T.C. Memo. 2009-188
UNITED STATES TAX COURT
BARNABAS E. WILLIAMSON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 23893-07L. Filed August 19, 2009.
Barnabas E. Williamson, pro se.
Randall L. Eager, for respondent.
MEMORANDUM FINDINGS OF FACT 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 tax liability for 2003 by way of levy. The issue
involved is whether respondent abused his discretion in denying
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petitioner a face-to-face hearing. Unless otherwise indicated,
all section references are to the Internal Revenue Code.
FINDINGS OF FACT
Some of the facts have been stipulated. The stipulated
facts and the accompanying exhibits are incorporated herein by
this reference. At the time he filed his petition, petitioner
resided in North Carolina.
Petitioner failed to file a Federal income tax return for
2003. Respondent prepared a substitute for return pursuant to
his authority under section 6020(b). On May 10, 2005, a notice
of deficiency was mailed to petitioner.1 Petitioner did not file
a petition in this Court contesting respondent’s determinations.
Therefore, on October 17, 2005, respondent assessed the tax and
related additions to tax determined in the notice of deficiency,
as well as associated interest. On the same day that the
assessment was made, respondent sent petitioner a notice and
demand for payment of the deficiency and associated interest.
On April 11, 2007, respondent sent petitioner notice of his
intent to levy on petitioner’s assets to collect petitioner’s
unpaid tax liability for 2003. In response, petitioner timely
filed a Form 12153, Request for a Collection Due Process or
1
Although the record does not specifically reveal that
petitioner received the notice of deficiency, petitioner does not
assert otherwise or that the notice of deficiency was not
properly and timely issued.
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Equivalent Hearing (section 6330 hearing). Attached to
petitioner’s request was a form used by individuals adhering to
principles espoused by the Patriot Network, a national
organization that advocates tax avoidance activities as well as
the frustration and delay of collection efforts by the Internal
Revenue Service (IRS). That form contained a laundry list of
requests, including a request for a face-to-face hearing. In
addition, the form listed potential defects in IRS procedures and
also listed arguments and requests that a taxpayer might make in
a collection proceeding context. Petitioner placed an “X” in the
blank by each item even though some of them are manifestly
incorrect with respect to him.
The case was assigned to Settlement Officer James M. Payton
of the IRS’s Appeals Office. On July 26, 2007, Settlement
Officer Payton sent petitioner a letter scheduling a telephone
section 6330 hearing for August 20, 2007, at 10 a.m. eastern
daylight time. The letter informed petitioner that the issues he
raised “are those that Courts have determined are frivolous or
Appeals does not consider.” Further, the letter advised
petitioner that because he raised only frivolous issues, he was
not entitled to a face-to-face hearing. Petitioner was informed
that he would be allowed a face-to-face conference with respect
to any nonfrivolous issue, provided he advised respondent of the
nonfrivolous issue in writing or by telephoning Settlement
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Officer Payton within 14 days from the date of the letter.
Petitioner was further informed that if he wished to discuss
alternatives to the intended levy, such as an installment
agreement or an offer-in-compromise, he had to submit a completed
Form 433-A, Collection Information Statement for Wage Earners and
Self-Employed Individuals, to Settlement Officer Payton within 14
days from the date of the letter.
Petitioner did not respond to Settlement Officer Payton’s
letter. Nor did he call Settlement Officer Payton on the
scheduled date and time. Nevertheless, Settlement Officer Payton
sent petitioner another letter on August 21, 2007, stating:
“Even though you missed your scheduled telephone conference, I am
giving you another opportunity to provide me any additional
information you want me to consider prior to closing your
Collection Due process case on 09/10/2007.”
A Form 433-A was attached to the letter for petitioner to
complete if he wanted to pursue an alternative to the proposed
levy.
On September 4, 2007, Settlement Officer Payton sent a third
letter to petitioner to which was attached a Form 4340,
Certificate of Assessments, Payments, and Other Specified
Matters, for petitioner’s 2003 Federal income tax.
Petitioner responded to this letter on September 6, 2007,
stating: “The Law (IRC 6330) has no provision for a telephone
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conference. I have met the criteria for a face to face
conference. I’m entitled to a face to face CDPH. Please
schedule one for me.”
Settlement Officer Payton did not grant petitioner a face-
to-face hearing. On September 19, 2007, the Appeals Office
issued a Notice of Determination Concerning Collection Action(s)
Under Section 6320 and/or 6330, sustaining the proposed levy and
rejecting all of petitioner’s arguments. An attachment to the
notice of determination, written by Settlement Officer Payton,
noted that (1) petitioner did not offer any collection
alternatives, (2) Settlement Officer Payton reviewed the
administrative file transcripts and verified that the
requirements of all applicable law and administrative procedure
were met, and (3) the proposed levy action with respect to the
collection of petitioner’s unpaid Federal income tax for 2003
appropriately balanced the need for efficient collection of tax
with petitioner’s legitimate concerns that the collection action
be no more intrusive than necessary.
On October 16, 2007, petitioner filed a petition in this
Court challenging respondent’s intended collection action. At
trial petitioner advanced several unfocused and incongruous
lines of argument. Petitioner then proceeded to challenge the
credentials of respondent’s counsel and catechize the Court.
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MR. WILLIAMSON: And I would like to state for fact, I want
to see the certified copy of a power of attorney of him
[respondent’s counsel] to be in this court right now.
THE COURT: I don’t think he needs one, sir.
MR. WILLIAMSON: Well, I do.
THE COURT: Okay. Unfortunately I–-
MR. WILLIAMSON: I’m the secured party creditor, Your Honor.
THE COURT: Okay.
MR. WILLIAMSON: So if there’s anybody else that has a claim
against me under UCC laws, I’m the first priority. So
unless the Government has a claim against me, I want to see
it. Do you [the Court] have a claim against me?
THE COURT: Mr. Williamson, I don’t think we’re going to
answer your questions. All I can say is I think your
assertions do not have legal merit. This is not a case
involving the UCC.
MR. WILLIAMSON: Well, Your Honor, aren’t we under public
policy?
THE COURT: Pardon?
MR. WILLIAMSON: Aren’t we under the public policy?
THE COURT: Again, I’m not going to answer any questions.
You will hear my result in my opinion.
MR. WILLIAMSON: Okay, Your Honor. I should say we are
under public policy. And you hold my remedy.
THE COURT: I hear you.
OPINION
A. Standard of Review
This case involves a review of respondent’s determination to
proceed with collection of petitioner’s unpaid Federal income
tax, additions to tax, and interest for 2003 by way of levy.
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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 determination. Sec. 6330(d)(1). Our review of the
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
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 2003 and
does not dispute that he received it, but he did not file a
petition with this Court. Petitioner is therefore not entitled
to raise his underlying tax liability for 2003 in this
proceeding, and we review respondent’s determination to proceed
with the proposed collection action for abuse of discretion.
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B. Petitioner’s Request for a Face-to-Face Section 6330 Hearing
Petitioner asserts that his section 6330 hearing was invalid
and unlawful because it was scheduled to be held by way of a
telephone conference and not by way of 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
discretion if an Appeals settlement officer denies a taxpayer’s
request for a face-to-face section 6330 hearing after determining
that the hearing would not be productive on account of the
taxpayer’s frivolous or groundless arguments. See Huntress v.
Commissioner, T.C. Memo. 2009-161; Summers v. Commissioner, T.C.
Memo. 2006-219; Ho v. Commissioner, T.C. Memo. 2006-41.
The record demonstrates that a face-to-face conference would
not have been productive. Petitioner’s meeting request contained
general and nonspecific arguments, many of which do not even
apply to petitioner’s circumstances (e.g., arguments with respect
to a nonexistent notice of Federal tax lien, bankruptcy, and
spousal defenses). The settlement officer granted petitioner a
telephone conference and informed him that he could still qualify
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for a face-to-face conference if he would first identify a
relevant nonfrivolous issue he intended to discuss. Despite
being given this opportunity, petitioner presented no such
matter. Even after petitioner failed to call Settlement Officer
Payton at the appointed time for his conference call, the
settlement officer gave petitioner another opportunity to qualify
for a face-to-face meeting by mailing petitioner a letter,
including Form 433-A, asking petitioner to propose a collection
alternative. Petitioner’s only response was a letter stating
that he met all the criteria for a face-to-face meeting. Under
these circumstances, it was not an abuse of discretion for
Settlement Officer Payton to conclude that a face-to-face meeting
would not be productive. Hence, Settlement Officer Payton was
not required to offer petitioner a face-to-face conference. See
Clark v. Commissioner, T.C. Memo. 2008-155; Summers v.
Commissioner, T.C. Memo. 2006-219; see also Lunsford v.
Commissioner, 117 T.C. 183 (2001).
C. Conclusion
Section 6330(c)(3) provides that an Appeals settlement
officer must take into consideration the verification that the
requirements of applicable law and administrative procedure have
been met and whether any proposed collection action balances the
need for the efficient collection of taxes with the legitimate
concern of the taxpayer that any collection action be no more
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intrusive than necessary. The notice of determination states,
and petitioner does not dispute, that Settlement Officer Payton
verified that the requirements of all applicable law and
administrative procedure were met and that the proposed levy
action appropriately balanced the need for efficient collection
of taxes with petitioner’s concerns that the levy be no more
intrusive than necessary. Consequently, we are satisfied that
the mandate of section 6330(c)(3) has been met.
At trial respondent’s counsel requested that the Court
impose a penalty under section 6673(a)(1) on account of
petitioner’s frivolous arguments during trial. Section
6673(a)(1) authorizes the Court to require a taxpayer to pay a
penalty to the United States in an amount not to exceed $25,000
whenever it appears to the Court that the taxpayer instituted or
maintained the proceeding primarily for delay or that the
taxpayer’s position in the proceeding is frivolous or groundless.
Petitioner’s position is frivolous and groundless.
Petitioner failed to advance any argument with respect to
respondent’s proposed collection action. During trial he
continually cited the Uniform Commercial Code, a work that is not
relevant to this case; he challenged respondent’s counsel’s
credentials; he questioned the Court and was unresponsive to the
Court’s most basic questions, such as where his current residence
is. Moreover, we find that petitioner filed his petition for
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purposes of delay. Therefore, pursuant to the authority granted
to the Court under section 6673(a)(1), we require petitioner to
pay to the United States a penalty of $3,000.
We have considered all of petitioner’s assertions, and to
the extent not discussed herein, we find them to be groundless,
irrelevant, and/or without merit.
To reflect the foregoing,
An appropriate order and
decision will be entered.