28, 2007, Mr. August sent another letter to
petitioner to provide an opportunity for a hearing, but no
response was received from petitioner. Accordingly, on April 12,
2007, petitioner was issued Notices of Determination Concerning
Collection Action(s) under Section 6320 and/or 6330 for his 2001,
2002, and 2003 tax years, from which petitioner petitioned this
Court for review.
Discussion
Summary judgment is intended to expedite litigation and
avoid unnecessary and expensive trials. Fla. Peach Corp. v.
Commissioner, 90 T.C. 678, 681 (1988). Summary judgment may be
granted with respect to a legal issue, if there is “no genuine
issue as to any material fact and * * * a decision may be
rendered as a matter of law.” Rule 121(a) and (b); Craig v.
Commissioner, 119 T.C. 252, 259-260 (2002); Sundstrand Corp. v.
Commissioner, 98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th
Cir. 1994).
In his petition petitioner broadly and generally contends:
The tax liens and levies do not comply with the income tax
- 5 -
regulations; the Appeals officer made false and erroneous claims
in the notice of determination; and the Government may levy only
on the property of Federal employees. Petitioner did not allege
with any meaningful specificity which claims were false or
erroneous. Throughout the administrative process and in his
pleadings, petitioner has raised tax-protester and frivolous
arguments, all of which have been addressed by this and other
courts on numerous occasions. See, e.g., Carrillo v.
Commissioner, T.C. Memo. 2005-290 (and cases cited therein). We
see no need to reiterate the reasons petitioner’s arguments are
without merit or substance.
Petitioner did not petition this Court from his statutory
notices of deficiency, and respondent assessed the taxes after
the 90-day period. Accordingly, petitioner may not contest the
underlying tax liabilities. See Sego v. Commissioner, 114 T.C.
604, 610 (2000). Our review of respondent’s administrative
action in this proceeding is solely for an abuse of discretion.
See Goza v. Commissioner, 114 T.C. 176 (2000).
Other than frivolous arguments, petitioner questioned
whether the administrative procedures had been followed. Section
6330(c)(3) requires that the determination of an Appeals officer
take into consideration: (1) The verification that the
requirements of any applicable law or administrative procedure
have been met; (2) issues raised by the taxpayer; and (3) whether
- 6 -
any proposed collection action balances the need for the
efficient collection of taxes with the legitimate concern of the
person that any collection be no more intrusive than necessary.
Mr. August supplied petitioner with transcripts of his
account, which complied with the verification requirement. That
adequately addressed the only nonfrivolous issue petitioner
raised and, as indicated above, there was no need for
petitioner’s well-worn frivolous issues to be addressed.
Finally, petitioner did not raise any collection alternatives or
practical collection concerns. Accordingly, we find that there
was no abuse of discretion in the decision to proceed with
collection activity.
Respondent also seeks the imposition of a penalty under
section 6673 on the grounds that petitioner has instituted or
maintained this proceeding primarily for delay and/or that his
position in this proceeding is frivolous or groundless. Sec.
6673(a)(1). Section 6673 applies to collection due process
proceedings, and a penalty, not in excess of $25,000, may be
imposed in this proceeding. See Pierson v. Commissioner, 115
T.C. 576 (2000).
Other than questioning whether the administrative procedures
were followed, petitioner has not raised any questions,
arguments, or issues other than those which have long been
labeled frivolous. Typical of petitioner’s groundless and
- 7 -
frivolous positions is that because he is not a Federal employee,
he is not subject to the tax or a levy based on the tax.
Petitioner has wasted the time of the legal system and respondent
by pursuing positions which have been rejected for more than 20
years. Petitioner did not respond to the Court’s orders or
appear at the trial session, and he also failed to raise
meaningful arguments. It is clear to this Court that petitioner
instituted and maintained this proceeding for purposes of delay.
The circumstances of this case warrant the imposition of a $3,000
penalty to address petitioner’s actions and to discourage him
from similar actions in the future.
To reflect the foregoing,
An appropriate order and
decision will be entered.