1Section references are to the Internal Revenue Code of

1986, as amended.

T.C. Memo. 2009-258

UNITED STATES TAX COURT

WILLIAM R. GRANGER, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 4195-08L. Filed November 10, 2009.

William R. Granger, pro se.

Aaron D. Gregory, for respondent.

MEMORANDUM OPINION

PARIS, Judge: On January 15, 2008, respondent mailed to

petitioner a Notice of Determination Concerning Collection

Action(s) Under Section 6320 and/or 63301 (notice of

determination) for tax years 2002 and 2003. In response to that
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notice and pursuant to section 6330(d), petitioner timely

petitioned this Court for review of respondent’s determination

that petitioner was not entitled to a face-to-face collection due

process (CDP) hearing.

The issue for decision is whether the Appeals Office abused

its discretion in failing to grant petitioner a face-to-face CDP

hearing.

Background

On October 26, 2005, respondent mailed to petitioner a

notice of deficiency setting forth respondent’s determination of

petitioner’s income tax deficiency for tax year 2003. Petitioner

failed to petition the Tax Court with respect to the determined

deficiency within the 90-day period prescribed under section

6213. As such, respondent assessed the tax liability on April

24, 2006. Respondent also assessed a section 6702 civil penalty

against petitioner for tax year 2002 on December 12, 2005.

On April 28, 2007, respondent sent to petitioner a Notice of

Intent to Levy and Notice of Your Right to a Hearing advising

petitioner that respondent intended to levy on petitioner’s

assets to collect the unpaid liability for tax year 2003 along

with the section 6702 penalty for tax year 2002. The notice also

advised that petitioner could request a hearing with respondent’s

Office of Appeals. On May 24, 2007, petitioner timely submitted
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a Form 12153, Request for a Collection Due Process or Equivalent

Hearing, in which he requested a face-to-face CDP hearing. 

Respondent sent petitioner a letter dated June 23, 2007,

acknowledging respondent’s receipt of petitioner’s request for a

CDP hearing. In addition, respondent’s Office of Appeals sent

two letters to petitioner, each dated July 23, 2007,

acknowledging that Appeals had received the CDP case regarding

each tax year’s liability for consideration. 

On September 24, 2007, Settlement Officer Minnie Banks

(Settlement Officer Banks) sent petitioner a letter notifying him

that she had scheduled a telephone conference for October 23,

2007, to allow petitioner to discuss with her any relevant

challenges to the proposed levy action. This letter, in part,

also explained to petitioner that he was not entitled to a faceto-face CDP hearing because he was not in income tax return

filing compliance for tax year 2004. As such, the letter

requested that petitioner provide Settlement Officer Banks with a

signed tax return for 2004 along with a Form 433-A, Collection

Information Statement for Wage Earners and Self-Employed

Individuals, on or before October 16, 2007. The letter further

explained that collection alternatives could not be considered

without all requested information.

Petitioner sent Settlement Officer Banks a letter dated

October 12, 2007, along with attachments including a signed copy
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2Settlement Officer Banks further noted that petitioner had

not called to indicate that the CDP hearing conference was

scheduled at an inconvenient date or time.

of a Form 1040, U.S. Individual Income Tax Return, for tax year

2004. However, the letter did not include a completed Form 433-

A. During tax year 2004 petitioner worked for an entity known as

Titan Corporation. Although reflecting income tax withholdings

of $6,392.48, the signed copy of the 2004 Form 1040 reported zero

wages earned and zero adjusted gross income.

On October 23, 2007, Settlement Officer Banks sent

petitioner a letter indicating that petitioner had failed to call

her at the scheduled time for the telephone CDP hearing as

requested in her prior letter.2 This letter also explained that

the previously requested Form 433-A financial information was not

provided and that petitioner should provide any and all financial

information to Settlement Officer Banks for consideration on or

before November 6, 2007. 

On November 1, 2007, petitioner sent Settlement Officer

Banks a fax transmission where he, in part, “[restated] his

demand for a face-to-face hearing.” On December 9, 2007,

petitioner sent Settlement Officer Banks two separate fax

transmissions with attached documents including both a copy of

the letter he previously sent on November 1, 2007, along with the

signed Form 1040 for 2004 he previously provided. Petitioner

never provided the Form 433-A.
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3The sec. 6702 frivolous return penalty is assessed without

a notice of deficiency first being sent to the taxpayer, thus

generally depriving this Court of jurisdiction over the penalty. 

Sec. 6703(b).

On January 15, 2008, respondent’s Office of Appeals issued

to petitioner a notice of determination notifying petitioner that

the proposed levy action was sustained. On February 19, 2008,

petitioner, then residing in the Commonwealth of Virginia, filed

his petition with this Court.

Discussion

Jurisdiction To Review Frivolous Return Penalties

The Pension Protection Act of 2006 (PPA), Pub. L. 109-280,

sec. 855(a), 120 Stat. 1019, amended section 6330(d)(1), which

provides the Tax Court’s jurisdiction to review notices of

determination issued pursuant to section 6330, and gave the Tax

Court jurisdiction to review notices of determination issued

under section 6330 where the underlying tax liability consists of

section 6702 frivolous return penalties.3 Previously this

jurisdiction lay exclusively with the U.S. District Courts. See,

e.g., Johnson v. Commissioner, 117 T.C. 204, 208 (2001). The PPA

is effective for all determinations made after October 16, 2006. 

PPA sec. 855, 120 Stat. 1019. Even though a civil penalty for

tax year 2002 was first assessed on December 12, 2005,

respondent’s Office of Appeals issued to petitioner a final

notice of determination that included the penalty on January 15,
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4Under sec. 6330(c)(2)(B), a taxpayer may raise challenges

to the existence or amount of the underlying tax liability only

if the taxpayer did not receive any statutory notice of

deficiency for the tax liability, or did not otherwise have an

(continued...)

2008; thus, this Court has jurisdiction to review respondent’s

determination on the section 6702 penalty.

Collection Due Process Hearings 

Under section 6331(a), if a person liable for a tax fails to

pay it within 10 days after notice and demand, it is lawful for

the Secretary to “collect such tax * * * by levy upon all

property and rights to property * * * belonging to such person”. 

A taxpayer may appeal the filing of a notice of tax levy to the

Internal Revenue Service under section 6330 by requesting an

administrative hearing. The taxpayer is additionally afforded

the opportunity for judicial review of a determination sustaining

the notice of intent to levy in the Tax Court pursuant to section

6330(d). Petitioner seeks judicial review of respondent’s

determination. 

Petitioner never raised any issue regarding his underlying

tax liability during the Appeals process either for his 2002 or

2003 tax years, nor was there any evidence that petitioner

questioned the civil penalty assessed under section 6702 for tax

year 2002; thus, the Court may only review the determination to

see whether there has been an abuse of discretion by respondent’s

Appeals Office in the determination.4 See Lunsford v.
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4(...continued)

opportunity to dispute the tax liability. Petitioner did not

challenge the existence or amount of either his 2002 or 2003 tax

liabilities; therefore, the Court may only analyze whether the

Appeals officer abused his discretion.

Commissioner, 117 T.C. 183, 185 (2001) (citing Nicklaus v.

Commissioner, 117 T.C. 117, 120 (2001)). The Court has described

the standard by which respondent’s determinations are reviewed as

an “abuse of discretion”, meaning “arbitrary, capricious, clearly

unlawful, or without sound basis in fact or law.” Ewing v.

Commissioner, 122 T.C. 32, 39 (2004), revd. on other grounds 439

F.3d 1009 (9th Cir. 2006); see also Woodral v. Commissioner, 112

T.C. 19, 23 (1999). 

Petitioner contends that respondent erred in refusing to

grant him a “face-to-face” CDP hearing. However, under section

301.6330-1(d)(2), A-D6, Proced. & Admin. Regs., CDP hearings are

“informal in nature and do not require the Appeals officer or

employee and the taxpayer, or the taxpayer’s representative, to

hold a face-to-face meeting. A CDP hearing may, but is not

required to, consist of a face-to-face meeting”. Courts that

have considered the issue have found that a taxpayer does not

have a right to a face-to-face hearing. See O’Meara v. Waters,

464 F. Supp. 2d 474, 479–480 (D. Md. 2006) (holding that taxpayer

had received due process because he was given the opportunity to

participate in a telephone conference in which he discussed the

substance of his case with an Appeals officer); Turner v. United
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States, 372 F. Supp. 2d 1053, 1058 (S.D. Ohio 2005) (holding that

the Appeals Office did not violate the taxpayer’s right to a fair

hearing when it declined the taxpayer’s request for a face-toface hearing because it offered him a telephone conference or the

opportunity to submit his arguments in writing). 

Furthermore, respondent’s Appeals Office adequately

explained to petitioner that his request for a face-to-face

hearing was denied as a result of his not being in compliance

with his 2004 income tax return filing requirements. Section

301.6330-1(d)(2), A-D8, Proced. & Admin. Regs., states that 

a face-to-face CDP conference concerning a collection

alternative * * * will not be granted unless other taxpayers

would be eligible for the alternative in similar

circumstances. For example, because the IRS does not

consider offers to compromise from taxpayers who have not

filed required returns * * * no face-to-face conference will

be granted to a taxpayer who wishes to make an offer to

compromise but has not fulfilled [this obligation].* * *

Despite showing employment by an entity known as Titan Corp.

and Federal withholdings of $6,392.48, petitioner’s 2004 tax

return reported zero wages and zero adjusted gross income. It is

settled law that “any document which purports to be a federal

income-tax return * * * and which attempts to reduce one’s taxliability by excluding wages or salary from taxable-income * * *

is frivolous within the meaning of * * * [section] 6702(a)”. 

Beckelhimer v. United States, 623 F. Supp. 115, 116 (M.D. Tenn.

1985); see also Cabirac v. Commissioner, 120 T.C. 163, 169 (2003)

(noting that “The majority of courts, including this Court, have
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held that, generally, a return that contains only zeros is not a

valid return”).

Using the aforementioned standard of review, this Court does

not find that respondent’s Appeals Office abused its discretion. 

Respondent fully complied with the requirements of section 6330

by offering petitioner a telephone CDP hearing. Furthermore,

petitioner failed to produce the requested documents necessary

for respondent to consider collection alternatives in a face-toface CDP hearing.

Conclusion

Based on the record, the Court holds that the Appeals Office

did not abuse its discretion in determining that petitioner was

not entitled to a face-to-face CDP hearing.

Finally, in reaching the conclusions described herein, the

Court has considered all arguments made, and to the extent not

mentioned above, concludes they are moot, irrelevant, or without

merit. 

To reflect the foregoing,

Decision will be entered

for respondent.