T.C. Mem o. 2 01 3- 19 4

UNITED STAT ES TAX COURT
STEPHEN R. BLACKMAN, Pet it io ne r v. COMM ISSI ONER OF INTERNAL REVENUE, Resp on de nt

Doc ke t No . 22 89 0- 09 L. File d Au gu st26 , 20 13
.
Ro nn y Buni , forpe ti ti on er. Mi m i M . W on g a ndMi ch ael J. De Ma to s, fo r res po nd en t.

MEMORANDUM OPINION FOLEY, Jud ge : Th e is su e fo r de ci si on is whethe r res po nd en t ab us edhi s di sc ret io n i n s us ta in in g ano ti ce o f Fed eral tax li en(NFTL) rel at in g t o p et it io ne r’s- 2 -

[* 2] 20 07 tax li ab il ity . The p art ie s s ub m it te d t hi s ca se ful ly sti pu la te d p ur su an t t o Ru le 12 2. 1 Bac kg ro un d Pet it io ne r, a m an ag em en t co ns ul tant , fil edhi s 2 00 7 F ed eral in co m e ta x return b utfai le d t o p ay

th e fu ll am ou ntof h is tax li ab il ity . On Sep te m be r 2, 2 00 8,
res po nd en t s en t p et it io ne r a Let te r 31 72 , Not ic e o f Fed eral Tax Li enFil in g a nd You r Ri gh t t o aHeari ng Und er IR C 6 32 0, re la ti ng to 20 07 . Res po nd en t, o n Octo be r 30 , 20 08 , sen t p et it io ne r a Let te r 10 58 , Fin al Not ic e o f In te ntto Levy and Not ic e o f Your Ri gh t t o aHeari ng (le vy no ti ce), re la ti ng to 20 07 . Peti ti on er reque st eda he ari ng rel at in g t o the lev y no ti ce b utdi d n otreque sta he ari ng rel at in g t o t he NFTL. On Fe brua ry

23 , 20 09 , res po nd en t s en t p et it io ne r a l ette r sc he du li ng a te le ph on ic co ll ect io n due pro ces s (C DP) h eari ng forMarc h 1 8, 2 00 9. Inlet te rs se ntto res po nd en t, an d dur in g t he sch edul edtel ep ho ni c h eari ng , pet it io ne r pr op os edanin st al lm en t ag reem en t an d re qu es te d wi th dr awal of t he NFTL. Pet it io ne r as se rte d tha t wi th dr awal was app ro pr ia te be cau se he ha d n o c urren t
as se ts th atco ul d b e se curedby the li enan d p ub li c d is cl os ur e o f th e NFTL cou ld Unl es s o th erwi se in di cat ed , all sec ti on refe ren ces are t o t he Int ern al 1 Rev enue Co de ineffe ctat a ll rel ev an t t im es , andall Ru le refe ren ces are t o t he Tax Co urt Ru le s o f Prac ti ce an d P ro cedur e.- 3 -

[* 3] cau se hi m

to “be fir edan d b eco m e p erm an en tl y un em pl oyabl e wit hi n * * * [h is ] in du st ry .” Inad di ti on , pet it io ne r pr ov id edth e App eal s o ffi cer wi th a Fo rm 43 3- A, Col le ct io n In fo rm at io n S ta te m en t fo r W ag e Earn ers an d S el f-Em pl oyed In di vi du al s. OnApri l 2 1, 2 00 9, p et it io ne r se ntth e App eal s o ffi cer a n a dd it io na l le tt er re qu es ti ng withd rawal of t he NFTL anda co py of h is em pl oyer’s “ em

pl oyee ha ndbo ok .” Pet it io ne r as se rte d t ha t the ha ndbo ok“ m ak es itcle ar tha t p ers on al
co nduc t awa y

fro m workcanim

pa ctem pl oyabi li ty if itha s the po te nt ia l t o c as t an adve rs e li gh t o n t he bu si ne ss .” Pet it io ne r di d n otreque sta he ari ng rel at in g t o t he NFTL. O n J un e 1 0, 2 00 9, th e App eal s o ffi cer f

ax eda le tt er t o In te rn al Rev enue Serv ic e (IR S) Tech ni cal Serv ic es reque st in g a dv ic e as to whet he r th e NFTL sh ou ldbe withd rawn . In
res po ns e, IRS Tec hn ic al Serv ic es sen t p et it io ne r a l et te r advi si ng hi m th atth e NFTL wou ldno t b e withd rawnbe cau se itwas “ ne ces sa ry to pro te ctth e go ve rn m en t’s i nt eres t” . There aft er, p et it io ne r an d re sp on de nten te redin to an in st al lm en t ag reem en t re la ti ng to pe ti ti on er’s 2 00 6, 2 00 7, an d 2 00 8 t ax li ab il it ie s. InSep te m

be r 20 09 , res po nd en t s en t p et it io ne r a n ot ic e o f de te rm in at io n s us ta in in g th e NFTL andin fo rm in g h im th atth e in st al lm en t ag reem en t was gra nt edas a n al te rn at iv e to th e p ro po se d l ev y . Peti ti on er, wh il e res id in g i n New Yo rk , ti m el y fil edhi s p et it io n wi th th e Co urt.- 4 -

[* 4] Dis cu ss io n The va li di ty of pe ti ti on er’s und erl y in g t ax li ab il ity is no t atis su e. The refo re, we rev ie w res po nd en t’s ad m in is tra ti ve de te rm in at io n fo r ab us e o f di sc ret io n. Se e Goz a v . Comm is si on er, 1 14 T.C. 17 6, 1 82 (20 00 ). Res po nd en t de te rm in edth atth e NFTL “ was ne ces sa ry to pro te ctth e g ov ern m en t’s i nt eres t”
an d t ha t wi th dr awal wou ldno t fa ci li ta te co ll ect io n o f th e ta x l iabi li ty. See s ec. 63 23 (j); s ecs . 30 1.6 32 0- 1( e)(3 ), Q&A-E6 , 30 1.6 32 3( j)-1, Pr oc ed . & Adm in . Reg s. Pet it io ne r co nt en ds th atres po nd en t ab us edhi s d is cret io n b y no t wi th dr awin g t he NFTL andfai li ng to co ns id er the im pa ctof t he NFTL onpe ti ti on er’s em pl oym en t. Res po nd en t en te redin to anin st al lm en t ag reem en t wi th pe ti ti on er b utha d th e d is cret io n t o m ai nt ai n t he NFTL. See se c. 30 1.6 32 3( j)-1( c), Pro ced . & Adm in
. Reg s. (“ If the Co m

m is si on er d et erm in es co nd it io ns forwithdrawal are p res en t, the Co m m is si on er m ay

(bu t i s n otrequi redto ) au th or iz e th e wit hd rawal .”). The App eal s o ffi cer r ev ie wedth e in fo rm at io n p et it io ne r subm itte d, ev al ua te d pe ti ti on er’s co nt en ti on s, v eri fie d t ha t the requi rem en ts of app li cab le law an d adm in is tra ti ve pro cedur e h adbe enm et , andba la nc edth e n eedforth e eff ic ie nt
co ll ect io n o f ta xe s wi th pe ti ti on er’s co nc ern s. See sec . 63 30 (c). Insu m , res po nd en t re as on ab ly det erm in edth atitwas app ro pr ia te to m ai nt ai n t he NFTL in
or de r to all ow co ll ect io n o f pe ti ti on er’s t ax li ab il ity inth e ev en t tha t h e acqui red- 5 -

[* 5] ad di ti on al ass et s o r de fau lt edon th e in st al lm en t ag reem en t. See sec . 63 23 (j);
se cs . 30 1.6 32 0- 1( e)(3 ), Q&A-E6 , 30 1.6 32 3( j)-1, Pr oc ed . & Adm in . Reg s. Res po nd en t’s d eci si on no t t o wi th dr aw th e NFTL was n otarb itrary or cap ric io us . See Woo dr al v. Co m

m is si on er, 1 12 T.C. 19 , 23 (19 99 ). Co nt en ti on s we h av e n otad dr es se d a re i rrel ev an t, m oo t, o r m eri tl es s. To re fle ctth e fo reg oi ng , Deci si on wil l b e en te red fo r res po nd en t.