Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-23-01063/USCOURTS-caDC-23-01063-0/pdf.json

Parties Involved:
Blake M. Adams
Appellant
Commissioner of Internal Revenue
Appellee

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Submitted September 5, 2024 Decided December 6, 2024

No. 23-1063

BLAKE M. ADAMS,

APPELLANT

v.

COMMISSIONER OF INTERNAL REVENUE,

APPELLEE

On Appeal from the United States Tax Court

Blake M. Adams, pro se, was on the briefs for appellant.

Michael J. Haungs, Supervisory Attorney, U.S. 

Department of Justice, and Andrew W. Amend, Attorney, were 

on the brief for appellee. Kathleen E. Lyon, Attorney, entered 

an appearance.

Before: PILLARD and GARCIA, Circuit Judges, and 

ROGERS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge PILLARD.

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 1 of 12
2

PILLARD, Circuit Judge: Section 7345 of the Internal 

Revenue Code requires the Secretary of the Treasury to notify 

the Secretary of State if an individual has an IRS-certified

seriously delinquent tax debt. The State Department may then

deny, revoke, or limit that individual’s passport. Anyone

whose tax debt has been certified as seriously delinquent has a 

right to challenge the certification in court. 26 U.S.C. 

§ 7345(e). 

Blake Adams filed no federal income tax return for tax 

years 2007 or 2009-2015. The Internal Revenue Service

calculated that he owed more than $1.2 million in back taxes, 

interest, and penalties for those years. Because of the 

magnitude of Adams’s unpaid and unchallenged tax debt, 

which the IRS was in the process of collecting, the agency 

certified his seriously delinquent tax debt to the State 

Department. After receiving notice that the certification was 

made and transmitted to the State Department, Adams sued the 

IRS in Tax Court under section 7345. He claimed that the IRS 

made procedural errors in assessing his underlying tax debt that 

rendered the certification erroneous. The Tax Court rejected 

that argument, explaining that Adams had forfeited the 

opportunities that the Tax Code affords to contest his 

underlying tax liability. Because the Tax Court correctly 

concluded that Adams’s section 7345 challenge is foreclosed, 

we affirm.

BACKGROUND

A.

Once the IRS determines that a taxpayer has a tax 

deficiency, before it assesses the deficiency it is required to 

mail a notice of deficiency by certified or registered mail and 

wait until the individual’s time to request a redetermination of 

the deficiency in Tax Court has lapsed. 26 U.S.C. §§ 6212(a), 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 2 of 12
3

6213(a). A taxpayer within the United States has 90 days to 

file a Tax Court petition seeking redetermination of the 

deficiency. See id. § 6213(a). After the IRS assesses the tax, 

it is again required to send the taxpayer notice by mail. Id.

§ 6303(a). 

If the taxpayer has not contested the deficiency, the IRS 

moves on to the collection phase by sending him a notice of 

federal tax lien and informing him of his right to a collection 

due process hearing. See id. §§ 6320(a), 6321. In a collection 

due process hearing, the individual can “raise . . . challenges to 

the existence or amount of the underlying tax liability for any 

tax period if [he] did not receive any statutory notice of 

deficiency for such tax liability or did not otherwise have an 

opportunity to dispute such tax liability.” See id. § 6320(c) 

(incorporating id. § 6330(c)(2)(B)). More broadly, a taxpayer 

may raise “any relevant issue relating to the unpaid tax or the 

proposed levy,” including “challenges to the appropriateness of 

collection actions.” See id. § 6320(c) (incorporating id.

§ 6330(c)(2)(A)(ii)). 

Congress enacted section 7345 in 2015 as a mechanism to 

offset spending under the Fixing America’s Surface 

Transportation (FAST) Act by adding incentives for 

individuals with large, delinquent tax debts to pay them without 

further delay. See generally H.R. Rep. No. 114-357, at 530-32 

(2015) (Conf. Rep.) (identifying offsets). Section 7345 defines 

a seriously delinquent tax debt as an “unpaid, legally 

enforceable Federal tax liability of an individual” that meets 

three requirements. 26 U.S.C. § 7345(b)(1). The first

requirement is that the tax debt was “assessed.” Id.

§ 7345(b)(1)(A). Second, the debt must be greater than 

$50,000—a threshold periodically adjusted for inflation. Id.

§§ 7345(b)(1)(B), 7345(f). And, third, the IRS must have 

either (i) filed a notice of lien pursuant to 26 U.S.C. § 6323 and 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 3 of 12
4

waited for the individual’s administrative rights under 26 

U.S.C. § 6320 to be exhausted or lapse or (ii) made a levy on 

the individual’s income or other property under 26 U.S.C. 

§ 6331. Id. § 7345(b)(1)(C). (Liens and levies are part of the 

IRS’ collection authority: A federal tax lien is the 

government’s legal claim against an individual’s property 

when they fail to pay a tax debt. See id. § 6321. A levy is the 

seizure of the individual’s property to satisfy a tax debt. See 

id. § 6331(b)). 

The statute recognizes two circumstances under which, 

even if the three criteria are met, a tax debt is not seriously 

delinquent: where the debt is being paid in a timely manner 

under an agreement with the IRS, or where collection of the 

debt is suspended because the individual has requested a 

collection due process hearing or is pursuing relief from joint 

liability. Id. § 7345(b)(2). The IRS Commissioner must notify 

the Secretary of the Treasury, who must in turn notify the 

Secretary of State, if the certification is erroneous; the debtor 

fully satisfies the tax debt; the debtor agrees to an installment 

agreement or offer-in-compromise; or the debtor qualifies for 

innocent spouse relief. Id. § 7345(c) (Reversal of 

Certification). 

Once the IRS determines that an individual has a seriously 

delinquent tax debt, it notifies the Treasury Secretary, who

“shall” in turn transmit the certification to the Secretary of State 

“for action with respect to denial, revocation, or limitation” of 

the individual’s passport. Id. § 7345(a). That person may bring 

a civil action in district court or in Tax Court to challenge the 

seriously delinquent tax debt certification as erroneous or on 

the ground that the IRS Commissioner failed to reverse the 

certification when required. Id. § 7345(e)(1). If the court rules 

in the tax debtor’s favor, it “may order the Secretary [of the 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 4 of 12
5

Treasury] to notify the Secretary of State that such certification 

was erroneous.” Id. § 7345(e)(2). 

B.

As noted above, Blake Adams failed to file federal income 

tax returns for 2007 and 2009-2015. Adams asserts that the 

IRS never mailed him deficiency notices for the relevant years. 

But Adams did not file the requisite petition in Tax Court 

within the allotted 90-day period to challenge the deficiencies, 

so the IRS proceeded to assess them. Adams claims that he 

never received notice of those assessments either.

The IRS then sought to collect. For tax years 2007 and 

2009-2011, the IRS in August 2015 filed notices of lien and 

notified Adams of his right to a collection due process hearing. 

A year later, in August 2016, the IRS filed notices of lien and 

notified Adams of his collection due process rightsfor tax years 

2012 and 2013. For the 2014 tax year, the IRS filed the notice 

of lien and notified Adams of his collection due process rights

in August 2019, and for the 2015 tax year it did so in December 

2019. Adams acknowledges that, after receiving those notices, 

he did not request any collection due process hearing. See 

Adams Br. 4. 

The IRS also issued notices of intent to levy against 

Adams. For tax years 2007 and 2009-2011, it issued a notice 

of intent to levy in March 2016. For tax years 2012-2014, it 

did so in August 2019. For the 2015 tax year, it did so in 

December 2019. It is uncontested that those notices also 

informed Adams about his right to a collection due process 

hearing. He never requested one. The IRS proceeded to issue 

those levies between 2017 and 2020, recovering approximately 

$26,700. That left Adams with more than $1.1 million in 

outstanding liabilities. 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 5 of 12
6

On March 16, 2020, the IRS certified the seriously 

delinquent tax debt to the State Department. The record 

reflects that the IRS had previously certified that Adams owed 

a seriously delinquent tax debt for the 2007 and 2009-2013 tax 

years on July 30, 2018. See Tax Court Record 50, 53, 56, 59, 

62, 65. It issued another certification covering the 2007 and 

2009-2014 tax years on November 18, 2019. See Tax Court 

Record 50, 53, 56, 59, 62, 65, 68. Adams never challenged the 

two earlier certifications. 

On December 3, 2020, Adams filed a petition in Tax Court 

challenging the 2020 certification of seriously delinquent tax 

debt under section 7345. Adams rested his petition on five 

grounds. He argued that: (1) the IRS never sent him “any 

documents by 1st class or certified mail explaining what these 

taxes are based on”; (2) the IRS never sent him “any letter, 

giving [him] due process & opportunity to challenge the tax for 

years ‘07, ‘09-‘15”; (3) the $1.2 million figure he owes to the 

IRS is “completely baseless, arbitrary, [and] lacking any 

foundation of fact”; (4) the IRS “did not perform all the legally 

required procedures necessary to assess the tax which IRS 

claims [he] owes;” and (5) the certification was an 

“unconstitutional taking away” of his right to travel. Tax Court 

Pet. 1 (J.A. 5) (formatting altered).

The Tax Court granted summary judgment in the 

government’s favor. Adams v. Comm’r, 160 T.C. 1, 18 (2023). 

To the extent that Adams was asserting that the IRS’

calculation of his tax debt was incorrect, the court held that it 

lacked jurisdiction to review the tax liabilities underlying the 

certification. Id. at 10-13. The Tax Court concluded that, even 

if the IRS had failed to mail the required notices during its 

collection actions, the certification was not “erroneous” under 

section 7345. Id. at 13-15. The Tax Court held that it lacked 

jurisdiction to review the Secretary of State’s discretionary 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 6 of 12
7

determination, on receipt of a seriously delinquent tax debt 

certification, to revoke, deny, or limit the taxpayer’s passport. 

Id. at 16. The Tax Court concluded that it did not have 

jurisdiction to review Adams’s constitutional right-to-travel 

claim. Id. at 17-18. Adams timely appealed. 

The Tax Court initially transmitted the notice of appeal to 

the Court of Appeals for the Eleventh Circuit. The Tax Court 

later transmitted an amended notice to this court, which 

ultimately docketed the case. In short order, Adams moved to 

transfer venue to the Eleventh Circuit. We deferred decision

on that motion to consider it with the merits of Adams’s

petition. We review the Tax Court’s legal rulings de novo. 

Byers v. Comm’r, 740 F.3d 668, 674-75 (D.C. Cir. 2014). 

Because Adams does not raise the constitutional claim on 

appeal, we do not consider it. 

DISCUSSION

This court is the correct venue for Adams’s section 7345 

challenge. Adams’s arguments fail on the merits: The Tax 

Court correctly held that every element of section 7345(b)(1), 

defining seriously delinquent tax debt, was satisfied. Adams’s

belated effort to use a section 7345 passport action to challenge 

his underlying tax liability is foreclosed because Adams 

forewent opportunities to timely challenge that liability in 

collection due process hearings. 

A.

Before proceeding to the merits, we conclude that venue is 

proper here and not, as Adams contends, in the Eleventh 

Circuit. The D.C. Circuit is the default venue for appeals of 

Tax Court decisions. See 26 U.S.C. § 7482(b)(1); Byers, 740 

F.3d at 672. Section 7482 lists seven circumstances in which 

venue may lie elsewhere, 26 U.S.C. §§ 7482(b)(1)(A)-(G), but 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 7 of 12
8

review of a Tax Court decision on a challenge to certification 

of a seriously delinquent tax debt is not one of them, see id.

Adams, a Florida resident, argues that venue lies in the 

Eleventh Circuit because appeals of cases in which an 

individual is “seeking redetermination of tax liability” are 

reviewable in the circuit where the individual lives. See id.

§ 7482(b)(1)(A). But Adams’s reliance on that provision is 

misplaced. Adams petitioned the Tax Court for recission of the 

seriously delinquent tax debt certification. The only relief 

available if such a petition succeeds is an order holding that the 

certification is erroneous, pursuant to which the Secretary of 

the Treasury would have to inform the Secretary of State of the 

error. Although Adams’s petition asserts that his underlying 

tax liability was imposed in error, he did not petition for 

“redetermination” of tax liability nor, in this posture, could he. 

We cannot construe his petition as “seeking” legal relief that is 

unavailable in this action. That means section 7482(b)(1)(A), 

providing for venue of a redetermination appeal where the 

taxpayer lives, is inapplicable here.

Adams’s motion to transfer venue is therefore denied.

B.

Adams’s merits arguments are also unsuccessful. The text 

of section 7345, read in context with other provisions of the 

Internal Revenue Code, resolves this appeal. The seriously 

delinquent tax debt certification was correct. 

Section 7345(e) provides for injunctive relief from an 

erroneous seriously delinquent tax debt certification or one that 

the IRS should have but failed to reverse. See 26 U.S.C. 

§ 7345(e)(1). Adams’s only argument for relief is that the 

certification itself is erroneous; he does not contend that any of 

the other grounds for reversal apply. See id. § 7345(c). Section 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 8 of 12
9

7345 does not further define when a certification may be 

“found to be erroneous,” but is most naturally read to apply 

when any of the elements defining “seriously delinquent tax 

debt” is not satisfied or when one of the two statutory 

exceptions set out in section 7345(b)(2) applies. 

Here, the Tax Court determined that each of the 

definitional elements of a seriously delinquent tax debt was 

satisfied. Adams’s tax liability “has been assessed” in an 

amount “greater than” the adjusted minimum threshold amount 

of $53,000, and a “notice of lien has been filed,” as to which 

Adams’s “administrative rights under section 6320” have 

lapsed. Adams, 160 T.C. at 4, 8. Adams has not claimed that

either of the statutory exceptions applies—i.e., he does not 

assert that he is paying his tax debt under an agreement with 

the IRS, or that collection was suspended pending a collection 

due process hearing or a petition for relief from joint liability.

Adams’s primary contention on appeal is that section 

7345(b)(1)(A) requires not just that the IRS have “assessed” 

the tax, but that it did so “properly.” Adams Mot. Summ. J. 5 

(J.A. 15). Specifically, Adams contends that the IRS failed to 

serve him notice of each deficiency and assessment in the 

statutorily prescribed manner. In his view, that means the 

assessments were illegal and so cannot support the certification 

of a seriously delinquent tax debt. 

The Internal Revenue Code forecloses this argument. 

Under the Code, assessment means “recording the liability of 

the taxpayer in the office of the Secretary [of the Treasury] in 

accordance with rules or regulations prescribed by the 

Secretary.” 26 U.S.C. § 6203. As the Supreme Court has 

explained, “the assessment is the official recording of liability 

that triggers levy and collection efforts.” Hibbs v. Winn, 542 

U.S. 88, 101 (2004). The assessment itself is “essentially a 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 9 of 12
10

bookkeeping notation.” Id. at 100 (quoting Laing v. United 

States, 423 U.S. 161, 170 n.13 (1976) (internal quotations 

omitted)). As the Tax Court noted, there is no dispute that the 

IRS recorded the liabilities at issue here. Adams, 160 T.C. at 

13. 

To be sure, the Code also provides that “no assessment of 

a deficiency . . . shall be made, begun, or prosecuted” until the 

IRS has mailed the taxpayer a notice of deficiency and the 90-

day period to file a Tax Court petition for redetermination of 

the deficiency has run. See 26 U.S.C. § 6213(a). And “it is the 

assessment, and only the assessment, that sets in motion the 

collection powers of the IRS, powers that include the seizure 

of assets, the freezing of bank accounts and the creation of 

liens, all without judicial process.” Farhy v. Comm’r, 100 

F.4th 223, 226 (D.C. Cir. 2024) (quoting Phila. & Reading 

Corp. v. United States, 944 F.2d 1063, 1064 n.1 (3d Cir. 1991)

(formatting altered)).

But Adams did not timely use the opportunities the Tax 

Code made available to him to challenge any lack of notice of 

deficiencies. A tax debt is “seriously delinquent” only once the 

IRS has also filed a notice of lien and “the administrative rights 

under section 6320 with respect to such filing have been 

exhausted or have lapsed” or “a levy is made pursuant to 

section 6331.” 26 U.S.C. § 7345(b)(1)(C). Section 6331 

requires that the IRS give an individual written notice at least 

30 days before any levy and include language notifying the 

taxpayer of “the administrative appeals available to the 

taxpayer with respect to such levy and sale and the procedures 

relating to such appeals.” Id. §§ 6331(d)(2), (d)(4). Adams 

acknowledges that he received notice of the filing of tax liens 

for the years in question. The record shows that he also 

received notices of intent to levy for those years. The notices 

of lien and intent to levy informed Adams of his right to 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 10 of 12
11

collection due process hearings at which he could have 

objected to the missing deficiency and assessment notices and 

contested his underlying tax liabilities. He forfeited those 

opportunities. 

In his briefs on appeal, Adams seeks additional footing for 

his claim: He argues for the first time that, because the IRS 

cannot enforce a procedurally defective assessment, the 

assessments fall short of section 7345(b)(1)’s requirement that 

a “seriously delinquent tax debt” be “legally enforceable.” 

Adams Br. 10; Reply Br. 3. Because Adams did not make that 

argument in the Tax Court, which accordingly did not address 

the meaning of “legally enforceable” in this context, we do not 

address it here.

We hold that, because each of the definitional elements set 

forth in section 7345(b)(1) was satisfied, the certification of 

Adams’s seriously delinquent tax debt was not “erroneous”

within the meaning of section 7345(c).

To recap, the Treasury Secretary may only transmit a 

delinquency certification to the State Department after an 

individual has had the opportunity to exercise administrative 

rights to challenge an IRS lien or levy. It is uncontested that 

the IRS served Adams with notice of its collection actions and 

his administrative rights over multiple years. Adams took no 

action to timely contest the tax liens or underlying deficiency 

determinations. Only much later, after his passport was in 

jeopardy, did he attempt to dispute the IRS collection and 

enforcement actions. Section 7345 plainly forecloses such an 

eleventh-hour collateral attack on a person’s underlying tax 

liabilities. 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 11 of 12
12

For the foregoing reasons, we affirm the judgment of the 

Tax Court.

So ordered. 

USCA Case #23-1063 Document #2088307 Filed: 12/06/2024 Page 12 of 12