1Unless otherwise indicated, all section references are to

the Internal Revenue Code currently in effect.

T.C. Memo. 2003-319

UNITED STATES TAX COURT

EDWIN E. AND BERTALINA ALVAREZ, Petitioners v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 13286-02L. Filed November 18, 2003.

Edwin E. Alvarez and Bertalina Alvarez, pro sese.

Irene Scott Carroll, for respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

GOEKE, Judge: The petition in this case was filed under

section 6330(d)1 in response to a Notice of Determination

Concerning Collection Action(s) Under Section 6320 and/or 6330

(the notice of determination). The issue for decision is whether
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the filing of a notice of federal tax lien (NFTL) was

appropriate.

FINDINGS OF FACT

Some of the facts have been stipulated and are so found. 

The stipulation of facts and the attached exhibits are

incorporated herein by this reference. Petitioners resided in

Bell Gardens, California, at the time their petition was filed.

On August 18, 1999, respondent issued a notice of deficiency

to petitioners determining a deficiency in Federal income tax and

an accuracy-related penalty for the taxable year 1996. 

Petitioners filed a petition with this Court in response to the

notice of deficiency. However, petitioners’ case was ultimately

dismissed by the Court for lack of jurisdiction on the ground

that the petition was not timely filed. Petitioners’ 1998 return

was also audited, but they consented to the assessment of a tax

deficiency for that year.

On December 12, 2001, respondent sent to petitioners a

Notice of Federal Tax Lien Filing and Your Right to a Hearing

Under IRC 6320 for their taxable years 1996 and 1998. On January

18, 2002, petitioners requested a section 6330 hearing, stating

that they objected to the filed NFTL because “they never received

an audit notice[,] * * * did not receive a notice of deficiency

and would like an opportunity to dispute the tax liability.” 
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On July 15, 2002, the Appeals Office issued the notice of

determination. The notice states that a hearing was held but

that the only challenge was to the existence or amount of the tax

liability for 1996. The Appeals officer ultimately determined

that the filing of the NFTL was appropriate.

OPINION

Under sections 6320 and 6330, a taxpayer is entitled to

notice and an opportunity for a hearing after an NFTL is filed by

the Commissioner in the process of collecting unpaid Federal

taxes. Section 6330(c)(2) designates the issues that the

taxpayer may raise at the Appeals hearing. In lien actions, the

taxpayer is allowed to raise any relevant issue relating to the

unpaid tax, including spousal defenses, challenges to the

appropriateness of the NFTL filing, and alternatives to

collection. Sec. 6330(c)(2)(A); sec. 301.6320-1(e)(1), Proced. &

Admin. Regs. The taxpayer “may also raise at the hearing

challenges to the existence or amount of the underlying tax

liability” if the taxpayer did not receive a notice of deficiency

or did not otherwise have an opportunity to dispute the tax

liability. Sec. 6330(c)(2)(B); sec. 301.6320-1(e)(1), Proced. &

Admin. Regs.

Where the existence or amount of the underlying tax

liability is properly at issue in the hearing, we review the

matter de novo. Sego v. Commissioner, 114 T.C. 604, 610 (2000);
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Goza v. Commissioner, 114 T.C. 176, 181-182 (2000). Where the

existence or amount of underlying tax liability is not properly

at issue, we review the determination for abuse of discretion. 

Sego v. Commissioner, supra at 610; Goza v. Commissioner, supra

at 181-182.

With respect to tax year 1996, petitioners received a notice

of deficiency as reflected by the fact that they attached the

first page of that notice to their prior petition to this Court. 

Accordingly, petitioners are not entitled to challenge their

underlying tax liability for 1996. Petitioners consented to the

assessment of their 1998 tax and are not challenging their

underlying liability for that year. Therefore, we review the

Appeals officer’s determination for abuse of discretion.

The notice of determination states that the only challenge

at the hearing was to the existence or amount of the 1996 tax

liability. At trial, petitioners did not dispute this statement,

and no collection alternatives, challenges to the appropriateness

of the NFTL filing, or spousal defenses were raised at the

hearing or at the trial. Accordingly, we hold that the Appeals

officer’s determination that the filing of the NFTL was

appropriate was not an abuse of discretion. 

Decision will be entered

for respondent.