1 All section references are to the Internal Revenue Code in

effect for the period during which respondent has pursued

collection, and all Rule references are to the Tax Court Rules of

Practice and Procedure, unless otherwise indicated.

T.C. Memo. 2002-141

UNITED STATES TAX COURT

DANIEL J. AND RUTH E. TAPIO, Petitioners v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 10741-01L. Filed June 4, 2002.

Daniel J. Tapio and Ruth E. Tapio, pro sese.

Randall L. Preheim, for respondent.

MEMORANDUM OPINION

GERBER, Judge: This case involves the question of whether

respondent, under the provisions of I.R.C. section 6330,1 may

proceed with the collection of petitioners’ outstanding and

unpaid tax liability. On February 5, 2002, respondent moved for
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summary judgment, and a hearing on that motion was held at the

Court’s April 29, 2002, Denver, Colorado, trial session. 

Petitioners argue that as a matter of law respondent’s assessment

of tax is invalid and without merit and that respondent should

not be allowed to proceed with collection. 

Background

On July 9, 1999, respondent mailed a statutory notice of

deficiency to petitioners determining a $1,864 income tax

deficiency for 1997 and an accuracy-related penalty under section

6662(a) and (b)(1) in the amount of $96.80. In response to the

notice, petitioners did not file a petition with this Court and

instead mailed a letter, containing their disagreement, to the

respondent’s service center which had mailed the notice. After

expiration of the appropriate statutory period, respondent

assessed the deficiency and, on January 3, 2000, mailed a notice

and demand for payment to petitioners. On July 31, 2000,

respondent mailed notification to petitioners of intent to levy

with respect to the 1997 tax liability. On March 1, 2001,

respondent mailed petitioners a Final Notice--Notice of Intent to

Levy and Notice of Your Right to a Hearing, with enclosures

pursuant to the requirements of section 6330(a).

Petitioners timely requested a Collection Due Process

Hearing and raised the following questions in their request: (1)

Whether their return filed with respondent had already shown the
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correct amount of tax, precluding the assessment of additional

amounts; (2) whether respondent had authority to determine or

collect additional tax; and (3) whether section 6331 applied in

this case. 

A face-to-face hearing was held between petitioners and

respondent’s Appeals officer. The Appeals officer provided

petitioners with a transcript of their 1997 tax account.

Petitioners recorded and transcribed the hearing. In summary,

petitioners made the following assertions at the hearing: (1) The

Appeals officer had not obtained verification in accord with

section 6330 and that the administrative requirements were not

met with respect to the intent to levy; (2) that Government

employees committed fraud by altering and correcting a public

document; (3) that wages were not taxable because they do not

represent a profit; and (4) that the provisions of the Internal

Revenue Code, and in particular section 6331, did not apply to

petitioners because they applied only to U.S. Government

employees. The Appeals officer invited petitioners to discuss

less intrusive collection alternatives, but petitioners declined

other alternatives on the ground that they did not owe tax.

On July 25, 2001, after the hearing, the Appeals Office

mailed petitioners a notice of determination concluding that

respondent could proceed with collection based on the Appeals

officer’s findings and conclusions that (1) petitioners had been
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provided with sufficient verification that the requirement of the

applicable laws and administrative procedures had been met; (2)

that the issues raised by petitioners were frivolous; (3) that

petitioners did not wish to pursue any other collection

alternatives; and (4) that the proposed collection action would

balance the need for efficient collection of tax with the

taxpayer’s legitimate concern that any collection action be no

more intrusive than necessary.

On August 28, 2001, petitioners timely petitioned this Court

alleging that they did not owe any tax and that the issues they

raised at the Collection Due Process Hearing were not addressed

by respondent’s Appeals officer. 

Discussion

Summary judgment is the appropriate means by which to

resolve this case where the pleadings and other materials

demonstrate that no genuine issue exists as to any material fact

and a decision may be rendered as a matter of law. Rule 121(b);

Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), affd.

17 F.3d 965 (7th Cir. 1994); Fla. Peach Corp. v. Commissioner, 90 

T.C. 678, 681 (1988); Shiosaki v. Commissioner, 61 T.C. 861, 862

(1974). 

Section 6330 provides that, upon request and in the

circumstances described therein, a taxpayer has a right to a

“fair hearing”. Sec. 6330(b). A “fair hearing” consists of the
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following elements: (1) An impartial officer will conduct the

hearing; (2) the conducting officer will receive verification

from the Secretary that the requirements of applicable law and

administrative procedure have been met; (3) certain issues may be

heard such as spousal defenses and offers-in-compromise; and (4)

a challenge to the underlying liability may be raised only if the

taxpayer did not receive a statutory notice of deficiency or

otherwise receive an opportunity to dispute such liability. Sec.

6330(c) and (b). 

Petitioners sought and were afforded a section 6330 hearing. 

A transcript of the hearing, which was made by petitioners and

attached to respondent’s Motion for Summary Judgment, reveals

that the Appeals officer afforded petitioners with every

opportunity to air their concerns. The Appeals officer provided

petitioners with a transcript of their 1997 tax account and

guided them through the document. The Appeals officer also read

the materials attached to petitioners’ 1997 tax return which

contained petitioners’ explanations as to why the amounts

received by petitioners were not income. The explanations

provided by petitioner have, on numerous occasions, been found by

this Court to be frivolous and without merit. 

Mr. Tapio contended that the income tax system was one of

voluntary self-assessment and because petitioners had not 

voluntarily agreed to assessment, respondent was without legal
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2 Filippini v. United States, 318 F.2d 841 (9th Cir. 1963); 

United States v. Lehigh, 201 F. Supp. 224 (W.D. Ark. 1961);

United States v. Pavenick, 197 F. Supp. 257 (D.N.J. 1961).

grounds to assess. Mr. Tapio also contended that respondent’s

employees had committed fraud by determining and assessing a tax

liability based on Forms W-2 (Wage and Tax Statement) reflecting

that he had wages. The fraud envisioned by Mr. Tapio was that

the determination and assessment constituted an alteration of

petitioners’ filed return reporting zero income and zero tax. 

Our review of the lengthy transcript of the Collection Due

Process Hearing shows that the Appeals officer was patient,

thorough, and that he had complied with the section 6330

requirements that are prerequisite for the Commissioner to pursue

collection. 

At this Court’s hearing of the parties’ arguments for and

against summary judgment, petitioners made the following

arguments that were not made at the Collection Due Process

Hearing: (1) That respondent’s notice of deficiency was

procedurally defective because respondent did not provide

petitioners with a delegation of authority showing that the

person who signed the notice had been delegated authority to do

so by the Secretary; and (2) that the notice and demand was not

in accord with T.D. 1995 issued in 1914 which required that a

Form 17, be used for that purpose. Petitioners also referenced

three cases2 which they believed supported their argument that a
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3 We must note that petitioners’ efforts appear to be solely

focused on avoiding payment and/or collection of tax on wages

that they admit receiving. Throughout the lengthy administrative

process and at the hearing on summary judgment petitioners did

not raise anything but frivolous and baseless arguments, most of

which have been rejected on numerous occasions by this and other

courts. We admonish petitioners that we shall consider the

imposition of a penalty under sec. 6673 in any future proceeding

where petitioners raise the same arguments. 

Notice and Demand for payment must be made on a Form 17. We find

petitioners’ positions to be misguided. Petitioners’ other

arguments at trial were without merit and not worthy of mention. 

After reviewing this record and hearing petitioners’

arguments, we conclude and hold that respondent did not abuse his

discretion in determining to proceed with enforced collection

activity.3

Respondent’s Motion for Summary

Judgment will be granted, and a decision

entered permitting respondent to proceed

with collection.