T.C. Memo. 2009-110
UNITED STATES TAX COURT
MARIAN L. MOLINE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 171-07L. Filed May 20, 2009.
Marian L. Moline, pro se.
Steven M. Webster, for respondent.
MEMORANDUM OPINION
JACOBS, Judge: This case arises from a petition for
judicial review pursuant to section 6330(d) of respondent’s
determination to proceed with collection of petitioner’s unpaid
Federal income taxes for 2001 by levy. The sole issue involved
is whether respondent’s determination constitutes an abuse of
- 2 -
discretion. All section references are to the Internal Revenue
Code in effect for 2001.
Background
At the time she filed her petition, petitioner resided in
Kansas.
Petitioner failed to file Federal income tax returns for
2000 and 2001. As a consequence, respondent prepared substitutes
for returns pursuant to authority granted under section 6020(b).
On June 4, 2004, separate notices of deficiency for the 2000 and
2001 tax years were mailed to petitioner. Petitioner sent copies
of the notices of deficiency for 2000 and 2001 to the Court, each
containing a handwritten notation stating: “I hereby refute and
invalidate this unsigned presentment, without dishonor. I do not
owe this money! All rights reserved, Without Prejudice, UCC 1-
207.” The Court received the documents on September 1, 2004, and
the matter was assigned docket No. 16198-04.
On September 7, 2004, the Court ordered petitioner to file a
proper amended petition and pay the filing fee on or before
October 22, 2004. On January 4, 2005, the Court dismissed the
case for lack of jurisdiction when no response was received.
On November 7, 2005, respondent sent petitioner written
notice that respondent intended to levy on petitioner’s assets to
collect her unpaid tax liability for 2000. Petitioner did not
respond to that notice.
- 3 -
On April 5, 2006, respondent sent petitioner written notice
that respondent intended to levy on petitioner’s assets to
collect her unpaid tax liability for 2001. In response,
petitioner timely filed Form 12153, Request for a Collection Due
Process Hearing (section 6330 hearing). On this form petitioner
wrote:
-This process is not legal according to the highest law of
the land!
-You have no legal authority to levy/seizure.
Attached to petitioner’s request for a hearing were two printed
form documents, one indicating that petitioner was not a resident
of the United States, but rather was a resident of one of the 50
republic sovereign States, and the other demanding identification
information of respondent’s representative who issued the notice
of intent to levy, as well as copies of his driver’s license,
Social Security card, and IRS identification card.
The case was assigned to Settlement Officer Bart Hill of
respondent’s Appeals Office. On October 12, 2006, Settlement
Officer Hill sent petitioner a letter scheduling a telephone
section 6330 hearing with petitioner on November 15, 2006, at 1
p.m. central standard time. The letter informed petitioner that
the issues she raised “are those that Courts have determined are
frivolous or Appeals does not consider.” Respondent advised
petitioner she was not entitled to a face-to-face hearing as to
the positions set forth in her request for a section 6330 hearing
- 4 -
because they were frivolous. However, she was advised that she
would be allowed a face-to-face conference with respect to any
nonfrivolous issue. Petitioner was informed that she had to set
forth the nonfrivolous issue in writing or call Settlement
Officer Hill within 14 days from the date of the letter to
qualify for a face-to-face conference. Petitioner was also
informed that if she wished to discuss collection alternatives to
the intended levy, such as an installment agreement or an offer-
in-compromise, she had to (1) submit certain documents to
Settlement Officer Hill, such as Form 433-A, Collection
Information Statement for Wage Earners and Self-Employed
Individuals, (2) file as yet unfiled Federal income tax returns
for 2003, 2004, and 2005, and (3) submit proof that all required
estimated tax payments had been fully paid. Finally, petitioner
was informed that she was not entitled to a section 6330 hearing
regarding the intended levy with respect to tax year 2000 but
that she could have a hearing equivalent to a section 6330
hearing with respect to that matter.
Petitioner faxed a 12-page response to Settlement Officer
Hill. Petitioner raised numerous frivolous arguments including
(1) that she was a resident of a State and not of the United
States and (2) that the Supreme Court in Pollock v. Farmers’ Loan
& Trust Co., 158 U.S. 601 (1895), held that the income tax was
- 5 -
unconstitutional. At trial petitioner disavowed all of the
arguments set forth in her fax.
During the November 15, 2006, telephone hearing, petitioner
continued to assert frivolous arguments. She did not propose any
collection alternatives (i.e., an offer-in-compromise or an
installment agreement). On November 30, 2006, respondent’s
Appeals Office issued a Notice of Determination Concerning
Collection Action(s) Under Section 6320 and/or 6330. In the
notice of determination, respondent sustained the proposed levy
and rejected petitioner’s arguments. An attachment to the notice
of determination (written by Settlement Officer Hill) noted that
petitioner did not offer any collection alternatives, that
Settlement Officer Hill reviewed the administrative file
transcripts and verified that the requirements of all applicable
law and administrative procedures were met, and that the proposed
levy action with respect to the collection of petitioner’s unpaid
Federal income tax for 2001 appropriately balanced the need for
efficient collection of the taxes with the legitimate concerns of
the taxpayer that the collection action be no more intrusive than
necessary.
On January 3, 2007, petitioner filed a petition in this
Court to review respondent’s intended collection action.1
1
Petitioner also requested the Court to review respondent’s
determination to proceed with collection of petitioner’s unpaid
(continued...)
- 6 -
Discussion
A. Standard of Review
This case involves a review of respondent’s determination to
proceed with collection of petitioner’s unpaid Federal income
tax, penalties, and interest for 2001 by way of levy. Section
6330 hearings concerning levies are conducted in accordance with
section 6330(c). After the Commissioner issues his notice of
determination following an administrative hearing, a taxpayer has
the right to petition this Court for judicial review of the
Commissioner’s determination. Sec. 6330(d)(1). Our review of
the Commissioner’s determination is subject to the provisions of
section 6330.
A taxpayer is precluded from contesting the existence or
amount of the underlying tax liability if he/she received a
notice of deficiency for the tax year in question or otherwise
had an opportunity to dispute the underlying tax liability. Sec.
6330(c)(2)(B). In such a case, we review the Commissioner’s
determination for abuse of discretion. See Sego v. Commissioner,
114 T.C. 604, 610 (2000); Goza v. Commissioner, 114 T.C. 176
(2000). An abuse of discretion is defined as any action that is
1
(...continued)
Federal income taxes for 2000 as set forth in respondent’s
decision letter. The Court’s copy of respondent’s decision
letter is undated. By Order dated Apr. 27, 2007, the Court
dismissed tax year 2000 from consideration of this case and
struck all references to that year from the petition.
- 7 -
unreasonable, arbitrary or capricious, clearly unlawful, or
lacking sound basis in fact or law. Thor Power Tool Co. v.
Commissioner, 439 U.S. 522, 532-533 (1979); Woodral v.
Commissioner, 112 T.C. 19, 23 (1999).
Petitioner was issued a notice of deficiency for 2001, which
she received. She did not file a proper petition in this Court
and did not pay the required filing fee. Petitioner was given an
opportunity to file a proper amended petition and pay the
required filing fee, but she failed to do so and her suit at
docket No. 16198-04 was dismissed. Petitioner is therefore not
entitled to raise her underlying tax liability for 2001, and we
review respondent’s proposed collection action for abuse of
discretion.
B. Petitioner’s Request for a Face-to-Face Section 6330 Hearing
Petitioner’s main argument is that her section 6330 hearing
was invalid and unlawful because it was held by way of a
teleconference and not a face-to-face conference.
Although a section 6330 hearing may consist of a face-to-
face conference, a proper hearing may also occur by telephone or
by correspondence under certain circumstances. See Katz v.
Commissioner, 115 T.C. 329, 337-338 (2000); sec. 301.6330-
1(d)(2), Q&A-D6, Proced. & Admin. Regs. Section 6330 hearings
have historically been informal. Davis v. Commissioner, 115 T.C.
35, 41 (2000). We have held that it is not an abuse of
- 8 -
discretion if an Appeals officer denies a taxpayer’s request for
a face-to-face section 6330 hearing after determining that the
hearing would not be productive because of the taxpayer’s
frivolous or groundless arguments. See Summers v. Commissioner,
T.C. Memo. 2006-219; Ho v. Commissioner, T.C. Memo. 2006-41.
Moreover, we have held it is not an abuse of discretion to
proceed with collection where the taxpayer has not filed all
required tax returns for prior years. See Summers v.
Commissioner, supra; Collier v. Commissioner, T.C. Memo. 2004-
171.
The record demonstrates that a face-to-face conference would
not have been productive. Petitioner’s meeting request contained
only arguments challenging the legality of the tax law itself,
arguments that we have long considered frivolous. Respondent
granted petitioner a telephone conference and informed her that
she could still qualify for a face-to-face conference if she
would first identify any relevant nonfrivolous matter she
intended to discuss. Despite being given this second
opportunity, petitioner presented no such matter. Instead,
petitioner replied with arguments regarding how she was not
subject to Federal income tax and that the income tax was
unconstitutional. Furthermore, petitioner did not file her
unfiled income tax returns for 2003-05. Under these
circumstances, it was not an abuse of discretion for Settlement
- 9 -
Officer Hill to conclude that a face-to-face meeting would not
have been productive. Thus, Settlement Officer Hill was not
required to offer petitioner a face-to-face conference. See
Clark v. Commissioner, T.C. Memo. 2008-155; Summers v.
Commissioner, supra; see also Lunsford v. Commissioner, 117 T.C.
183 (2001).
On December 27, 2006, nearly 1 month after respondent issued
the notice of determination, petitioner wrote Settlement Officer
Hill stating: “If any of my correspondence contains frivolous
arguments, I now withdraw them.” Petitioner submitted a new Form
12153 to respondent and requested a face-to-face section 6330
hearing. Petitioner maintains that on the basis of her
submission of this second Form 12153, respondent’s notice of
determination is no longer material and/or relevant.
Consequently, petitioner posits that (1) the notice of
determination, dated November 30, 2006, should be considered
nullified, (2) she be given an opportunity for a face-to-face
section 6330 hearing, and (3) a new notice of determination
should be issued.
Petitioner cannot undo that which has occurred. Her
position change, assuming there truly is a position change, is
too late to alter the disposition of this case. When making his
determination, respondent could only review the existing facts
and those arguments advanced. On the basis of petitioner’s
- 10 -
submissions during the hearing provided by section 6330, we hold
that respondent did not abuse his discretion in (1) refusing to
offer petitioner a face-to-face hearing, and (2) sustaining the
proposed levy collection.
C. Other Matters Petitioner Raised
Petitioner argues that the tax liability respondent
determined for 2001 is grossly overstated, and she requests that
we redetermine the amount she owes. We cannot accede to
petitioner’s request. See sec. 6330(c)(2)(B); see also Sego v.
Commissioner, 114 T.C. at 610. Petitioner received a notice of
deficiency for 2001, and she had an opportunity to contest
respondent’s determination before this Court. Petitioner failed
to properly do so.
We have considered all of petitioner’s arguments and to the
extent not discussed herein, we find them to be groundless and/or
without merit.
To reflect the foregoing,
Decision will be entered
for respondent.