T.C. Memo. 2012-234
UNITED STATES TAX COURT
EDWARD E. CURRAN, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 967-11L. Filed August 13, 2012.
George J. Smith, for petitioner.
Cindy Shin Young Park, for respondent.
MEMORANDUM OPINION
RUWE, Judge: This matter is before the Court on respondent’s motion for
summary judgment (motion) pursuant to Rule 121.1 Respondent contends that no
1
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.
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[*2] genuine issue exists as to any material fact and that the determination to collect
petitioner’s income tax liability by levy should be upheld. Petitioner has not
responded to the motion, despite an order from this Court instructing him to do so.2
Background
At the time the petition was filed, petitioner resided in New Jersey.
Petitioner filed a Federal income tax return for 2008 but failed to pay the
liability reported on the return. As a result, respondent assessed the tax shown on
the return.
Respondent sent petitioner a Letter 1058, Final Notice of Intent to Levy and
Notice of Your Right to a Hearing, dated March 22, 2010, advising him that
respondent intended to levy to collect the unpaid tax liability, interest, and penalty
and that he could request a hearing with respondent’s Office of Appeals.
Petitioner submitted a timely Form 12153, Request for a Collection Due Process
or Equivalent Hearing, in which he did not contest the underlying liability but
instead requested an installment agreement. By letter dated August 2, 2010,
2
On December 7, 2011, the Court ordered petitioner to file a response on or
before December 29, 2011. No response was filed by petitioner. By order dated
January 11, 2012, the Court extended the time for filing petitioner’s response until
February 1, 2012. Petitioner did not file a response.
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[*3] respondent’s settlement officer acknowledged receipt of petitioner’s collection
due process (CDP) hearing request and scheduled a telephone conference. In the
letter the settlement officer requested that petitioner provide a completed Form 433-
A, Collection Information Statement for Wage Earners and Self-Employed
Individuals, and Form 433-B, Collection Information Statement for Businesses, so
that she could make a decision regarding petitioner’s request for an installment
agreement.
During the telephone conference on November 1, 2010, George J. Smith,
petitioner’s representative, requested petitioner’s account be placed in currently not
collectible (CNC) status because petitioner could not pay the debt at that time.
Additionally, petitioner’s representative claimed that petitioner had sold a property
at a loss in 2010. Petitioner’s representative stated that petitioner intended to carry
back the loss to 2008 and that the carryback would reduce the 2008 tax liability to
zero.
On November 16, 2010, the settlement officer informed petitioner’s
representative that her review of Forms 433-A and B indicated that petitioner owned
property that could be sold to pay off his tax liability. The settlement officer told
petitioner’s representative that she could offer a 120-day extension for petitioner to
submit the loss carryback paperwork to resolve the 2008 tax liability.
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[*4] The settlement officer informed petitioner’s representative that she would issue
a notice of determination if she did not hear back from him by November 19, 2010.
Petitioner’s representative did not contact the settlement officer after the November
16, 2010, telephone conference.
Respondent issued petitioner a Notice of Determination Concerning
Collection Action(s) Under Section 6320 and/or 6330, dated December 10, 2010,
sustaining the levy action. On January 11, 2011, petitioner timely filed a petition
with this Court, stating generally that he disagreed with the proposed collection
action because it would create an economic hardship and that he did not currently
have the ability to pay the liability or enter into an installment payment agreement.
The Form 4340, Certificate of Assessments, Payments, and Other Specified
Matters, attached to respondent’s motion shows that an abatement of $176,943 was
posted to petitioner’s account on May 16, 2011, resulting from a tentative carryback
claim. Despite the abatement, petitioner still had an outstanding balance due of
$58,895.88 as of December 1, 2011.
Discussion
Summary judgment is intended to expedite litigation and to avoid
unnecessary and expensive trials. Shiosaki v. Commissioner, 61 T.C. 861, 862
(1974). Summary judgment may be granted where the pleadings and other
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[*5] materials show that there is no genuine dispute as to any material fact and that
a decision may be rendered as a matter of law. Rule 121(a); see Schlosser v.
Commissioner, T.C. Memo. 2007-298, 2007 Tax Ct. Memo LEXIS 300, at *6,
aff’d, 287 Fed. Appx. 169 (3d Cir. 2008). The burden is on the moving party to
demonstrate that no genuine dispute as to any material fact remains and that he is
entitled to judgment as a matter of law. FPL Grp., Inc. & Subs. v. Commissioner,
116 T.C. 73, 74-75 (2001). In all cases, the evidence is viewed in the light most
favorable to the nonmoving party. Bond v. Commissioner, 100 T.C. 32, 36
(1993). However, the nonmoving party is required “to go beyond the pleadings
and by * * * [his] own affidavits, or by the ‘depositions, answers to
interrogatories, and admissions on file,’ designate ‘specific facts showing that
there is a genuine issue for trial.’” Celotex Corp. v. Catrett, 477 U.S. 317, 324
(1986); see also Rauenhorst v. Commissioner, 119 T.C. 157, 175 (2002); FPL
Grp., Inc. & Subs. v. Commissioner, 115 T.C. 554, 559 (2000). Petitioner failed
to respond to the motion and has failed to demonstrate that there is a genuine
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[*6] dispute for trial.3 Consequently, we conclude that there is no dispute as to any
material fact and that a decision may be rendered as a matter of law.
Section 6331(a) provides that if any person liable to pay any tax neglects or
refuses to pay such tax within 10 days after notice and demand for payment, then
the Secretary is authorized to collect such tax by levy upon the person’s property.
Section 6331(d) provides that, at least 30 days before enforcing collection by way of
a levy on the person’s property, the Secretary is obliged to provide the person with a
final notice of intent to levy, including notice of the administrative appeals available
to the person (Appeals hearing). If a taxpayer requests an Appeals hearing, he may
raise at that hearing any relevant issue relating to the unpaid tax or proposed levy.
Sec. 6330(c)(2). Relevant issues include possible alternative means of collection
such as an installment agreement. Sec. 6330(c)(2)(A)(iii).
If a taxpayer’s underlying liability is properly at issue, the Court reviews
any determination regarding the underlying liability de novo. Goza v.
Commissioner, 114 T.C. 176, 181-182 (2000). Petitioner has the burden of proof
regarding his underlying liability. See Rule 142(a). A taxpayer is precluded from
3
By failing to respond to the assertions in the motion, petitioner has waived
his right to contest them. See Rule 121(d); Lunsford v. Commissioner, 117 T.C.
183, 187 (2001); Akonji v. Commissioner, T.C. Memo. 2012-56, 2012 Tax Ct.
Memo LEXIS 49, at *6.
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[*7] disputing the underlying liability if it was not properly raised in the CDP
hearing. See Giamelli v. Commissioner, 129 T.C. 107, 114 (2007). Petitioner did
not raise his underlying tax liability in his request for a CDP hearing. In his petition
he made no specific allegations or arguments regarding the correctness of the
underlying tax liability, and he failed to file any response to respondent’s motion for
summary judgment. Consequently, petitioner’s underlying tax liability is not
properly before the Court.
The Court reviews administrative determinations by the Commissioner’s
Office of Appeals regarding nonliability issues for abuse of discretion. Hoyle v.
Commissioner, 131 T.C. 197, 200 (2008); Goza v. Commissioner, 114 T.C. at 182.
The determination of the Office of Appeals must take into consideration: (1) the
verification that the requirements of applicable law and administrative procedure
have been met; (2) issues raised by the taxpayer; and (3) whether 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. Sec. 6330(c)(3); see Lunsford v. Commissioner, 117 T.C. 183, 184
(2001). We note that the settlement officer properly based her determination on the
factors required by section 6330(c)(3).
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[*8] In the CDP hearing request petitioner requested an installment agreement as
an alternative means of collection. In the Appeals hearing, petitioner’s
representative requested that petitioner’s liability be placed in CNC status.
Respondent contends that the settlement officer did not abuse her discretion by
denying petitioner’s requests for an installment agreement and to place his tax
liability in CNC status because petitioner had sufficient assets to pay his tax
liability.
Petitioner’s Forms 433-A and B show he had sufficient assets to pay off his
tax liability. Generally, it is not an abuse of discretion for the settlement officer to
deny a taxpayer’s requests for an installment agreement or for the liability to be
placed in CNC status when the taxpayer has sufficient assets to pay his tax
liability. See Foley v. Commissioner, T.C. Memo. 2007-242, 2007 Tax Ct. Memo
LEXIS 245, at *4-6; Castillo v. Commissioner, T.C. Memo. 2004-238, 2004 Tax
Ct. Memo LEXIS 247, at *8; see also Internal Revenue Manual pt. 5.14.1.4(5)
(June 1, 2010) (“Taxpayers do not qualify for installment agreements if balance
due accounts can be fully or partially satisfied by liquidating assets”.). Therefore,
we find that the settlement officer did not abuse her discretion in denying
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[*9] petitioner’s requests for an installment agreement and to place the liability in
CNC status.4
In the petition, petitioner argues that sustaining the levy would create an
economic hardship for him. Petitioner has not demonstrated that the levy would
create an unwarranted economic hardship that would be sufficient to find that the
settlement officer abused her discretion.
We hold that the determination to proceed with collection was not an abuse
of the settlement officer’s discretion, and the proposed collection action is sustained.
To reflect the foregoing,
An appropriate order will be
issued granting respondent’s motion,
and decision will be entered for
respondent.
4
Indeed petitioner seems to have abandoned the installment agreement
argument. In his petition, petitioner states: “The taxpayer does not currently have
the ability to enter in to an installment payment arrangement.”