1 Unless otherwise indicated, all section references are to

the Internal Revenue Code, as amended, and all Rule references

are to the Tax Court Rules of Practice and Procedure.

T.C. Memo. 2003-4

UNITED STATES TAX COURT

MORRIS TABAK, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 11465-01L. Filed January 7, 2003.

R. Scott Shieldes and Karen Baker, for respondent.

MEMORANDUM OPINION

ARMEN, Special Trial Judge: This matter is before the Court

on respondent’s Motion For Summary Judgment, filed pursuant to

Rule 121.1 Respondent contends that there is no dispute as to

any material fact with respect to this lien action and that
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respondent’s determination not to withdraw the disputed notice of

Federal tax lien should be sustained as a matter of law. 

Summary judgment is intended to expedite litigation and

avoid unnecessary and expensive trials. Fla. Peach Corp. v.

Commissioner, 90 T.C. 678, 681 (1988). Summary judgment may be

granted with respect to all or any part of the legal issues in

controversy "if the pleadings, answers to interrogatories,

depositions, admissions, and any other acceptable materials,

together with the affidavits, if any, show that there is no

genuine issue as to any material fact and that a decision may be

rendered as a matter of law." Rule 121(b); see Rule 121(a);

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

17 F.3d 965 (7th Cir. 1994); Zaentz v. Commissioner, 90 T.C. 753,

754 (1988); Naftel v. Commissioner, 85 T.C. 527, 529 (1985). The

moving party bears the burden of proving that there is no genuine

issue of material fact, and factual inferences will be read in a

manner most favorable to the party opposing summary judgment. 

Dahlstrom v. Commissioner, 85 T.C. 812, 821 (1985); Jacklin v.

Commissioner, 79 T.C. 340, 344 (1982).

As explained in detail below, there is no genuine issue as

to any material fact, and a decision may be rendered as a matter

of law. Accordingly, we shall grant respondent’s motion for

summary judgment.
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Background

The record establishes and/or the parties do not dispute the

following: 

A. Petitioner’s Tax Liabilities for 1997 and 1998

On or about August 19, 1998, Morris Tabak (petitioner) filed

with respondent a Form 1040, U.S. Individual Income Tax Return,

for the taxable year 1997. On the return, petitioner reported

adjusted gross income of $75,301 and a tax liability of $13,023,

which respondent assessed. Because petitioner paid only $0.58 of

the reported liability, respondent also assessed interest, an

addition to tax under section 6651(a)(2) for failure to pay tax,

and an addition to tax under section 6654(a) for failure to pay

estimated tax. Notice and demand for payment was sent to

petitioner on November 9, 1998.

On or about August 18, 1999, petitioner filed with

respondent a Form 1040, U.S. Individual Income Tax Return, for

the taxable year 1998. On the return, petitioner reported

adjusted gross income of $79,219 and a tax liability of $14,429,

which respondent assessed. Because petitioner paid only $138 of

the reported liability, respondent also assessed interest, an

addition to tax under section 6651(a)(2) for failure to pay tax,

and an addition to tax under section 6654(a) for failure to pay

estimated tax. Notice and demand for payment was sent to

petitioner on September 20, 1999.
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B. Post-assessment Payments Made by Petitioner

In 2000 and 2001, petitioner made a total of 4 payments in

the aggregate amount of $4,953.42 toward his unpaid liability for

1997.

In 2001, petitioner made a single payment in the amount of

$103 toward his unpaid liability for 1998.

As of April 20, 2001, the unpaid balance of petitioner’s

assessed liability was as follows:

 Unpaid Balance

Year of Assessment

1997 $9,833.66

1998 15,768.19

 25,601.85

C. Notice of Federal Tax Lien

On April 26, 2001, respondent filed a notice of Federal tax

lien with the County Clerk of Fort Bend County in Richmond,

Texas, in respect of petitioner’s outstanding tax liabilities for

1997 and 1998. Thereafter, on May 1, 2001, respondent sent

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

a Hearing Under IRC 6320, which petitioner received no later than

May 4, 2001.

D. Petitioner’s Request for a Hearing

On May 4, 2001, petitioner filed with respondent Form 12153,

Request for a Collection Due Process Hearing, in respect of his

tax liabilities for 1997 and 1998. In his request for a hearing,

petitioner stated that he did not agree with the filed notice of
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2 Our findings for this paragraph are based on the Appeals

officer’s Case Memorandum. Petitioner has not challenged or

otherwise questioned any of the statements of fact appearing in

that memorandum.

Federal tax lien because:

Lien will put me out of business. Also working on

obtaining a loan to pay off balance of $25,601.85. 

Payments have been made.

E. The Appeals Office Hearing

On July 24, 2001, petitioner attended an administrative

hearing conducted by an Appeals officer from respondent’s Appeals

Office in Houston, Texas. 

At the hearing,2 petitioner did not challenge the underlying

tax liability for either 1997 or 1998. Rather, petitioner

expressed concern that the notice of Federal tax lien would

negatively affect both his business and his ability to borrow. 

In this regard, petitioner indicated that his financial situation

was not strong and that he had not been successful in obtaining

financing to satisfy his outstanding Federal tax liabilities. 

The possibility of entering into an installment agreement or

filing an offer in compromise was discussed; however, because of

petitioner’s continuing failure to pay estimated tax and to be

current in his Federal tax obligations, the Appeals officer

indicated that it would not be possible to pursue either of those

alternatives.
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3 At the time that the petition was filed, petitioner

resided in Houston, Texas.

F. Respondent’s Notice of Determination

 On August 9, 2001, respondent’s Appeals Office issued to

petitioner a Notice of Determination Concerning Collection

Action(s) Under Section 6320 and/or 6330 with regard to his tax

liabilities for 1997 and 1998. In the notice, the Appeals Office

concluded:

the Notice of Filing of a Federal Tax Lien was legally

and procedurally correct. There exists no basis for

withdrawal of the Notice.

G. Petitioner’s Petition

On September 13, 2001, petitioner filed with the Court a

Petition for Lien or Levy Action seeking review of respondent’s

notice of determination.3 In the petition, there are no

assignments of error or allegations of fact other than the terse

statement that petitioner disagrees with “Penalties + Interest”. 

H. Respondent’s Motion For Summary Judgment

As stated, respondent filed a Motion For Summary Judgment.

Respondent contends that the petition contains nothing other than

a challenge to the underlying liability (for interest and

additions to tax), but that petitioner is precluded from pursuing

such a challenge because he failed to raise that issue in the

administrative hearing before the Appeals officer. 
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Petitioner did not file an objection to respondent’s motion. 

 Respondent’s motion was called for hearing at the Court's

motions session in Washington, D.C. Counsel for respondent

appeared and presented argument in support of the pending motion.

In contrast, there was no appearance by or on behalf of

petitioner, nor did petitioner file a statement pursuant to Rule

50(c), the provisions of which were noted in the Court’s order

calendaring respondent’s motion for hearing.

Discussion

Section 6321 imposes a lien in favor of the United States on

all property and rights to property of a person when demand for

payment of that person’s liability for taxes has been made and

the person fails to pay those taxes. The lien arises when the

assessment is made. Sec. 6322. Section 6323(a) requires the

Secretary to file notice of Federal tax lien if such lien is to

be valid against any purchaser, holder of a security interest,

mechanic’s lienor, or judgment lien creditor. Behling v.

Commissioner, 118 T.C. 572, 575 (2002).

Section 6320 provides that the Secretary shall furnish the

person described in section 6321 with written notice of the

filing of a notice of lien under section 6323. The notice

required by section 6320 must be provided not more than 5

business days after the day the notice of lien is filed. Sec.

6320(a)(2). Section 6320 further provides that the person may
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request administrative review of the matter (in the form of an

Appeals Office hearing) within the 30-day period beginning on the

day after the 5-day period described above. Section 6320(c)

provides that the Appeals Office hearing generally shall be

conducted consistent with the procedures set forth in section

6330(c), (d), and (e).

Section 6330(c) provides for review with respect to

collection issues such as spousal defenses, the appropriateness

of the Commissioner's intended collection action, and possible

alternative means of collection. Section 6330(c)(2)(B) provides

that the existence or the amount of the underlying tax liability

can be contested at an Appeals Office hearing if the person did

not receive a notice of deficiency or did not otherwise have an

earlier opportunity to dispute such tax liability. Goza v.

Commissioner, 114 T.C. 176, 180-181 (2000); see Sego v.

Commissioner, 114 T.C. 604, 609 (2000). Section 6330(d) provides

for judicial review of the administrative determination in the

Tax Court or Federal District Court.

In his petition, petitioner failed to raise a spousal

defense, make a valid challenge to the appropriateness of

respondent’s intended collection action, or offer alternative

means of collection. These issues are now deemed conceded. Rule

331(b)(4); see Behling v. Commissioner, 118 T.C. at 579. Indeed,

the only disagreement expressed by petitioner in his petition
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relates to “Penalties + Interest”. We question whether this

terse assertion constitutes a challenge to the underlying tax

liability sufficient to raise a justiciable issue for decision by

this Court. However, we need not so decide because the fact of

the matter is that petitioner did not challenge the underlying

tax liability for either 1997 or 1998 at the administrative

hearing. Accordingly, under the circumstances present herein,

petitioner is precluded from doing so in the instant proceeding. 

Sec. 301.6320-1(f)(2), Q&A-F5, Proced. & Admin. Regs.; see Miller

v. Commissioner, 115 T.C. 582, 589 n.2 (2000), affd. 21 Fed.

Appx. 160 (4th Cir. 2001); see also sec. 301.6330-1(f)(2), Q&AF5, Proced. & Admin. Regs.; Magana v. Commissioner, 118 T.C. 488,

493-494 (2002). We are unable to identify any special

circumstances in the instant proceeding that might cause us to

depart from this view.

In the absence of a valid issue for review, we conclude that

respondent is entitled to judgment as a matter of law sustaining

the notice of determination dated August 9, 2001.

In order to give effect to the foregoing,

An order granting respondent's

motion and decision for respondent 

will be entered.