T.C. Memo. 2007-91

UNITED STATES TAX COURT

SAM E. SCOTT, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 2537-05L. Filed April 17, 2007.

Sam E. Scott, pro se

John F. Driscoll, for respondent.

MEMORANDUM OPINION

GERBER, Judge: In a January 11, 2005, Notice of

Determination Concerning Collection Action(s) Under Section 6320

and/or 6330) (Notice) respondent notified petitioner that the

filing of the Notices of Federal Tax Lien (NFTLs) with the Panola

County Chancery Clerk’s Office in Batesville, Mississippi, for

petitioner’s 1991 tax liability was sustained. In a timely

petition, petitioner posed several generalized reasons why he
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1 This case was submitted fully stipulated at the Trial

Session of the Court held at Jackson, Mississippi, on Feb. 6,

2006. This matter was submitted for disposition by order of the

Chief Judge to Judge Joel Gerber on Feb. 13, 2007.

2 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 and in

effect for the period under consideration.

believed that there was an abuse of discretion and why respondent

should not be allowed to proceed with collection. The sole issue

for our consideration is whether respondent’s determination to

file NFTLs relating to petitioner’s 1991 tax liability was an

abuse of discretion.

This case was submitted fully stipulated1 pursuant to Rule

122,2 and the parties’ agreed facts and accompanying exhibits are

incorporated herein by this reference.

Background

At the time his petition was filed, petitioner resided in

Hazlehurst, Mississippi. This Court rendered an opinion deciding

the merits of petitioner’s 1991 income tax deficiency, Scott v.

Commissioner, T.C. Memo. 1997-507, and on June 19, 1998, a

decision was entered setting forth the amount of said deficiency. 

Petitioner appealed to the Court of the Appeals for the Fifth

Circuit, and this Court’s decision was affirmed (in an

unpublished opinion) on June 3, 1999. See Scott v. Commissioner,

182 F.3d 915 (5th Cir. 1999). 
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Pursuant to this Court’s decision, respondent assessed a

$73,053 deficiency in income tax, a $12,313 delinquency addition

to tax under section 6651(a)(1), a $14,611 accuracy-related

penalty under section 6662, and $72,080.39 of accrued interest. 

As of January 31, 2006, the outstanding balance due on

petitioner’s 1991 tax liability, including penalties and interest

to that date, was $288,028.05. 

During the period October 22, 2000, through mid-January

2004, respondent offset an aggregate amount of $772.64 against

petitioner’s outstanding 1991 tax liability. The offsets were

the following tax refunds claimed by petitioner and his wife on

their jointly filed returns: $56.48 (claimed for 1999), $600.00

(claimed for 2000), $112.96 (claimed for 2001), and $3.20

(claimed for 2002). 

On or about July 15, 2004, petitioner was in touch with

Revenue Officer Beth McCullough who had been assigned to collect

petitioner’s outstanding 1991 tax liability. Petitioner provided

Ms. McCullough with a letter along with a seven-page memorandum,

dated July 15, 2004, which set forth background in support of

petitioner’s request that respondent not file an NFTL with

respect to his 1991 tax liability. In the memorandum petitioner

explained that he was 67 years old, had practiced law in Jackson,

Mississippi, for 43 years, and had a good reputation. Petitioner

also outlined the status of his health explaining that he had
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heart blockage issues, high blood pressure, a malignant tumor,

which was under treatment, and motor problems with his left leg

requiring use of a walker. 

Petitioner also outlined his financial condition in the

memorandum explaining that his only steady income was a monthly

$1,727 Social Security payment and that his professional income

from law practice was greatly reduced. He listed monthly

expenses totaling $5,254.81 and various outstanding liabilities,

including credit card debt, bank loans, and mortgages totaling

approximately $422,000. His outstanding 1991 income tax

liability was not included in the $422,000 amount. Petitioner

reflected assets exceeding liabilities by an amount less than

$100,000, after considering his tax liabilities. He proposed a

plan to refinance his assets in order to make an offer-incompromise and to delay filing of the NFTLs, which petitioner

believed would “destroy” his credit. Alternatively, he stated

that if respondent filed the NFTLs and pursued collection,

petitioner would be “driven” into bankruptcy. 

Thereafter, respondent, by certified mail, sent petitioner

Notices of Federal Tax Lien Filing and Your Right To a Hearing

Under IRC 6320, dated August 4 and August 10, 2004, which is also

denominated as a “Letter 3172", along with three Notices of

Federal Tax Lien, all of which concerned petitioner’s 1991 tax

liability. The NFTLs were filed on August 6, 2004. On or about
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September 3, 2004, petitioner timely filed a Form 12153, Request

for a Collection Due Process Hearing, listing the following 13

grounds for his disagreement with respondent’s collection

actions: (1) Appropriateness of collection actions; (2)

collection alternatives; (3) impairment of spouse’s rights; (4)

amount of tax; (5) amount of interest; (6) amount of penalty; (7)

inadequacy of notice; (8) due process rights; (9) equal

protection rights; (10) other points to be made at hearing; (11)

adequacy of Appeals rights; (12) timeliness of notice of lien;

and (13) improper filing of lien. 

Petitioner’s request for a hearing was assigned to

respondent’s Appeals Officer Horace Grantham, who sent a

September 22, 2004, letter to petitioner, tentatively, to

schedule an October 5, 2004, hearing and requesting petitioner,

within 10 days, to advise of his availability for such hearing. 

By that same letter, Appeals Officer Grantham forwarded a Form

433-A, Collection Information Statement for Wage Earners and

Self-Employed Individuals, on which petitioner was to provide

information to enable the Appeals officer to consider collection

alternatives. Petitioner sent a letter, dated September 27,

2004, to the Appeals officer requesting that the October 5, 2004,

date be rescheduled to a date after October 26, 2004. The

Appeals officer replied by a September 29, 2004, letter

rescheduling a hearing for October 27, 2004. The hearing was
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again rescheduled for November 3, 2004, and on November 1, 2004,

petitioner called and requested a further rescheduling to

November 9, 2004. On November 9, 2004, petitioner telephoned

Appeals Officer Grantham and indicated that he had suffered an

injury, and the hearing was finally scheduled for November 16,

2004.

The hearing was held on November 16, 2004, and the following

general topics were discussed: (1) The Appeals process and the

then outstanding amount of petitioner’s 1991 tax liability; (2)

collection alternatives, such as offers-in-compromise and

installment payment plans, were limited due to the fact that

petitioner’s net worth was sufficient to pay his entire 1991 tax

liability; (3) the possibility of respondent’s collecting the

entire amount of the 1991 tax liability from petitioner’s equity

in a retirement account, and a possible tax advantage from

coordination of levies by respondent on that account; (4)

petitioner declined any additional discussion of his 13 items of

disagreement which he had listed on the Form 12153, but he

reserved the opportunity to detail his disagreement in a

subsequent writing; (5) petitioner advised that he would consult

with his certified public accountant (C.P.A.) to determine what

was in his best interest and notify Appeals Officer Grantham by

the end of the week. 
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Appeals Officer Grantham concluded that petitioner’s net

worth was sufficient to satisfy the outstanding 1991 tax

liability mainly due to the $308,000 equity in a retirement

account, which was subject to loans of $36,000. The day after

the hearing, Appeals Officer Grantham spoke with Revenue Officer

McCullough to make arrangements for a possible levy on

petitioner’s retirement account.

On November 19, 2004, Appeals Officer Grantham received, by

facsimile, a letter with an attachment from petitioner

supplementing the matters discussed at the November 16, 2004,

hearing. In the November 19, 2004, facsimile, petitioner

reiterated his health-related difficulties, and he also pointed

out that the tax year involved was 1991 so that 13 years of

interest had accrued which represented 75 percent of the

outstanding balance due. Petitioner also emphasized that he had

a good record as a taxpayer during the past 43 years and that

cutting off alternative methods for resolution was not

appropriate. Petitioner advanced Mississippi law in support of

his position that his wife had a right to occupy the “marital

domicile”, and the filing of a lien would impinge on that right

and also lessen the value of the realty without providing

respondent with additional opportunities to collect. Petitioner

also complained that respondent had “appropriated” joint tax

refunds to satisfy part of his individual 1991 tax liability. 
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Petitioner also attempted to question whether the section

6651(a)(1) addition to tax and the section 6662 penalty were

overstated. 

In the November 19, 2004, facsimile petitioner also

contended that the outstanding amounts of the addition to tax and 

penalty reflected on the NFTLs exceeded the 25 percent and 20

percent amounts, respectively, set forth in sections 6651(a)(1)

and 6662 and, therefore, were invalid. Finally, petitioner

contended that the hearing did not provide him with either

substantive or procedural due process because: 

1. There are no standards or procedures for conduct

of the hearing. 

2. There is no provision for making a written record

of the hearing. 

3. No burden of proof is provided, nor is taxpayer 

informed as to what is grounds for relief. 

4. The presiding officer at the hearing is employed 

by the IRS, an adversary party, and therefore cannot 

be impartial for due process purposes. 

5. No evidence is required or presented by IRS to 

establish that due process rights have been afforded.

6. The hearing is a post-deprivation hearing which 

does not comply with due process requirements. 

There is no due process requirement for filing the lien. 

7. Taxpayer was not allowed at the hearing to present 

an offer in compromise. The provisions of [section] 

6631 require that every IRS notice that includes an 

amount of interest required to be paid by the taxpayer 

must include a detailed computation of the interest 

charged. This was not done in this case as is 

demonstrated by the IRS’s notices. 
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Petitioner sent no further communications to Appeals Officer

Grantham, and, accordingly, no further information was advanced

about any particular collection alternative. On January 11,

2005, the Notice was sent to petitioner, and he timely instituted

this proceeding on February 9, 2005. In essence, the Notice

explained that because a review of petitioner’s assets revealed

that he had sufficient equity to pay the tax liability in full,

there was no prospect for the consideration of an offer-incompromise. The Notice also indicated that petitioner stated

that he would consult with his C.P.A. and advise respondent about

ways to gain a tax advantage from coordination of levies, but

petitioner failed to provide this information. Also reiterated

in the notice of determination, was that petitioner had declined

to discuss “the issues * * * [he] raised in * * * [his] request

for a hearing”. The Notice concluded with the determination that

the filing of the NFTLs with the Panola County Chancery Clerk’s

Office in Batesville, Mississippi, for petitioner’s 1991 income

tax liability was sustained.

In addition to the above Notice, respondent sent the

following Letters to petitioner regarding his 1991 tax liability:

1. Letter CP-14: Sent on or about November 9, 1998, which

normally contains payment history and contact telephone numbers. 
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2. Letter CP-501: Sent on or about December 28, 1998, 

which contained tax liability information and contact telephone

numbers. 

3. Letters CP-503: Sent on or about February 1, 1999, and

October 28, 2002, which contained tax liability information and

contact telephone numbers.

4. Letters CP-504: Sent on or about March 8, 1999, April

12, 1999, September 4, 2000, and July 7, 2003, which contained

tax liability information and contact telephone numbers. 

5. Letter 3174: Sent on or about August 29, 2003, by

Internal Revenue Officer Beth McCullough advising that if the

1991 tax balance due were not paid by September 12, 2003, an NFTL

would be filed. 

6. Letter 3172: Sent on August 4, 2004, by Revenue Officer

McCullough notifying of the filing of an NFTL for petitioner’s

1991 tax liability. 

Discussion

Petitioner, who had practiced law in Mississippi for 43

years, represents himself in this proceeding where, for various

reasons, he contends there was an abuse of discretion in

respondent’s filing of an NFTL. On several occasions, petitioner 
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3 The broad contentions include:

(1) Appropriateness of collection actions; (2)

collection alternatives; (3) impairment of

spouse’s rights; (4) amount of tax; (5) amount of

interest; (6) amount of penalty; (7) adequacy of

notice; (8) due process rights; (9) equal

protection rights; (10) other points to be made at

hearing; (11) adequacy of Appeals rights; (12)

timeliness of notice of lien; and (13) improper

filing of lien.

4 Petitioner’s pleading, submissions to respondent, and

his legal briefs filed with the Court are terse and contain

broad platitudes without meaningful rationale or support in

statutes, regulations or case precedent. We do not hold

petitioner to a higher standard because of his extensive

legal career, but simply note that he had the ability or

capacity to provide the Court with legal support, if any

exists, for his allegations or assertions. 

has listed 13 broad contentions3 which he believes support his

assertion that there has been an abuse of discretion. 

Petitioner, however, in this shotgunlike approach has not 

provided meaningful detail or legal support for his contentions,

either to respondent or to the Court.4

Petitioner vigorously pursued respondent’s determination of

his 1991 income tax deficiency, and he was unsuccessful in this

Court and in his Appeal to the Court of Appeals for the Fifth

Circuit. Scott v. Commissioner, T.C. Memo. 1997-507, affd. 182

F.3d 915 (5th Cir. 1999). Accordingly, petitioner may not

contest the existence or amount of the underlying tax liability

because he received a notice of deficiency, and he had a full

opportunity to dispute the underlying tax liability. Sec.
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5 “Priority” used in this context refers to respondent’s

claim or right to payment vis-a-vis other creditors’ claims

against petitioner’s property or rights to property.

6330(c)(2); Sego v. Commissioner, 114 T.C. 604, 610 (2000); Goza

v. Commissioner, 114 T.C. 176, 180-181 (2000). Moreover,

petitioner would also be barred from litigating a second time his

1991 income tax liability based on the principles of res

judicata. 

Our consideration in this case is therefore limited solely

to the question of whether there was an abuse of discretion in

respondent’s determination to proceed with collection action and

in particular to file an NFTL. Where the underlying tax

liability is not at issue, the Court will review the Appeals

officer’s determination for abuse of discretion. Sego v.

Commissioner, supra. In this case, petitioner’s 1991 tax

liability was assessed in accord with the decision of this Court. 

Property and rights to property of petitioner become subject to a

lien arising in favor of the United States at the time of the

assessment because petitioner failed to pay the tax liability

after notice and demand for payment. Secs. 6321 and 6322. The

lien is not entitled to priority5 with respect to the claims of

certain other creditors of petitioner until an NFTL is filed. 

Sec. 6323(a).

As of January 31, 2006, petitioner’s outstanding balance due

for his 1991 tax liability, including penalties and interest to
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that date, was $288,028.05. At the hearing afforded to

petitioner, however, it was determined that his equity in assets,

including a retirement account which approximated the amount of

the tax liability, exceeded his outstanding income tax liability. 

For that reason, the Appeals officer did not believe there was a

prospect for the consideration of an offer-in-compromise,

although the Appeals officer was open to working out a schedule

to levy on the retirement account in a manner that would minimize

the tax and/or penalty burden on retirement account distributions

used to pay the outstanding tax liability.

Many of petitioner’s contentions in support of his argument

that there was an abuse of discretion have their roots in

respondent’s failure to consider and/or agree to collection

alternatives or to delay in filing an NFTL so as to lessen the

detrimental effect on petitioner or his wife. We proceed to

evaluate petitioner’s contentions.

I. Whether Petitioner Was Entitled to a Hearing Prior to

 Respondent’s Filing an NFTL

Petitioner has contended that he was not afforded due

process because respondent did not provide him with a hearing

prior to filing an NFTL. See Beery v. Commissioner, 122 T.C.

184, 190 (2004). Section 6320(a) provides for notification of

the filing of an NFTL in writing not more than 5 business days

after the date of the filing of an NFTL. The express statutory

language does not entitle petitioner to a hearing prior to the
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6 We note that petitioner, unlike the taxpayer in Phillips,

litigated his liability on the merits before a lien arose and in

that sense was afforded a prior judicial determination of his

legal rights.

filing of the NFTL. Under section 6320(a), respondent may file

the NFTL before notifying petitioner or providing him with a

hearing. We note, however, that petitioner did discuss his

outstanding liability and the potential for the filing of an NFTL

with respondent’s collection officer prior to the filing.

As a general matter 

The right of the United States to collect its internal

revenue by summary administrative proceedings has long

been settled. Where * * * adequate opportunity is

afforded for a later judicial determination of the

legal rights, summary proceedings to secure prompt

performance of pecuniary obligations to the government

have been consistently sustained. [Fn. ref. omitted.]

 

Phillips v. Commissioner, 283 U.S. 589, 595 (1931);6 see also

United States v. Natl. Bank of Commerce, 472 U.S. 713 (1985). 

The statutes we consider provide for prompt notice after the

collection action (filing the NFTL) and for a hearing and

judicial review. Secs. 6320, 6330. Therefore, petitioner’s

contention that there was a lack of due process must fail.

Petitioner also contended that respondent did not provide

him with a timely notice under section 6320 (sent to his last

known address within 5 business days of the NFTL filing), but the

record reflects that respondent met the time requirement and 
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provided petitioner with a hearing in response to his

disagreement with the collection action.

II. Whether Respondent Failed To Adopt or Employ Uniform

Rules or Procedures for the Hearing Pursuant to

Sections 6320 and/or 6330; Whether the Administrative

Procedures Act Applies to the Hearings; and Whether It

Is Respondent’s Obligation To Record the Hearing

Petitioner makes the vague argument that no uniform rules or

procedures existed for the conduct of the administrative hearing

and/or that he was not apprised of same. Respondent counters

that there were available to petitioner, in addition to the

above-referenced statutes, section 301.6320-1, et seq., Proced. &

Admin. Regs., and section 301.6330-1, et seq., Proced. & Admin.

Regs., which provide rules and procedures for the hearing and the

related process. We agree with respondent and find petitioner’s

contention to be without merit or substance.

Petitioner also contends that the provisions of the

Administrative Procedure Act, 5 U.S.C. sec. 551-557 (1994) 

should apply to the sec. 6320/6330 hearing. Respondent has

stated in procedural regulations that a hearing under sections

6320 and 6330 is not under the formal hearing provisions of the

Administrative Procedure Act. See sec. 301.6320-1(d)(2), Q&A-D6,

Proced. & Admin. Regs.; sec. 301.6330-1(d)(2), Q&A-D6, Proced. &

Admin. Regs. Petitioner complained that the hearing was not

recorded by respondent, but petitioner did not seek, nor was he
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7 At the time of petitioner’s hearing, this Court had

decided that taxpayers, in certain circumstances, have the right

to record a sec. 6320/6330 hearing. Keene v. Commissioner, 121

T.C. 8 (2003).

denied the opportunity, to record the hearing.7 In Davis v.

Commissioner, 115 T.C. 35, 41-42 (2000), we emphasized that the

hearing process is informal and does not require testimony under

oath or certain other formalities. Petitioner does not raise any

other specific or particular aspect of the Administrative

Procedure Act that should have been applied, and, in any event,

he did not say in what manner it would have made a difference in

this case if such procedures had been followed. Accordingly, we

find no merit in these contentions.

III. Whether Respondent Was Required To Provide Petitioner

With Specific Information About the Rules,

Regulations, and or Procedures Governing Hearings; and

Whether There Is Any Limitation on Respondent’s Use of

Information Gained at the Hearing To Further

Subsequent Collection of the Tax

Although contending that respondent is required to provide

taxpayers with specific information about the rules, regulations,

and/or procedures governing hearings, petitioner has not cited

any statute, regulation, or case that mandates such a

requirement. Respondent contends that no such requirement

exists. Section 6331(d)(4) requires the Internal Revenue Service

to inform a taxpayer in nontechnical terms of the administrative

appeal rights available with respect to a levy. Similar

obligations, respecting liens, as well as levies, are imposed by
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regulation sections 301.6320-1(a)(2) Q&A-A10 and 301.6330-1(a)(3)

Q&A-A7. In that regard, petitioner was sent Publication 1660,

with the August 4, 2004, Letter 3172, Notice of Federal Tax Lien

Filing and Your Right To A Hearing Under IRC 6320. Publication

1660 describes the Appeals rights available to taxpayers, along

with mention of hearing issues provided for in sections 6320(c)

and 6330(c). In addition, the Appeals officer explained the

hearing process to petitioner and encouraged him to provide

additional information or issues. Accordingly, there is little

for petitioner to complain about in the setting of this case. 

Further, it has been held that an Appeals officer’s failure to

provide a taxpayer with a written set of all rules, regulations,

and procedures applying to section 6320 and section 6330 hearings

was not an abuse of discretion. See Davis v. Commissioner, supra

at 41-42; Lindsay v. Commissioner, T.C. Memo. 2001-285; see also

Wylie v. Commissioner, T.C. Memo. 2001-65.

With respect to whether respondent can use information

obtained at a section 6320/6330 hearing to advance subsequent

collection, again petitioner did not provide any statute,

regulation, or precedent that would prevent respondent from doing

so. Respondent contends that he is not so limited, but that he

was not aware of any such use in this case. We agree with

respondent that no such limitation has been shown to exist.
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8 We also note that petitioner failed to acknowledge that

the notice period is 5 business days, which even under

petitioner’s flawed approach could have explained the difference.

IV. Whether Respondent Complied With the Notice

Requirements for the Filing of a Notice of Federal

Tax Lien, and Whether the Appeals Officer Was Required

To Provide Petitioner With All Documents Maintained by

Respondent With Respect to Him

Petitioner, on brief, makes the barebones argument that

respondent “must comply with notice requirements when filing a

lien.” To make his point, petitioner, on brief, argues that

“Notice of the filing of the lien was not given within five days

in that the liens were filed on August 3, [sic]2005 and the

notice was not dated until August 10, [sic]2005.” In response,

respondent points out that the NFTLs were actually filed with the

County Chancery Courts on August 6, 2004, and the Notices sent to

petitioner were mailed on August 4 and August 10, 2004. The

record bears out respondent on this point. We again note 

petitioner’s shotgunlike approach and his propensity to grasp at 

straws without providing any meaningful support for his position.8

Petitioner contends that the Internal Revenue Service “must

provide a taxpayer with documents related to him or her in its

file.” Here again, this unsupported contention is without

specificity or distinction. Respondent sent numerous notices,

publications, and other materials to petitioner and provided him

with summaries, Certificate of Assessments and Payments, Forms

4340, with respect to his 1991 tax account. There is no other
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specific indication by petitioner as to the information or

documents he was or was not provided either prior to or during

the hearing process. 

The Appeals officer used Forms 4340 to verify the

assessments. We have held that “it was not an abuse of

discretion for the Appeals officer to use Forms 4340 for purposes

of complying with section 6330(c)(1).” Nestor v. Commissioner,

118 T.C. 162, 166 (2002); Davis v. Commissioner, supra at 41;

Lindsay v. Commissioner, T.C. Memo. 2001-285.

 Section 6330(c)(1) does not require the Appeals officer to

provide taxpayers with a copy of a document verifying that the

requirements of any applicable law or administrative procedure

have been met. Section 301.6330-1(e)(1), Proced. & Admin. Regs.,

requires that the Appeals officer obtain verification before

issuing the determination; it does not state that he or she must

provide it to the taxpayer. Further, there is no legal

requirement that the Appeals officer provide a taxpayer with

copies of the delegations of authority, assessment records, or

other underlying documents maintained by respondent with respect

to a taxpayer’s account. Nestor v. Commissioner, supra at 166. 

Accordingly, the Appeals officer in this case sufficiently

verified the 1991 tax assessments and was not required to provide

more.
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9 It is clear that the addition to tax and penalty were

assessed in amounts that coincided with the dollar amounts

contained in our decision in the deficiency proceeding. 

Petitioner is barred from contesting that assessment under the

principle of res judicata as well as sec. 6330(c)(2)(B). 

(continued...)

V. Whether the Penalties and Interest Assessed Against

 Petitioner Were Excessive

Petitioner, in his brief, makes a terse reference to the

fact that the interest and penalties are excessive. In his

November 19, 2004, facsimile to Appeals Officer Grantham,

petitioner indicated that the tax year was then 13 years old and

that the income tax liability was only 25 percent of the total,

whereas the penalties and interest represented 75 percent of the

total. He also bemoans the fact that the original 25-percent

addition to tax and 20-percent penalty assessed under sections

6651(a)(1) and 6662, respectively, continue to increase in that

they are interest sensitive. Petitioner contends that the 25

percent and 20 percent amounts set forth in the respective

statutes are intended to be limitations on the maximum amount of

penalty and that the increased amounts are “excessive”. 

As already discussed, petitioner was not entitled to raise

the underlying merits of the tax and penalties for 1991 because

he received a statutory notice of deficiency and litigated the

merits of same. See sec. 6330(c)(2)(B). Petitioner has not

shown that the amount of tax, penalties, or interest are 

incorrectly computed.9 Instead, he broadly claims they are
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9(...continued)

Although petitioner is not barred from contesting whether the

interest accumulated on the assessment was correctly computed by

respondent, he has not made that argument. See Urbano v.

Commissioner, 122 T.C. 384, 392-393 (2004). Petitioner’s

argument here is that accumulated interest on the addition to tax

and penalty causes those amounts to exceed the statutorily

prescribed percentages of 25 and 20 percent, respectively.

excessive without providing any statutory, regulatory, or case

precedent in support of his position. To the extent that

petitioner was entitled to question the amount of the penalties

and interest included in the outstanding 1991 tax liability, he

has not provided sufficient information from which we could

conclude that respondent’s assessed amounts are in error. 

VI. Whether There Was Compliance by Respondent With

Sections 6631 and 6751

Sections 6631 and 6751, which were enacted as part of the

Internal Revenue Service Restructuring and Reform Act of 1998,

Pub. L. 105-206, 112 Stat. 685, requires the Secretary to include

certain information on any notice to a taxpayer of liability for

interest or for a penalty. Sections 6631 and 6751 were effective

for notices sent to taxpayers after December 31, 2000, which date

was extended to June 30, 2001, by the Community Renewal Tax

Relief Act of 2000, Pub. L. 106-554, section 302(b) and (c), 114

Stat. 2763A-632. In addition, sections 302(b) and (c) of the

Community Renewal Tax Relief Act of 2000 also provided that the

requirements of sections 6631 and 6751(a) would be “treated as

met” if any notice issued after June 30, 2001, and before July 1,
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2003, contained a telephone number at which the taxpayer could

request a copy of assessments and payment histories including

interest and penalties.

In this case, 10 notices were sent to petitioner with

respect to his 1991 tax liability. Six of those notices were

sent prior to the extended June 30, 2001, effective date. One of

the notices sent after June 30, 2001, contained telephone numbers

and is treated as meeting the requirements of sections 6631

and/or 6751(a). The remaining three notices did not meet the 

interest computation requirements of section 6631.

The question we must consider is whether respondent’s

failure to comply with the section 6631 computation of interest

requirements on 3 of 10 notices has any effect on the validity or

effectiveness of the 1991 assessment and/or the NFTLs filed by

respondent. The statute requires that respondent include a

computation of the amount of interest on each notice, but there

is no indication of any consequence or remedy for failure to do

so. 

In the context of the review of an administrative act or

proceeding, this Court has utilized the “theory of detrimental

reliance” and considered the “rule of prejudicial error"

(otherwise known as the doctrine of harmless error). See, e.g.,

Nestor v. Commissioner, supra at 167; Rochelle v. Commissioner,

116 T.C. 356, 363 (2001), affd. 293 F.3d 740 (5th Cir. 2002). 
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The question in such cases usually involves the effect, if any,

that a procedural omission or error would have on the outcome or

validity of respondent’s actions. Generally, reviewing courts

have disregarded procedural omissions or errors 

unless there was reliance on and prejudice to the complaining

party. 

The Court of Appeals for the First Circuit provided

guidance, suggesting that a balanced approach be used in applying

the rule of prejudicial error, as follows: 

be cautious in assuming that the result would be the

same if an error, procedural or substantive, had not

occurred, and there may be some errors too fundamental

to disregard. But even in criminal cases involving

constitutional error, courts may ordinarily conclude

that an admitted and fully preserved error was

“harmless beyond a reasonable doubt.” Agency missteps

too may be disregarded where it is clear that a remand

“would accomplish nothing beyond further expense and

delay.” [Citations omitted.]

Save Our Heritage, Inc. v. FAA, 269 F.3d 49, 61-62 (1st Cir.

2001). It has been held that the party seeking judicial review

of an agency action bears the burden of demonstrating prejudice

from any error. Boyd v. United States, 121 Fed.Appx. 348, 350

(10th Cir. 2005), affg. 322 F.Supp.2d 1229 (D.N.M. 2004); DSE,

Inc. v. United States, 169 F.3d 21, 31 (D.C. Cir. 1999).

In this case respondent failed to compute the amount of

interest on three notices sent to petitioner after the extended

effective date of sections 6631 and 6751(a). In that regard,

respondent did include a telephone number that petitioner could
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have used to obtain the amount of outstanding interest on his

1991 tax liability. In addition, respondent provided petitioner

with statements of the amount of interest outstanding at the time

the Forms 4340 were presented to him. Petitioner, who is an

experienced attorney, does not contend or allege that he in any

manner was prejudiced by respondent’s failure to provide the

amount of interest on the notices. Petitioner has not stated how

he may have been prejudiced by the omission of the amount of

outstanding interest on the three notices. The fact of the

matter is that petitioner was well aware of the amount of

interest and complained mightily about it.

In this record there was no prejudice on respondent’s

omission of the amount of interest on 3 of the 10 notices sent to

petitioner. Further, petitioner has not shown that he was

prejudiced by such omissions. Accordingly, we find it

unnecessary to consider what type of remedial action, if any,

would be appropriate. 

VII. Whether Respondent’s Filing of Notices of Federal Tax

Lien was Improper Deprivation of Property or Property

Rights

Continuing with his shotgun approach to this proceeding,

petitioner contends that “The Fifth Amendment to the United

States Constitution provides that no person shall be deprived of

life, liberty or property without due process of law, which is

not a term without meaning.” Respondent’s use of statutorily
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created summary collection provisions has been approved by the

courts for many years and found to be constitutional. Here,

obviously, there is no taking or deprivation of property without

due process. The administrative proceeding in which petitioner

participated and the litigation in which he now engages are

designed to provide petitioner with due process. See Myers v.

United States, 647 F.2d 591, 602 (5th Cir. 1981). Moreover,

petitioner availed himself of the opportunity to litigate the

merits of respondent’s determination of the underlying tax

liability and pursued his position on appeal to the Court of

Appeals for the Fifth Circuit. It was only after our decision in

that case was final and petitioner’s failure to pay that

respondent used summary collection methods. Here again

petitioner’s contention is without substance or merit. 

VIII. Whether Respondent Was Entitled To Offset Tax

 Refunds From Joint Returns of Petitioner and His Wife

 Against Petitioner’s Outstanding Individual 1991 Tax

 Obligation

Petitioner’s individual tax liability, including interest

and penalties, was approximately $288,028.05 (with interest

calculated to January 31, 2006). Respondent offset a total

amount of $772.64 of refunds from petitioner’s and his wife’s

joint 1999 through 2002 Federal income tax returns. Petitioner

broadly contends that respondent is not entitled to offset joint 

income tax refunds against the individual tax of one of the joint

filers. 
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Initially, the filing of a joint return does not, per se,

make the joint filers equal “owners” of any refund of tax from 

said return. Instead, each joint filer is apportioned an

interest in the overpayment to the extent he or she contributed

to the overpayment. See Gens v. United States, 230 Ct. Cl. 42, 

673 F.2d 366 (1982). In that regard, petitioner has not shown

that any portion of the overpayments for the years 1999 through

2002 was attributable to his wife. Without such information, we

cannot find that there was any abuse of discretion in not

adjusting or reversing the offsets.

Conclusion and Holding--Although petitioner’s filings were

sparse and terse, we have carefully considered his summary

contentions. To the extent that we have not addressed any

particular aspect of his contentions, they are not worthy of

further consideration or comment. We hold that respondent’s

determination to pursue collection by filing Notices of Federal

Tax Liens was not an abuse of discretion. In this case where

petitioner has not shown how a compromise of his liability would

promote effective tax administration coupled with his admission

that his assets are sufficient to pay the outstanding tax

liability, respondent’s refusal to consider alternatives is not

an abuse of discretion. Petitioner’s contention in this regard

has been that the filing of a lien will affect his credit and 

ability to sell or transfer assets. Those reasons do not, per
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se, make it unreasonable for respondent to refuse an offer-incomprise. 

To reflect the foregoing,

Decision will be entered

for respondent.