N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
LEONAR

D L. B EST a

n d EVELYN R
. B EST, Pe t i tione rs-Appe lla nts,
v. C OM M ISSIONER

OF INTER

NAL R EVENUE, R e sponde nt-Appe lle e . No. 16-71777 Ta x C t. No. 26662-10 L
M EM O R ANDUM *

HOW ARD E. M AY; e t a l.,

Pe t i tione rs-Appe lla

nts,
v. C OM M ISSIONER

OF INTER

NAL R EVENUE, R e sponde nt-Appe lle e . No. 16-72186 Ta x C t. No. 14545-12

Appe a l from

a De c ision of the Unite d Stat e s Tax C ourt 

# FIL ED
N OV 16 2017 M OLLY C. DW Y ER, CLERK U

. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t ion a

nd is not pre c e de nt e xc e pt a s provide d

by Ninth C irc uit R

ule 36-3.Subm itte d Nove m b e r 14, 2017 ** San Fran c isc o , C a lifornia B e fore : THOM AS, C hie f C irc uit Judge , PAEZ, C irc uit Judge , a nd SAVAGE, *** Distric t Judge
. In this c onsolida

t e d a ppe a l, ta xpa y e rs Le ona

rd L. B e st, Eve ly

n R
. B e st, Howa rd E. M ay , the Esta

te of Judith A. M ay , a

nd pe rsona l re p re se ntative M arc ia M . M a y (“ T a xpa y e rs” ) a ppe a l the Ta x C ourt’ s de c ision upholding propose d le vie s to c o lle c t unpa id fe d e ra l inc o m e tax lia b ilitie s a nd upholding pe

na ltie s pursua

nt to 26 U.S.C . § 6673(a )(1). W e have jurisdic tion pursua nt to 26 U.S.C . § 7482(a )(1),
and we a ffirm . B e c a

use the pa rtie s a re fam ilia r with the history

of this c a se , we
ne e d not re c o unt it he re . I The Ta x C ourt did not err in susta ining le vie s to c olle c t Taxpa y e rs’ de linque nt ta

xe s. Taxpa

y e rs re que ste d c olle c tion due proc e ss he a rings whe n

IR S notifie d the m

tha t the le vie s would beim

pose d. Se e 26 U.S.C . § 6330(b). During the h e arings, the IR S Appe a ls Offic e a ppropria t e ly ve rifie d “ that the re quire m e nts of any a p plic a ble la w or a dm i nistra

tive proc e d

ure ha [d] be e n m e t.”

* * The pa

ne l una nim ously c onc lude s this c a se is suita ble for de c ision without ora l a

rgum e nt. Se e Fe d. R . App. P. 34(a )(2).

* * * The Honora

ble Tim othy

J. Sa va ge , Unite d

State s Distric t Judge for the E a s te rn Distric t of Pe nnsy lva nia , sitting by

de s igna tion. 2§ 6330(c )(2)(A). B e c a use the y a lre a dy ha d be e n a fforde d a

n opportunity

to c onte st lia bility , Ta xpa

y e rs we re not e ntitle d to do so following notific a tion of thele vie s. § 6330(c )(2)(B ). Furthe r, Ta xpa y e rs a gre e d to the ir unde rly ing lia bility in both
c a se s. Taxpa

y e rs’ argum e nts a ga inst sustaining thele vie s a re unsupporte d by

la w or fa c t. II The IR S Appe a ls Offic e did not e rr in produc i ng only Ta xpa y e rs’ a c c ount transc ripts during the ir c olle c tion due proc e ss he arings. Unde r 26 C .F.R
. § 301.6203-1, a

taxpa y e r is e ntitle d to “ the pe rtine nt pa rts of the a sse ssm e nt whic h
se t forth the nam e of the taxpa y e r, the date of a sse ssm e nt, the c ha ra c te r of the lia bility a sse sse d, the taxa

ble pe riod, if a

pplic a ble , a n d the am ounts a sse sse d.” This re gula

tion is “ a p e rm issibleinte rpre tation of [26 U.S.C .§] 6203, a nd we are the re fore bound to give

it de fe re nc e . ” K

off v . Unite d State

s , 3 F.3d 1297, 1298 (9th C ir. 1993). W

h e n Taxpa

y e rs re c e ive d

the ir a c c ount tra

nsc ripts, the y

re c e ive d

“ the pe rtine nt pa

rts of the a sse s sm e nt.” 26 C .F.R . § 301.6203-1. Additiona lly , the taxpa

y e rs' subse que nt re c e ipt of theForm s 4340 prior to tria l in the Ta x C o urt fulfille d the C o m m i ssione r's se c tion 6203 obliga tion to furnish ta xpa y e rs with c opie s of the IR S re c ords of a sse ssm e nt. Form 4340 is suffic i e nt to show tha

t the a sse ssm e nts we re prope r. K o ff , 3 F.3d a t 1297.
3Nor wa s the Appe a ls Offic e re quire d to provideTa xpa y e rs with a

spe c ific , signe d de le gation orde r for the Form s 4340. The re is no re quire m e nt unde r IR S la ws or re gula

tions tha t the taxpa y e r re c e ive a

c opy of the de le gation of a

uthority orde r from

the Se c re ta

ry to the pe rson who signe d the ve rific a tion re quire d unde r
se c t ion 6330(c )(1). III The Ta x C ourt did not a

buse its disc re tion in im

posing pe na ltie s unde r 26 U.S.C . § 6673(a )(1)(B ). Ta xpa y e rs m a inta ine d “ frivolous or groundle s s” positions whe n the y

argue d tha

t the y we re e ntitle d to re c e ive pa rtic ula r doc um e n ts. 26 U.S.C . § 6673(a )(1)(B ). C onsiste nt with K off , 3 F.3d 1297, IR S ha s re a sona bly
c la ssifie d the se positions a s frivolous. Se e R e v. R ul. 2007-21, 2007-1 C .B . 865; IR S Notic e 2010-33, 2010-17 I.R .C . 609. B e c a use § 6673(a )(1)(B ) is indiffe re nt to
a taxpa y e r’ s sta te of m i nd, Taxpa

y e rs c annot e sc a

pe pe n a lty

by a dva nc ing a de fe nse of good fa ith re lia n c e on c ounse l.

AFFIRM E D.

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