T.C. Memo. 2010-215

UNITED STATES TAX COURT

CURTIS F. ZASTROW, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 2994-09L. Filed October 5, 2010.

Curtis F. Zastrow, pro se.

Alicia A. Mazurek and Alexandra E. Nicholaides, for

respondent.

MEMORANDUM OPINION

PARIS, Judge: On December 24, 2008, respondent mailed to

petitioner a Notice of Determination Concerning Collection

Action(s) which sustained the filing of a notice of Federal tax

lien (NFTL) with respect to petitioner’s assessed income tax

liability for tax years 2000, 2001, and 2004. Petitioner alleges
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that he never received a notice of deficiency for those tax years

and was denied an opportunity to contest the underlying tax

liabilities. 

The issues for decision are (1) whether petitioner was

provided the opportunity to challenge the assessed tax liability

for tax years 2000, 2001, and 2004, and (2) whether respondent’s 

determination to sustain the filing of the NFTL was an abuse of

discretion. 

Background

Some of the facts and exhibits have been stipulated and are

incorporated herein by reference. At the time the petition was

filed and during the tax years 2005, 2006, and 2007, petitioner

resided and received his mail at Midland, Michigan.

Petitioner is employed as a consultant for nonprofit

organizations. Petitioner failed to file income tax returns for

tax years 2000, 2001, and 2004. Pursuant to section 6020(b)(1),1

respondent filed for each of those years a substitute for return

using third-party reporting of income paid to Curtis Zastrow of

Midland, Michigan. Respondent sent petitioner notices of

deficiency for tax years 2000 and 2001 on February 13, 2006, and

January 10, 2005, respectively. Petitioner failed to file a

petition contesting either notice of deficiency, and the tax was

1All section references are to the Internal Revenue Code of

1986, as amended.
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assessed. Respondent sent petitioner a notice of intent to levy

pursuant to section 6330 in May 2007. Petitioner timely

requested and was granted a collection due process (CDP) levy

hearing in May of 2008 for tax years 2000 and 2001 where he was

advised that he was ineligible for any collection alternative

unless and until he filed his delinquent tax returns for tax

years 2000 and 2001. Petitioner never filed those returns, and

respondent ultimately issued a notice of determination sustaining

the levy.2 Respondent mailed petitioner a notice of deficiency

for tax year 2004 on June 11, 2007. Yet again, petitioner did

not file a petition with this Court. 

 On June 24, 2008, respondent filed a NFTL against

petitioner for unpaid income taxes for tax years 2000, 2001, and

2004. Subsequently, petitioner filed a timely request with

respondent for a CDP hearing. Petitioner was assigned an Appeals

account resolution specialist (AAR specialist) who corresponded

with petitioner and informed him that to qualify for collection

alternatives, he would need to file his income tax returns for

2006 and 2007 and submit a Form 433-A, Collection Information

Statement for Wage Earners and Self-Employed Individuals, to

assist respondent in determining feasible collection

2The levy is not at issue, and the Court notes the

proceedings therein for purposes of establishing the chronology

of events leading to the NFTL and that petitioner has had one or

more opportunities to dispute the underlying tax liabilities for

tax years 2000 and 2001. 
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alternatives. Petitioner neither filed income tax returns for

tax years 2006 and 2007 nor provided the AAR specialist with the

collection information statement. 

The AAR specialist scheduled a telephone CDP hearing with

petitioner for November 18, 2008. However, petitioner did not

participate in the scheduled hearing. The AAR specialist then

rescheduled the CDP hearing for December 3, 2008, and requested

that petitioner provide further information for consideration. 

Petitioner did not take part in the rescheduled hearing but

requested a face-to-face hearing. The AAR specialist denied this

request and subsequently sent to petitioner a notice of

determination sustaining the NFTL for tax years 2000, 2001, and

2004. Petitioner then filed a timely petition with this Court.3

Discussion

 Petitioner argues that he did not receive a notice of

deficiency for tax year 2000, 2001, or 2004, that respondent’s

AAR specialist abused her discretion by denying him a face-toface hearing, and that respondent’s AAR specialist abused her

discretion when she sustained the filing of the NFTL. This Court

holds that the validity of the underlying liability is not

properly before the Court and that respondent’s AAR specialist

3Trial was held on Oct. 22, 2009, with posttrial briefs due

on Jan. 5, 2010. Petitioner failed to file a timely brief. On

Feb. 23, 2010, this Court granted petitioner’s motion for an

extension of time to file his brief. To date, petitioner has

failed to file the brief. 
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did not abuse her discretion when she denied petitioner a faceto-face hearing or when she sustained the filing of the NFTL for

tax years 2000, 2001, and 2004. 

A. Standard of Review

Under section 6321, if a person liable to pay any tax

neglects or refuses to pay the same after demand, the amount

shall be a lien in favor of the United States upon all property

and rights to property belonging to such person. A taxpayer may

appeal the filing of a NFTL to the Internal Revenue Service under

section 6320 by requesting an administrative hearing. If the

hearing culminates in an adverse determination, the taxpayer is

afforded the opportunity for judicial review of the determination

in the Tax Court pursuant to section 6330(d). Petitioner seeks

review of respondent’s determination. Where the validity of the

underlying tax liability is properly at issue, the Court will

review the matter de novo. Davis v. Commissioner, 115 T.C. 35,

39 (2000). Where the underlying tax liability is not properly at

issue, the Court will review the Commissioner’s administrative

determination for abuse of discretion. Sego v. Commissioner, 114

T.C. 604, 610 (2000); Goza v. Commissioner, 114 T.C. 176, 181-182

(2000). 

The Court has described the standard by which the

Commissioner’s determinations in CDP cases are reviewed for

“abuse of discretion”, as entailing an inquiry whether the
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determination is “arbitrary, capricious, clearly unlawful, or

without sound basis in fact or law.” Ewing v. Commissioner, 122

T.C. 32, 39 (2004), revd. on other grounds 439 F.3d 1009 (9th

Cir. 2006); see also Woodral v. Commissioner, 112 T.C. 19, 23

(1999). When a taxpayer seeks judicial review of a notice of

determination, the Court has authority to consider a section

6330(c)(2) issue only if it was properly raised in the CDP

hearing. Giamelli v. Commissioner, 129 T.C. 107, 115 (2007);

sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. An issue

is not properly raised if the taxpayer fails to present Appeals

any evidence with respect to that issue after being given a

reasonable opportunity to do so.

Section 6330(c)(2)(B) provides that at a CDP hearing, a

person may challenge the existence or amount of the underlying

tax liability “if the person did not receive any statutory notice

of deficiency for such tax liability or did not otherwise have an

opportunity to dispute such tax liability.” Petitioner argues

that he did not receive a notice of deficiency for tax year 2000,

2001, or 2004, and therefore he can challenge the underlying

liabilities. The Court disagrees. Respondent presented evidence

that the notices of deficiency were mailed to petitioner’s last

known address, and the record reflects that petitioner continues

to reside at the same address. Petitioner failed to provide any

evidence other than his own uncorroborated testimony to prove
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that he did not receive those notices. On the basis of the

evidence respondent provided, the Court is satisfied that those

notices were sent to the proper address and received by

petitioner. Therefore, the Court determines that petitioner

cannot challenge the underlying liabilities for tax years 2000,

2001, and 2004 because he has received a notice of deficiency for

each year at issue and had a prior opportunity to challenge the

tax liability for each year. Furthermore, petitioner had a

previous opportunity to challenge his underlying tax liabilities

for the tax years 2000 and 2001. A due process hearing on the

notice of intent to levy constitutes a prior opportunity to raise

and challenge an underlying tax liability within the meaning of

section 6330 and the regulations. Bell v. Commissioner, 126 T.C.

356 (2006). 

B. Face-to-Face Hearings

Petitioner contends that his hearing was not fair and

impartial because he was denied a face-to-face hearing. The

Court disagrees. Petitioner was not improperly deprived of a

face-to-face CDP hearing. See Lindberg v. Commissioner, T.C.

Memo. 2010-67; Granger v. Commissioner, T.C. Memo. 2009-258

(citing O’Meara v. Waters, 464 F. Supp. 2d 474, 479-480 (D. Md.

2006), and Turner v. United States, 372 F. Supp. 2d 1053, 1058

(S.D. Ohio 2005)). 
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Generally, there is no abuse of discretion in the IRS’

refusal of a face-to-face hearing when a taxpayer fails to

present nonfrivolous arguments, file past-due returns, and submit

financial statements as a prerequisite to a collection

alternative. See Moline v. Commissioner, 363 Fed. Appx. 675

(10th Cir. 2010), affg. T.C. Memo. 2009-110; Rice v.

Commissioner, T.C. Memo. 2009-169; Summers v. Commissioner, T.C.

Memo. 2006-219. The AAR specialist considered the information

offered by petitioner and gave him the opportunity to provide the

appropriate information in order to qualify for a face-to-face

hearing. Petitioner neither provided the requested information

nor filed past-due returns as was also requested. Consequently,

the AAR specialist did not abuse her discretion when she denied

petitioner a face-to-face hearing.

C. Filing of the NFTL

Because petitioner was not in compliance with his tax

obligations, respondent’s filing of a tax lien was appropriate. 

It is not an abuse of discretion for Appeals to reject collection

alternatives where a taxpayer has not complied with current tax

obligations. Giamelli v. Commissioner, supra at 111-112. Other

than the CDP request form, and despite being provided with two

opportunities to do so, petitioner presented no evidence to the

AAR specialist to support any of his claims. The AAR specialist

based her review on the case file and transcripts of prior
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correspondence with petitioner and found that petitioner failed

to file delinquent tax returns, failed to provide a requested

collection information statement, and did not qualify for any

collection alternatives. Therefore, the Court finds that the AAR

specialist did not abuse her discretion when she sustained the

filing of the NFTL.

On the basis of the record, the Court finds that petitioner

was given the opportunity to challenge the underlying tax

liabilities and that the AAR specialist did not abuse her

discretion in determining that the NFTL filing was appropriate. 

To reflect the foregoing,

 Decision will be entered

for respondent.