T.C. Memo. 2008-180

UNITED STATES TAX COURT

THOMAS CHRISTOPHER BROOME, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 7259-05. Filed July 30, 2008.

Thomas Christopher Broome, pro se.

John F. Driscoll, for respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

VASQUEZ, Judge: On October 18, 2004, respondent issued a

notice of final determination disallowing petitioner’s request

for abatement of interest on income tax liabilities for 1994 and

1995. The sole issue for decision is whether respondent’s
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1 All section references are to the Internal Revenue Code

in effect for the years in issue unless otherwise indicated, and

all Rule references are to the Tax Court Rules of Practice and

Procedure.

decision pursuant to section 64041 not to abate assessments of

interest relating to petitioner’s 1994 and 1995 taxable years was

an abuse of discretion.

FINDINGS OF FACT

Some of the facts have been stipulated and are so found. 

The stipulation of facts and the attached exhibits are

incorporated herein by this reference. At the time he filed the

petition, petitioner resided in Mississippi.

Petitioner was one of two shareholders in T.C. Broome

Construction Co., Inc. (Broome Construction), an S corporation. 

Petitioner owned 60 percent of Broome Construction. Petitioner

filed his 1994 and 1995 Federal income tax returns on October 18,

1995 and 1996, respectively. The Internal Revenue Service (IRS)

audited Broome Construction’s returns for the 1994, 1995, and

1996 taxable years in April 1997. The audit included a review of

petitioner’s 1994, 1995, and 1996 returns. On or about February

13, 1998, the examining agent sent a proposed final examination

report to petitioner regarding his 1994, 1995, and 1996 returns. 

Petitioner filed a request for consideration with the IRS

Office of Appeals on or about April 6, 1998. On April 14, 1998,

petitioner signed a Form 872, Consent to Extend the Time to
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Assess Tax, which extended the period to assess tax for 1994

until April 15, 1999. Appeals Officer Penny Young (Ms. Young)

received the case on June 5, 1998. 

Ms. Young worked on the case for 2 years and experienced

some delay in processing the appeal. One delay resulted from a

tropical storm in the area. Ms. Young had to travel from New

Orleans, Louisiana, to Mobile, Alabama, to meet with petitioner

and his representatives regarding the determinations. Therefore,

the meetings occurred roughly every few months. On at least one

occasion petitioner’s representatives’ failure to attend the

meeting resulted in rescheduling. The longest delay resulted

from waiting for records to be sent from petitioner and his

representatives to Ms. Young so she could process petitioner’s

appeal. 

As a result of the delays Ms. Young requested three more

Forms 872 while processing petitioner’s appeal. Petitioner

signed his second Form 872 on December 28, 1998, extending the

period to assess tax for 1994 until December 31, 1999. 

Petitioner’s representative signed the third Form 872 on July 29,

1999, extending the period to assess tax for 1994 and 1995 until

April 15, 2000. Petitioner signed the fourth and final Form 872

on January 26, 2000, extending the period to assess tax for 1994

and 1995 until June 30, 2000. Ms. Young mailed the last Form 872 
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to petitioner before December 31, 1999, but did not receive the

signed Form 872 back until January of 2000. 

In January 2000 petitioner and respondent reached a

tentative settlement agreement for which settlement documents

were prepared. Petitioner signed a Form 870-AD, Offer to Waive

Restrictions on Assessment and Collection of Tax Deficiency and

to Accept Overassessment, with respect to his personal income tax

liability determination for taxable years 1994 and 1995 on

January 26, 2000. Ms. Young received the signed Form 870-AD on

February 17, 2000. Respondent’s review of the Form 870-AD

concluded in March 2000, and respondent officially closed

petitioner’s case.

Respondent assessed the deficiencies for 1994 and 1995 on

May 12, 2000. On April 15, 2001, respondent credited

overpayments from 1998, 1999, and 2000 to petitioner’s balance

for 1994 and 1995 resulting from the assessment of deficiencies. 

Thereafter, petitioner’s outstanding balance was zero.

On April 14, 2002, petitioner filed a Form 843, Claim for

Refund and Request for Abatement, for his taxable years 1994,

1995, and 1996. Respondent did not act on this request for

abatement of interest. Petitioner filed another Form 843 on

April 17, 2003. In June of 2004 respondent assigned IRS Examiner

Patricia Wood (Ms. Wood) to review the request petitioner filed

on April 17, 2003. Ms. Wood reviewed petitioner’s April 2003
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2 In 1996, sec. 6404(e) was amended by the Taxpayer Bill of

Rights 2, Pub. L. 104-168, sec. 301(a), 110 Stat. 1457 (1996), to

permit the Commissioner to abate the assessment of interest

attributable to IRS errors or delays in performing both

managerial and ministerial acts. The amendment applies to

interest accruing with respect to deficiencies for taxable years

beginning after July 30, 1996, and therefore does not apply to

the matter before us.

request for abatement of interest, and respondent issued an IRS

Letter 2289(DO) tentatively denying the April 2003 request on

August 17, 2004. Petitioner failed to respond to the IRS Letter

2289(DO), and respondent issued a final determination letter on

October 18, 2004. 

OPINION

I. Section 6404(e)

Pursuant to section 6404(e)(1), the Commissioner may abate

the assessment of interest in two situations: (1) When a

deficiency is attributable to an error or delay by an officer or

employee of the IRS in performing a ministerial act, or (2) when

interest is assessed on any payment of certain taxes (including

income tax) to the extent that an error or delay in such payment

is attributable to an officer or employee of the IRS being

erroneous or dilatory in performing a ministerial act.2 An error

or delay by an officer or employee of the IRS shall be taken into

account only if no significant aspect of such error or delay can

be attributed to the taxpayer involved, and after the IRS has 
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3 Final regulations under sec. 6404 were issued on Dec. 18,

1998, and contain the same definition of a ministerial act as do

the temporary regulations. See sec. 301.6404-2(b)(2), Proced. &

Admin. Regs. The final regulations generally apply to interest

accruing on deficiencies or payments of tax described in sec.

6212(a) for taxable years beginning after July 30, 1996, and do

not apply to the years at issue in this case. See sec. 301.6404-

2(d)(1), Proced. & Admin. Regs. 

contacted the taxpayer in writing with respect to such deficiency

or payment. Id.

A “ministerial act” is a procedural or mechanical act that

does not involve the exercise of judgment or discretion and that

occurs during the processing of a taxpayer’s case after all

prerequisites to the act, such as conferences and review by

supervisors, have taken place. Sec. 301.6404-2T(b)(1), Temporary

Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).3 A

decision concerning the proper application of Federal tax law (or

other Federal or State law) is not a ministerial act. Id.

Even where errors or delays are present, the Commissioner’s

decision to abate interest remains discretionary. See sec.

6404(e)(1); Mekulsia v. Commissioner, T.C. Memo. 2003-138, affd.

389 F.3d 601 (6th Cir. 2004). When Congress enacted section

6404(e), it did not intend the provision to be used routinely to

avoid payment of interest. Rather, Congress intended abatement

of interest to be used only where failure to do so “would be

widely perceived as grossly unfair.” H. Rept. 99-426, at 844 
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(1985), 1986-3 C.B. (Vol. 2) 1, 844; S. Rept. 99-313, at 208

(1986), 1986-3 C.B. (Vol. 3) 1, 208.

II. Standard of Review and Burden of Proof

When reviewing the Commissioner’s determination not to abate

interest, we apply an abuse of discretion standard. See sec.

6404; Camerato v. Commissioner, T.C. Memo. 2002-28. The taxpayer

bears the burden of proof with respect to establishing an abuse

of discretion. See Rule 142(a). In order to prevail, the

taxpayer must establish that in not abating interest the

Commissioner exercised his discretion arbitrarily, capriciously,

or without sound basis in fact or law. Lee v. Commissioner, 113

T.C. 145, 149 (1999); Woodral v. Commissioner, 112 T.C. 19, 23

(1999). 

III. Analysis

Petitioner contends that respondent’s treatment of him

during the audit and Appeals process was unfair and harsh and has

resulted in the accrual of interest that should be abated. 

Petitioner’s general allegations of unfair treatment by the IRS

do not establish a ministerial error by respondent such that

interest accrued on petitioner’s deficiencies should be abated. 

During the trial petitioner’s testimony strayed repeatedly from

ministerial error to the underlying tax liability, which

petitioner himself accepted by signing the settlement documents. 
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Petitioner alleged that respondent failed to inform him that

he was not required to sign the Forms 872. Ms. Young testified

that she explained to petitioner and his representatives the

option of either signing the Forms 872 or having a notice of

deficiency issued. Regardless, all Forms 872 were sent to

petitioner before the effective date of section 6501(c)(4)(B),

which provides: “The Secretary shall notify the taxpayer of the

taxpayer’s right to refuse to extend the period of limitations,

or to limit such extension to particular issues or to a

particular period of time, on each occasion when the taxpayer is

requested to provide such consent.” Congress enacted section

6501(c)(4)(B) in 1998, and it is effective for requests for

consent to extend the period to assess tax made after December

31, 1999. Internal Revenue Service Restructuring and Reform Act

of 1998, Pub. L. 105-206, sec. 3461(b)(2), (c), 112 Stat. 764. 

Thus, section 6501(c)(4)(B) is inapplicable to the Forms 872

petitioner signed because respondent’s requests that petitioner

sign them were all made prior to December 31, 1999. 

Petitioner has not established an error or delay by

respondent in performing a ministerial act within the meaning of

section 6404(e) that would require abatement of interest. 

We conclude that respondent’s determination not to abate

interest was not arbitrary, capricious, or without sound basis in

fact or law. In reaching all of our holdings herein, we have
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considered all arguments made by the parties, and to the extent

not mentioned above, we find them to be irrelevant or without

merit.

To reflect the foregoing,

Decision will be entered

for respondent.