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. 2002-203 

UNITED STATES TAX COURT

MICHAEL SCHAPER, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

 Docket No. 3049-02L. Filed August 13, 2002. 

 

Michael Schaper, pro se.

Alan J. Tomsic and Scott A. Hovey, for respondent.

MEMORANDUM OPINION

PANUTHOS, Chief 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
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dispute as to any material fact with respect to this levy action,

and that respondent’s determination to proceed with collection of

petitioner’s outstanding tax liability for 1997 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(a) and (b); 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

A. Petitioner’s Form 1040 for 1997

On or about September 10, 1998, Michael Schaper (petitioner)

and his wife, Roberta Schaper, submitted to respondent a Form

1040, U.S. Individual Income Tax Return, for the taxable year

1997. On the Form 1040, the Schapers listed their filing status

as “Married filing joint return”.

The Schapers entered zeros on applicable lines of the income

portion of their Form 1040, specifically including line 7 for

wages, line 22 for total income, and lines 32 and 33 for adjusted

gross income. The Schapers also entered a zero on line 53 for

total tax. The Schapers claimed an overpayment in the amount of

$2,065 related to Federal income tax withholding. The Schapers

attached to their Form 1040 a Form W-2, Wage and Tax Statement,

issued to petitioner by Viking Freight, Inc., disclosing that

petitioner was paid wages in the amount of $46,359.33 and that 

Federal income tax in the amount of $2,065.46 was withheld.

B. Respondent’s Deficiency Notice and Petitioner’s Response

On March 3, 2000, respondent issued a joint notice of

deficiency to the Schapers. In the notice, respondent determined

a deficiency in the amount of $4,736 in the Schapers’ Federal

income tax for 1997, an addition to tax under section 6651(a)(1)

in the amount of $667.75, and an accuracy-related penalty under

section 6662(a) for negligence or disregard of rules or
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2 In this regard, petitioner’s letter dated May 19, 2000,

stated in pertinent part: 

According to your “Deficiency Notice” of above

date (cover sheet attached), there is an alleged

deficiency with respect to my 1997 income tax 

* * * and if I wanted to “contest this deficiency

before making payment,” I must “file a petition with

the United States Tax Court.”

regulations in the amount of $534.20. The deficiency was based

principally on respondent’s determination that petitioner failed

to report the wage income as reported to respondent by Viking

Freight, Inc., on Form W-2.

By registered letter dated May 19, 2000, petitioner wrote to

the Director of respondent’s Service Center in Ogden, Utah,

acknowledging receipt of the notice of deficiency dated March 3,

2000, but challenging the Director’s authority “to send me the

Notice in the first place.” 

Petitioner knew that he had the right to contest

respondent’s deficiency determination by filing a petition for

redetermination with this Court.2 However, petitioner chose not

to do so. Accordingly, on August 7, 2000, respondent assessed

the determined deficiency, addition to tax, and accuracy-related

penalty, as well as statutory interest. On that same day,

respondent sent petitioner a notice of balance due, informing

petitioner that he had a liability for 1997 and requesting that

he pay it. Petitioner failed to do so.
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C. Respondent’s Final Notice and Petitioner’s Response

On November 16, 2000, respondent sent the Schapers a Final

Notice-–Notice of Intent to Levy and Notice of Your Right to a

Hearing (the Final Notice). The Final Notice was issued in

respect of the Schapers’ outstanding tax liability for 1997. 

On December 13, 2000, petitioner submitted to respondent a

Form 12153, Request for a Collection Due Process Hearing. 

Petitioner’s request stated that he was challenging the validity

of the assessments for 1997 on the grounds there is no statute

imposing tax liability upon him and he was not served with a

valid notice and demand for payment.

D. The Appeals Office Hearing

By letter dated May 9, 2001, the Appeals Office provided

petitioner with a transcript of his account for the taxable year

1997. On June 14, 2001, Appeals Officer Wiley Davis conducted an

Appeals Office hearing that petitioner attended. According to a

purported transcript of the hearing prepared by petitioner,

petitioner declined to discuss collection alternatives. Rather,

petitioner stated that he wished to challenge his underlying tax

liability, and he requested that the Appeals officer provide

verification that all applicable laws and administrative

procedures were followed in the assessment and collection

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

resided in Las Vegas, Nevada. The envelope bearing the petition

contains a timely U.S. Postal Service postmark dated Jan. 9,

2002. See secs. 6330(d)(1), 7502.

E. Respondent’s Notice of Determination

 On December 11, 2001, respondent sent petitioner a Notice

of Determination Concerning Collection Action(s) Under Section

6320 and/or 6330. The notice stated that the Appeals Office had

determined that it was appropriate for respondent to proceed with

the collection of petitioner’s outstanding tax liability for

1997. 

F. Petitioner’s Petition

On February 7, 2002, petitioner filed with the Court a

petition for lien or levy action seeking review of respondent’s

notice of determination.3 The petition includes allegations

that: (1) The Appeals officer failed to obtain verification from

the Secretary that the requirements of any applicable law or

administrative procedure were met as required under section

6330(c)(1); (2) petitioner never received a notice and demand for

payment or valid notice of deficiency; and (3) petitioner was

denied the opportunity to raise “relevant issues”.

G. Respondent’s Motion for Summary Judgment

As indicated, respondent filed a Motion For Summary Judgment

asserting that there is no dispute as to a material fact and that

respondent is entitled to judgment as a matter of law. In
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particular, respondent contends that because petitioner received

the notice of deficiency dated March 3, 2000, he cannot challenge

the existence or amount of his underlying tax liability for 1997

in this proceeding. Respondent further contends that the Appeals

officer’s review of a transcript of account with regard to

petitioner’s liability for 1997 satisfied the verification

requirement imposed under section 6330(c)(1) and demonstrates

that petitioner was issued a notice and demand for payment. 

Petitioner filed an objection to respondent’s motion. 

Thereafter, pursuant to notice, respondent’s motion was called

for hearing at the Court's motions session in Washington, D.C. 

Discussion

A. Statutory Framework

Section 6331(a) provides that if any person liable to pay

any tax neglects or refuses to pay such tax within 10 days after

notice and demand for payment, the Secretary is authorized to

collect such tax by levy on the person’s property. Section

6331(d) provides that at least 30 days before enforcing

collection by levy on the person's property, the Secretary is

obliged to provide the person with a final notice of intent to

levy, including notice of the administrative appeals available to

the person.

Section 6330 generally provides that the Commissioner cannot

proceed with collection by levy until the person has been given
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notice and the opportunity for an administrative review of the

matter (in the form of an Appeals Office hearing) and, if

dissatisfied, with judicial review of the administrative

determination. See Davis v. Commissioner, 115 T.C. 35, 37

(2000); Goza v. Commissioner, 114 T.C. 176, 179 (2000).

Section 6330(c) prescribes the matters that a person may

raise at an Appeals Office hearing. In sum, section 6330(c)

provides that a person may raise 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

and amount of the underlying tax liability can be contested at an

Appeals Office hearing only if the person did not receive a

notice of deficiency for the taxes in question or did not

otherwise have an earlier opportunity to dispute the tax

liability. See Sego v. Commissioner, 114 T.C. 604, 609 (2000); 

Goza v. Commissioner, supra. Section 6330(d) provides for

judicial review of the administrative determination in the Tax

Court or a Federal District Court, as may be appropriate.

B. Summary Judgment

Petitioner challenges the assessments made against him on

the ground that the notice of deficiency dated March 3, 2000, is

invalid. However, the record shows that petitioner received the

notice of deficiency and disregarded the opportunity to file a
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petition for redetermination with this Court. See sec. 6213(a). 

It follows that section 6330(c)(2)(B) generally bars petitioner

from challenging the existence or amount of his underlying tax

liability in this collection review proceeding.

Even if petitioner were permitted to challenge the validity

of the notice of deficiency, petitioner’s argument that the

notice is invalid because respondent’s Service Center director is

not properly authorized to issue notices of deficiency is

frivolous and groundless. See Nestor v. Commissioner, 118 T.C.

162, 165 (2002); Goza v. Commissioner, supra. Further, as the

Court of Appeals for the Fifth Circuit has remarked: "We perceive

no need to refute these arguments with somber reasoning and

copious citation of precedent; to do so might suggest that these

arguments have some colorable merit." Crain v. Commissioner, 737

F.2d 1417, 1417 (5th Cir. 1984). Suffice it to say that

petitioner is a taxpayer subject to the Federal income tax, see

secs. 1(a)(1), 7701(a)(1), (14), and that compensation for labor

or services rendered constitutes income subject to the Federal

income tax, sec. 61(a)(1); United States v. Romero, 640 F.2d

1014, 1016 (9th Cir. 1981).

We likewise reject petitioner’s argument that the Appeals

officer failed to obtain verification from the Secretary that the

requirements of all applicable laws and administrative procedures

were met as required by section 6330(c)(1). The record shows
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that the Appeals officer obtained and reviewed a transcript of

account with regard to petitioner’s taxable year 1997.

Federal tax assessments are formally recorded on a record of

assessment. Sec. 6203. “The summary record, through supporting

records, shall provide identification of the taxpayer, the

character of the liability assessed, the taxable period, if

applicable, and the amount of the assessment.” Sec. 301.6203-1,

Proced. & Admin. Regs.

Section 6330(c)(1) does not require the Commissioner to rely

on a particular document to satisfy the verification requirement

imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10

(2002); Weishan v. Commissioner, T.C. Memo. 2002-88; Lindsey v.

Commissioner, T.C. Memo. 2002-87; Tolotti v. Commissioner, T.C.

Memo. 2002-86; Duffield v. Commissioner, T.C. Memo. 2002-53;

Kuglin v. Commissioner, T.C. Memo. 2002-51. In this regard, we

observe that a transcript of account such as the one relied upon

by the Appeals officer in this case contains all the information

prescribed in section 301.6203-1, Proced. & Admin. Regs. See

Weishan v. Commissioner, supra; Lindsey v. Commissioner, supra;

Tolotti v. Commissioner, supra; Duffield v. Commissioner, supra;

Kuglin v. Commissioner, supra. 

 Petitioner has not alleged any irregularity in the

assessment procedure that would raise a question about the

validity of the assessments or the information contained in the
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transcript of account. See Davis v. Commissioner, supra at 41;

Mann v. Commissioner, T.C. Memo. 2002-48. Accordingly, we hold

that the Appeals officer satisfied the verification requirement

of section 6330(c)(1). Cf. Nicklaus v. Commissioner, 117 T.C.

117, 120-121 (2001).

Petitioner also contends that he never received a notice and

demand for payment for 1997. The requirement that the Secretary

issue a notice and demand for payment is set forth in section

6303(a), which provides in pertinent part:

SEC. 6303(a). General Rule.-–Where it is not

otherwise provided by this title, the Secretary shall,

as soon as practicable, and within 60 days, after the

making of an assessment of a tax pursuant to section

6203, give notice to each person liable for the unpaid

tax, stating the amount and demanding payment thereof. 

* * *

The transcript of account that the Appeals officer relied on

during the administrative process shows that respondent sent

petitioner a notice of balance due on the same date that

respondent made assessments against petitioner for the tax,

addition to tax, and accuracy-related penalty determined in the

notice of deficiency. A notice of balance due constitutes a

notice and demand for payment within the meaning of section

6303(a). See, e.g., Hughes v. United States, 953 F.2d 531, 536

(9th Cir. 1992); Weishan v. Commissioner, supra; see also Hansen

v. United States, 7 F.3d 137, 138 (9th Cir. 1993).
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Petitioner has 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). Under the

circumstances, we conclude that respondent is entitled to

judgment as a matter of law sustaining the notice of

determination dated December 11, 2001.

In order to give effect to the foregoing,

An appropriate order granting

respondent's motion and decision

for respondent will be entered.