129 T.C. No. 7

UNITED STATES TAX COURT

ROBERT L. PERKINS, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 21997-04L. Filed September 13, 2007.

P timely filed his Federal income tax return for

2000 but failed to pay fully the amount reported as

due. R increased the Federal income tax liability

reported by P on his 2000 return and assessed the

increase pursuant to sec. 6213(b)(1), I.R.C. After

expiration of the period in which to request abatement

of the increased assessment under sec. 6213(b)(2),

I.R.C., P appealed the increase in a letter that was

forwarded to R's Office of Appeals.

While consideration by Appeals was pending, R

issued P a notice of intent to levy to collect the

outstanding liability for 2000. P timely requested a

hearing pursuant to sec. 6330(a)(3)(B), I.R.C. Before

a hearing was scheduled, R's Office of Appeals

responded to P's appeal of the increase in his 2000

liability, treating it as a claim for abatement and

denying it. Thereafter, the Appeals employee

conducting P's hearing under sec. 6330, I.R.C., did not

allow P to challenge the underlying tax liability on
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1 Unless otherwise indicated, all section references are to

the Internal Revenue Code of 1986, as amended.

the grounds that P's previous submission to R's Office

of Appeals constituted a prior opportunity to dispute

the liability under sec. 6330(c)(2)(B), I.R.C. A

notice of determination sustaining the proposed levy

was thereupon issued under the signature of the same

Appeals officer who had denied P's previous submission. 

P timely petitioned for review of the notice of

determination under sec. 6330(d), I.R.C.

Held: P did not have an "opportunity to dispute"

his underlying tax liability for 2000 within the

meaning of sec. 6330(c)(2)(B), I.R.C., by virtue of his

earlier request, still pending when the collection

action was initiated, for Appeals Office consideration

and abatement of the liability. Consequently, it was

error for the Appeals employee conducting P's hearing

under sec. 6330, I.R.C., to refuse to consider P's

challenges to the underlying tax liability, and P's

challenges are subject to de novo review in this Court.

Held, further, P's challenges to his underlying

tax liability are groundless. Accordingly, the refusal

to consider them at P's hearing was harmless error.

Held, further, the possibility that an Appeals

officer having "prior involvement" with respect to the

unpaid tax, within the meaning of sec. 6330(b)(3),

I.R.C., participated in the conduct of P's hearing is

not grounds for a remand in this case, since all of

petitioner's arguments against the collection action

were frivolous or groundless.

Robert L. Perkins, pro se.

James M. Klein, for respondent.

GALE, Judge: Pursuant to section 6330(d)(1),1 petitioner

seeks review of respondent's determination to proceed with a levy

to collect petitioner's Federal income tax liability for taxable
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2 Respondent's publication, "2000 Instructions for Form

1040", instructs taxpayers electing to use "mark-to-market"

accounting for securities held in connection with a trade or

business of trading securities to report gains and losses on Form

4797.

year 2000. We conclude that respondent may proceed with

collection.

FINDINGS OF FACT

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

The stipulation of facts and the accompanying exhibits are

incorporated herein by this reference. Petitioner resided in

Wisconsin when he filed the petition in this case. 

On April 16, 2001, petitioner timely filed his Federal

income tax return for 2000 on a Form 1040, U.S. Individual Income

Tax Return. Before doing so, he had received a publication from

respondent entitled "2000 Instructions for Form 1040" which

included a discussion of special rules for traders in securities. 

On line 13 of the Form 1040, "Capital gain or (loss)", petitioner

checked a box indicating that no Schedule D, Capital Gains and

Losses, was required and reported $55,778.28 in losses, which

offset ordinary income in that amount. As he indicated on the

Form 1040, petitioner did not attach a Schedule D. The Form 1040

did not include any election forms, any Schedules C, Profit or

Loss From Business, any Forms 4797, Sales of Business Property,2

or any statement to the effect that petitioner was a trader in

securities or was invoking section 475(f). Petitioner has not at
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3 See sec. 6213(b)(1). The letter was headed "We Changed

Your Return-You Have an Amount Due".

any time elected to have section 475(f) apply to the securities

he held in 2000. 

Respondent sent petitioner a letter dated July 12, 2001,

requesting that petitioner complete a Schedule D with information

to support his entry of $55,778.28 in losses on line 13 of the

Form 1040. Petitioner thereupon completed a Schedule D for 2000

and submitted it to respondent. Petitioner's Schedule D reported

net short-term capital losses of $55,778.28 and no long-term

capital gains or losses. 

Respondent subsequently sent petitioner a so-called math

error notice3 dated September 3, 2001, which stated: "We changed

your 2000 return. As a result of these changes, you owe

$30,965.64. * * * You figured your capital gains and losses on

Schedule D incorrectly." Respondent did not send a notice of

deficiency to petitioner for 2000. 

Petitioner responded to the math error notice by means of a

letter to respondent dated December 5, 2001, in which he

maintained that his 2000 return as originally filed was correct,

including the position that no Schedule D needed to be filed. In

response, respondent sent petitioner a Letter 105C dated March

20, 2002, advising of the disallowance of most of petitioner's

claimed $55,778.28 loss on the grounds that the loss was limited
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to $3,000. The letter provided instructions for the filing of an

appeal of the disallowance. Pursuant to the instructions,

petitioner appealed the disallowance in the Letter 105C by means

of a letter to respondent dated May 17, 2002, in which he offered

his reasons for disagreeing, including a declaration that his

statements were true under penalties of perjury (Appeals

request). 

On August 10, 2002, before responding to petitioner's

Appeals request, respondent sent petitioner a "Final Notice of

Intent to Levy and Notice of Your Right to a Hearing" (Notice of

Intent to Levy), notifying petitioner that respondent intended to

satisfy petitioner's outstanding 2000 tax liability by a levy,

and advising petitioner of his right to request a hearing. 

Petitioner timely requested a hearing on a Form 12153, Request

for a Collection Due Process Hearing, sent to respondent on

September 6, 2002. Petitioner's Form 12153 disputed both the

underlying tax liability and the "appropriateness of the

collection action", in light of the fact that consideration of

his Appeals request was still pending.

At some point, petitioner's Appeals request was referred to

and considered by respondent's Office of Appeals. On April 28,

2003, before any action was taken with respect to petitioner's

hearing request under section 6330, the Appeals Office issued

petitioner a written response to his Appeals request. Treating
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4 The parties have stipulated that petitioner did not file a

Form 1040X, Amended U.S. Individual Income Tax Return, for 2000. 

5 Insofar as the record discloses, petitioner did not file

suit in either court. However, on Mar. 22, 2004, petitioner

filed a petition for redetermination of a deficiency with this

Court. Petitioner's case arising from that petition was

dismissed for lack of jurisdiction on May 25, 2004. 

petitioner's Appeals request as a claim for abatement,4 the

Appeals Office denied it and advised petitioner that he could

pursue the matter further by filing suit in the U.S. District

Court or the U.S. Court of Federal Claims.5 The Appeals Office

response was signed by Timothy I. Gukich as "Appeals Team

Manager". 

On June 10, 2004, approximately 21 months after his request

for a hearing under section 6330 and more than 13 months after

denying his Appeals request, the Appeals Office sent a letter to

petitioner offering him the opportunity to schedule a section

6330 hearing. In accordance with petitioner's request, a hearing

was conducted via telephone by Settlement Officer Gwenda Dumas on

August 31 and October 5, 2004. Petitioner was not allowed to

raise challenges to the underlying tax liability during the

hearing. Respondent thereupon sent petitioner a "Notice of

Determination Concerning Collection Action(s) Under Section 6320

and/or 6330", with a Letter 3193 attached, dated October 15,

2004. The notice of determination was signed by Timothy I.

Gukich, "Appeals Team Manager", and concluded that it would be
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6 The notice did not address the issue raised by petitioner

in his hearing request concerning the appropriateness of

respondent's initiating a collection action when petitioner's

abatement request was pending before respondent’s Appeals Office.

appropriate for respondent to proceed with the proposed levy. 

The notice of determination reasoned that petitioner could not

challenge the underlying tax liability because he had received a

"prior opportunity to appeal."6

Petitioner timely petitioned the Court for review of

respondent's determination. 

OPINION

I. Background

Section 6331(a) authorizes the Secretary to levy upon

property and property rights of a taxpayer liable for taxes who

fails to pay those taxes within 10 days after notice and demand

for payment is made. Section 6331(d) provides that the levy

authorized in section 6331(a) may be made with respect to any

unpaid tax only if the Secretary has given written notice to the

taxpayer 30 days before levy. Section 6330(a) requires the

Secretary to send a written notice to the taxpayer of the amount

of the unpaid tax and of the taxpayer's right to a section 6330

hearing at least 30 days before any levy is begun.

If a section 6330 hearing is requested, the hearing is to be

conducted by an officer or employee of the Commissioner's Office

of Appeals who has had no prior involvement with respect to the
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unpaid taxes at issue before the hearing. Sec. 6330(b)(1), (3). 

The Appeals officer or employee shall at the hearing obtain

verification that the requirements of any applicable law or

administrative procedure have been met. Sec. 6330(c)(1). The

taxpayer may raise at the hearing "any relevant issue relating to

the unpaid tax or the proposed levy". Sec. 6330(c)(2)(A). The

taxpayer may also raise challenges to the existence or amount of

the underlying tax liability at a hearing if the taxpayer did not

receive a statutory notice of deficiency with respect to the

underlying tax liability or did not otherwise have an opportunity

to dispute that liability. Sec. 6330(c)(2)(B). A taxpayer is

treated as not having had an opportunity to dispute a liability

that is reported as due on a return. Montgomery v. Commissioner,

122 T.C. 1 (2004). An opportunity to dispute the underlying

liability that precludes a taxpayer from challenging it in a

section 6330 hearing includes a prior opportunity for a

conference with the Commissioner's Office of Appeals when the

taxpayer availed himself of that opportunity. Lewis v.

Commissioner, 128 T.C. 48, 61 (2007); see also sec. 301.6330-

1(e)(3), Q&A-E2, Proced. & Admin. Regs. 

At the conclusion of the hearing, the Appeals officer or

employee must determine whether and how to proceed with

collection and shall take into account (i) the verification that

the requirements of any applicable law or administrative
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7 Pursuant to the Pension Protection Act of 2006, Pub. L.

109-280, sec. 855(a), 120 Stat. 1019, this Court has jurisdiction

with respect to all determinations in sec. 6330 proceedings,

effective for determinations made after the date which is 60 days

after the Aug. 17, 2006 date of enactment, or Oct. 16, 2006.

procedure have been met; (ii) the relevant issues raised by the

taxpayer; (iii) challenges to the underlying tax liability by the

taxpayer, where permitted; and (iv) whether any proposed

collection action balances the need for the efficient collection

of taxes with the legitimate concern of the taxpayer that the

collection action be no more intrusive than necessary. Sec.

6330(c)(3).

With respect to determinations made before October 17,

2006,7 we have jurisdiction to review the Appeals Office's

determination where we have jurisdiction over the type of tax

involved in the case. Sec. 6330(d)(1)(A); see Iannone v.

Commissioner, 122 T.C. 287, 290 (2004). Generally, we may

consider only those issues that the taxpayer raised during the

section 6330 hearing. See sec. 301.6330-1(f)(2), Q&A-F5, Proced.

& Admin. Regs.; see also Magana v. Commissioner, 118 T.C. 488,

493 (2002). Where the underlying tax liability is properly at

issue, we review the determination de novo. E.g., Goza v.

Commissioner, 114 T.C. 176, 181-182 (2000). Where the underlying

tax liability is not at issue, we review the determination for

abuse of discretion. Id. at 182. Whether an abuse of

discretion has occurred depends upon whether the exercise of
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discretion is without sound basis in fact or law. See Freije v.

Commissioner, 125 T.C. 14, 23 (2005); Ansley-Sheppard-Burgess Co.

v. Commissioner, 104 T.C. 367, 371 (1995).

II. Challenges to the Underlying Liability

Petitioner's principal argument is that he did not receive

the hearing to which he was entitled under section 6330 because

the Appeals employee refused to consider challenges to the

underlying tax liability. Pursuant to section 6330(c)(2)(B), the

existence or amount of the underlying tax liability may be

challenged only if the taxpayer did not receive a statutory

notice of deficiency with respect to the underlying tax liability

or did not otherwise have an opportunity to dispute that

liability. 

No statutory notice of deficiency was sent to petitioner for

2000. The unpaid tax that respondent seeks to collect by levy

consists in part of an amount reported as due on petitioner's

return but unpaid, and an additional amount assessed by

respondent pursuant to the "math error" procedures under section

6213(b)(1).

The settlement officer did not permit petitioner to

challenge the underlying tax liability in connection with his

hearing, on the grounds that he had a prior opportunity to

dispute the liability within the meaning of section 6330(c)(2)(B)
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8 We are satisfied that respondent was entitled to make this

assessment under sec. 6213(b)(1). Petitioner's claimed

$55,778.28 capital loss constituted a "mathematical or clerical

error" within the meaning of sec. 6213(b)(1) because it was "an

entry on a return of a deduction * * * in an amount which exceeds

a statutory limit imposed by subtitle A [of Title 26]", which

limit "is expressed * * * as a specified monetary amount", and

"the items entering into the application of such limit appear on

such return". Sec. 6213(g)(2)(E). With regard to the last

requirement, we note that the Schedule D belatedly submitted by

petitioner disclosed to respondent that the claimed $55,778.28

(continued...)

by virtue of his making a submission to the Appeals Office in

response to the Letter 105C (i.e., petitioner’s Appeals request). 

A. Challenges to Self-Assessed Amount

A portion of the underlying tax liability was reported by

petitioner as due on his return. Under Montgomery v.

Commissioner, supra, petitioner was entitled to challenge that

portion of the liability. Petitioner’s earlier Appeals request

concerned only the liability arising from respondent's

disallowance of petitioner's claimed capital losses exceeding

$3,000. Thus, the Appeals employee's position that petitioner

was precluded from challenging any portion of the underlying

liability was erroneous. 

B. Challenges to Section 6213(b)(1) Assessment

The remaining portion of the underlying tax liability is

attributable to the additional assessment made by respondent

pursuant to section 6213(b)(1), resulting from the disallowance

of petitioner’s claimed capital losses in excess of the $3,000

capital loss limitation of section 1211(b).8 The notice of
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8(...continued)

loss arose from sales of capital assets and the extent of any

gains from such sales, thus triggering the $3,000 limit of sec.

1211(b). Nothing on the return or its accompanying schedules

indicated that petitioner had taken the position that he was

entitled to report his securities transactions under sec. 475(f),

as he apparently now claims in this proceeding. 

Petitioner would have been entitled to have the foregoing

"math error" assessment abated, and the proposed increase in his

2000 tax liability considered instead under the deficiency

procedures, if he had so requested within 60 days after the "math

error" notice was sent to him on Sept. 3, 2001. See sec.

6213(b)(2)(A). However, petitioner failed to do so within the

allotted 60 days; his letter disputing the "math error"

assessment was not sent until Dec. 5, 2001.

Respondent does not contend that petitioner's right to

invoke deficiency procedures with respect to the asserted

liability pursuant to sec. 6213(b)(2)(A) constituted "an

opportunity to dispute" the liability within the meaning of sec.

6330(c)(2)(B). We note in this regard that the "math error"

notice sent to petitioner nowhere disclosed to him his right to

deficiency procedures, let alone that such right was contingent

upon petitioner's making the request within 60 days. 

determination also concluded that petitioner was precluded from

challenging this portion of the underlying liability because of

the consideration by the Appeals Office of his Appeals request. 

The difficulty with this conclusion is that the Appeals Office

had not taken any action with respect to petitioner's Appeals

request when the Notice of Intent to Levy was issued to him.

Section 6330(c)(2)(B) states with respect to the right of a

person, whose property is subject to levy, to challenge the

underlying tax liability in a section 6330 hearing as follows:

(B) Underlying liability.--The person may also

raise at the hearing challenges to the existence or

amount of the underlying tax liability for any tax

period if the person did not receive any statutory

notice of deficiency for such tax liability or did not
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otherwise have an opportunity to dispute such tax

liability. [Emphasis added.]

The statute utilizes the past tense in reference to the

opportunity to dispute, indicating that Congress contemplated

that the dispute opportunity would have already transpired when

the hearing under section 6330 occurred. Respondent's

regulations confirm this interpretation: "An opportunity to

dispute a liability includes a prior opportunity for a conference 

with Appeals that was offered either before or after the

assessment of the liability." Sec. 301.6330-1(e)(3), Q&A-E2,

Proced. & Admin. Regs. (emphasis added). In upholding the

validity of this regulation recently, we concluded that "Congress

* * * intended to preclude taxpayers who were previously afforded

a conference with the Appeals Office from raising the underlying

liabilities again in a collection review hearing and before this

Court." Lewis v. Commissioner, supra at 61 (emphasis added).

Should the earlier Appeals conference opportunity be treated

as a prior opportunity where, as in this case, the requested

conference opportunity is not resolved by Appeals until after the

taxpayer has requested, but not received, a section 6330 hearing?

We conclude not, because to construe the statute in this manner

would consign to the Commissioner’s discretion whether the

underlying tax liability is subject to judicial review. The

Commissioner could cut off judicial review in these circumstances

by the simple expedient of processing the Appeals consideration
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of the liability outside section 6330 before offering the section

6330 hearing. If the requested section 6330 hearing were offered

first, a liability otherwise subject to challenge under section

6330(c)(2)(B) would also be subject to judicial review under

section 6330(d) upon the taxpayer's timely appeal. Conversely,

if Appeals consideration outside section 6330 proceeds first, the

consideration by Appeals operates to preclude a challenge to the

underlying liability in the 6330 hearing and any subsequent

judicial review. See Lewis v. Commissioner, supra at 60-61. 

That is precisely the position taken by respondent in this case.

In enacting what is commonly referred to as the "collection

due process" provisions of sections 6330 and 6320, Congress

intended to confer new rights upon taxpayers when the

Commissioner initiated collection actions against them,

including, in designated circumstances, judicial review of the

underlying tax liability. Montgomery v. Commissioner, 122 T.C.

at 13 (Laro, J., concurring); Davis v. Commissioner, 115 T.C. 35,

37 (2000); Offiler v. Commissioner, 114 T.C. 492, 495 (2000);

Goza v. Commissioner, 114 T.C. at 179-180. To construe section

6330(c)(2)(B) to preclude a challenge to, and judicial review of,

the underlying tax liability in the circumstances of this case

would circumscribe the right to judicial review that Congress

intended to extend to taxpayers against whom collection actions

have been initiated. We accordingly hold that petitioner did not
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9 We note in this regard that the same Appeals officer who

considered and denied any relief with respect to petitioner's

Appeals request also signed off on the notice of determination

which took the position that petitioner was precluded from

challenging the underlying liability in the sec. 6330 proceeding

because of “prior” Appeals consideration. 

have an “opportunity to dispute” the underlying tax liability

within the meaning of section 6330(c)(2)(B) by virtue of an

Appeals review that was not completed until after a hearing was

requested under section 6330. To hold otherwise would permit the

Commissioner to cut off a taxpayer's right to judicial review of

his challenge to the underlying tax liability by the simple

expedient of postponing the section 6330 hearing until after a

request for Appeals consideration, pending when the collection

action was initiated, was completed by Appeals.9 We therefore

conclude that the Appeals employee erred in refusing to consider

petitioner's challenge to the underlying tax liability;

petitioner's underlying liability was properly at issue in his

section 6330 hearing and is consequently subject to de novo

review in this Court. See, e.g., Goza v. Commissioner, supra at

181-182.

C. De Novo Review of Underlying Tax Liability

Having decided that petitioner was entitled to challenge his

underlying liability in the hearing and obtain judicial review

thereof, we proceed to consider de novo the merits of

petitioner's challenges. At trial, we gave petitioner an
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opportunity to raise any issue concerning the underlying

liability that he contended he would have raised at the hearing. 

1. Self-Assessed Amount

Petitioner has not addressed that portion of the underlying

liability reported as due on his return but unpaid, other than

his claim regarding the limitations period for assessment or

collection that we find to be without merit. See infra at

II.C.3. We therefore deem that portion conceded.

2. Section 6213(b)(1) Assessment: Claim Under Section

475(f)

As for the portion of the underlying liability attributable

to respondent's disallowance of petitioner's claimed capital

losses in excess of $3,000, petitioner contends that he is

entitled to the claimed losses on the "basis of being a day

trader". While section 475(f) allows persons engaged in a trade

or business as a trader in securities to treat the gain or loss

from such securities as ordinary income or loss (not subject to

the section 1211(b) limitation on recognition of capital losses),

see sec. 475(d)(3)(A)(i), (f)(1)(D), we are satisfied after a de

novo review of petitioner's claim that he has not shown

eligibility for treatment of his securities losses under section

475(f).

Section 475(f) allows ordinary gain or loss treatment in

conjunction with use of the mark-to-market method of accounting

for the securities used in the securities trader's trade or
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business. Sec. 475(f)(1)(A). A taxpayer must elect the

provision, however, no later than the due date (without regard to

extensions) for the return for the year immediately preceding the

election year. Rev. Proc. 99-17, sec. 5.03, 1999-1 C.B. 503,

504; Lehrer v. Commissioner, T.C. Memo. 2005-167; see also Knish

v. Commissioner, T.C. Memo. 2006-268. Petitioner admits that he

has made no such election at any time. Even if we were to treat

petitioner's averments in this proceeding as an attempt to elect

section 475(f) notwithstanding the requirements of Rev. Proc. 99-

17, supra, such an election, coming almost 5 years after the

close of the year at issue, would give petitioner an

impermissible benefit of hindsight. Compare Vines v.

Commissioner, 126 T.C. 279 (2006)(3-month-late section 475(f)

election permitted under section 301.9100-3, Proced. & Admin.

Regs., where taxpayer made no securities trades between

election's due date and its actual filing), with Knish v.

Commissioner, supra (6-month-late section 475(f) election made on

Form 3115, Application for Change in Accounting Method, was

ineffective); Lehrer v. Commissioner, supra (34-month-late

section 475(f) election made on amended Tax Court petition was

ineffective).

In addition to the absence of an election, petitioner

presented no evidence beyond his uncorroborated testimony that he

was engaged in a trade or business of trading securities. 
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Supporting the contrary conclusion is his 2000 return, which

contains no Schedule C for any trade or business. Finally, the

Schedule D submitted by petitioner, which documents the

securities sales giving rise to his claimed $55,778.28 loss,

demonstrates to our satisfaction that petitioner did not employ

mark-to-market accounting with respect to his securities. No

securities were marked to market as of yearend 2000.

In sum, petitioner's contention that he was entitled to

recognize a $55,778.28 loss in 2000 on account of his being a

"day trader" is groundless. Aside from his apparent reliance on

section 475(f), petitioner's remaining argument against the

application of the section 1211(b) limitation on his claimed

losses is that the restriction is unfair or inappropriate for

taxpayers in his circumstances and/or that the recognition of

capital losses should not be limited because the recognition of

capital gains is not. These arguments merit no discussion; the

applicability of section 1211(b) to taxpayers in petitioner's

circumstances is well established. See, e.g., Marrin v.

Commissioner, T.C. Memo. 1997-24, affd. 147 F.3d 147 (2d Cir.

1998); see also Acharya v. Commissioner, 225 Fed. Appx. 391 (7th

Cir. 2007); Jamie v. Commissioner, T.C. Memo. 2007-22.

3. Limitations Period Claims

Petitioner also asserted in his pretrial memorandum that the

periods for assessment and/or collection have expired with
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respect to the liability at issue. Assuming that petitioner

would have presented this issue if the Appeals employee had

permitted challenges to the underlying liability, the contention

is groundless. Generally, the amount of any tax imposed by the

Internal Revenue Code must be assessed within 3 years after the

return is filed. Sec. 6501(a). The liabilities at issue were

assessed in 2001, well within the 3 years after the filing of the

2000 return on April 16, 2001. The 10-year period of limitations

on collection commenced upon the assessments of the tax in 2001

and therefore does not expire until sometime in 2011. See sec.

6502(a).

III. Issues Other Than the Underlying Tax Liability

A. Section 6330(c)(1) Verification

Petitioner also argues, without citing any specifics, that

the Appeals employee conducting his section 6330 hearing failed

to satisfy section 6330(c)(1), which requires that the Appeals

officer obtain verification that the requirements of applicable

law or administrative procedure have been met. We disagree. The

notice of determination catalogues the investigation undertaken

by the Appeals employee to satisfy section 6330(c)(1), petitioner

cites no specific error, and we have likewise found no infirmity

in the process by which the liabilities at issue were assessed. 

A portion of the unpaid liability was assessed after being
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reported as due by petitioner, and the remainder was properly

assessed pursuant to section 6213(b)(1).

B. Appeals Officer's Prior Involvement

Finally, petitioner argues that his hearing failed to

satisfy the requirements of section 6330(b)(3), which provides

that the hearing "shall be conducted by an officer or employee

who has had no prior involvement with respect to the unpaid tax

specified in subsection (a)(3)(A) before the first hearing under

this section or section 6320." Section 301.6330-1(d)(2), A-D4,

Proced. & Admin. Regs., provides:

Prior involvement by an employee or officer of

Appeals includes participation or involvement in an

Appeals hearing (other than a CDP [collection due

process] hearing held under either section 6320 or

section 6330) that the taxpayer may have had with

respect to the tax and tax periods shown on the CDP

notice.

Given that he signed the April 28, 2003, Appeals letter denying

petitioner's Appeals request, we believe Appeals Team Manager

Gukich had prior involvement with respect to petitioner's 2000

unpaid tax. (The Appeals letter signed by Mr. Gukich preceded

petitioner's section 6330 hearing by approximately 16 months.)

Somewhat less clear is whether Mr. Gukich's signature as

Appeals Team Manager on the notice of determination demonstrates

that he participated in the "conduct" of petitioner's section

6330 hearing within the meaning of section 6330(b)(3). The

parties have stipulated that the hearing "was conducted via
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telephone by Settlement Officer Gwenda Dumas". Nonetheless, even

if we assume, without deciding, that Mr. Gukich participated in

the conduct of petitioner's hearing, it would not be grounds for

a remand in this case, because the arguments that petitioner has

raised against the collection action are all frivolous and

groundless. Thus, we conclude that, even if Mr. Gukich's

apparently supervisory role in issuing the notice of

determination were considered "conduct" of the hearing for

purposes of section 6330(b)(3), such participation by Mr. Gukich

could not have affected the outcome of the section 6330 hearing

and was therefore harmless error.

IV. Conclusion

Petitioner raised no other issues. Because we find that the

Appeals employees' refusal to allow petitioner to challenge the

underlying tax liability and Mr. Gukich's possible participation

in the conduct of the hearing after prior involvement would

constitute harmless error, we conclude that neither requires that

this case be remanded to Appeals for a further hearing; it would

not be "necessary or productive" to do so. See Lunsford v.

Commissioner, 117 T.C. 183, 189 (2001). Instead, we shall
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sustain respondent's determination to proceed with the levy. To

reflect the foregoing, 

Decision will be entered

for respondent.