TAX COURT OPINION

Case: Rita F. McGrath
Docket Number: 23303-14SL
Judge: Guy
Opinion Type: bench
Filed: 10/23/2015
Pages: 10

UNITED STATES TAX COURT WASHINGTON, DC 20217 MN RITA F. MCGRATH, Petitioner, v. ) ) ) ) Docket No. 23303-14SL. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) ORDER Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is ORDERED that the Clerk of the Court shall transmit herewith to petitioner and to respondent a copy of the pages of the transcript of the trial in the abovecaptioned case before Special Trial Judge Daniel A. Guy, Jr., at Philadelphia, Pennsylvania, on October 7, 2015, containing his oral findings of fact and opinion rendered at the trial session at which the case was heard. In accordance with the oral findings of fact and opinion, an appropriate decision will be entered. (Signed) Daniel A. Guy, Jr. Special Trial Judge Dated: Washington, D.C. October 23, 2015 SERVED Oct 23 2015 Capital Reporting Company 1 Bench Opinion by Special Trial Judge Daniel A. Guy, Jr. 3 2 October 7, 2015 3 Rita F. McGrath v. Commissioner 4 5 6 7 8 9 Docket No. 23303-14SL THE COURT: THE COURT HAS DECIDED TO RENDER ORAL FINDINGS OF FACT AND OPINION IN THIS CASE, AND THE FOLLOWING REPRESENTS THE COURT'S ORAL FINDINGS OF FACT AND OPINION. THE ORAL FINDINGS OF FACT AND OPINION SHALL NOT BE RELIED UPON AS PRECEDENT IN ANY ·10 OTHER CASE. 11 12 13 14 15 16 17 18 19 This proceeding for the review of a collection action is a small tax case conducted pursuant to the provisions of section 7463 of the Internal Revenue Code of 1986, as amended, and Rules 170 through 174 of the Tax Court Rules of Practice and Procedure. This bench opinion is made pursuant to the authority granted by section 7459(b) of the Internal Revenue Code of 1986, as amended, and Rule 152 of the 20 Tax Court Rules of Practice and Procedure. 21 Hereinafter in this bench opinion, section references 22 23 24 25 are to the Internal Revenue Code of 1986, as amended, in effect for 2010, and Rule references are to the Tax Court Rules of Practice and Procedure. This collection review case is before the 866.488.DEPO www.CapitalReportingCompany.cöm Capital Reporting Company 4 1 Court on Respondent's motion for summary judgment, 2 with a supporting declaration, filed pursuant to Rule 3 4 5 6 121 on August 3, 2015. By order dated August 11, 2015, Petitioner was directed to file a written response to Respondent's motion. She failed to do so. Respondent's motion was called for hearing in 7 Philadelphia, Pennsylvania, on October 6, 2015. No GT appearance was made by or on behalf of petition at DG the hearing. Kirsten E. Brimer appeared on behalf of 8 9 10. Respondent, 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Summary judgment serves to "expedite litigation and avoid unnecessary and expensive trials." Fla. Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988). Either party may move for summary judgment upon all or any part of the legal issues in controversy. Rule 121(a). The Court will grant summary judgment only "if the pleadings, answers to interrogatories, depositions, admissions, and any other acceptable materials, together with the affidavits or declarations, if any, show that there is no genuine dispute as to any material fact and that a decision may be rendered as a matter of law." Rule 121(a) and (b). Respondent's motion for summary judgment is well founded in the light of the averments therein, the pleadings, a declaration 866.488.DEPO www.CapitalReportingCompany.com Capital Reporti,ng Company .: 5 1 2 3 executed by the Settlement Officer Barbara Reynolds (SO Reynolds), and the administrative record. We conclude that there is no genuine dispute as to a 4 material fact and that Respondent is entitled to 5 6 7 8 9 10 judgment as a matter of law sustaining the notice of determination upon which this case is based. The following facts are not in dispute and are drawn from the pleadings and other documents constituting the record in this case. The record includes a transcript of ·: 11 Petitioner's account for the taxable year 2010 (the 12 13 14 15 16 17 18 year at issue). The Form 4340, Certificate of Assessments, Payments, and Other Specified Matters, shows that the Petitioner failed to file a federal income tax return for 2010. On December 4, 2012, Respondent prepared and filed a substitute for return in accordance with the provisions of section 6020 (b) . Thereafter, on March 19, 2013, Respondent mailed to 19 Petitioner a notice of deficiency for the taxable 20 21 22 23 24 25 year 2010. Respondent determined that Petitioner was liable for an income tax deficiency of $13,783 and additions to tax under section 6651(a)(1), 6651(a) (2), and 6654(a). Petitioner did not file a petition for redetermination with the Court challenging the notice of deficiency. On August 26, 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company . 6 1 2 3 4 5 6 2013, Respondent assessed the tax deficiency and additions to tax mentioned above, as well as statutory interest, and sent to·the Petitioner a notice of the balance due for 2010. Petitioner failed to remit payment of the amount due. On May 5, 2014, Respondent sent to 7 Petitioner a Final Notice of Intent to Levy and 8 Notice of Your Right to a Hearing regarding her 9 unpaid tax liabil,ity for 2010. Petitioner responded 10 11 by timely submitt in to the IRS Office of Appeals QG (Appeals Office) a Form 12153, Request for a 12 Collection Due Process or Equivalent Hearing, stating 13 that she was receiving treatment for a serious 14 medical condition and that she did not expect to be 15 16 17 18 19 20 21 22 23 24 25 able to return to work until later in the year. Petitioner's case was assigned within the Appeals Office to SO Reynolds. On July 18, 2014, SO Reynolds sent a letter to Petitioner stating that her administrative hearing would be conducted by way of a telephone conference call scheduled for August 19, 2014, and that before that date Petitioner was required to submit to the Appeals Office a Form 433- A, Collection Information Statement for Individuals, signed income tax returns for 2009 2011, 2012, and 6 2013, and proof that she was current in respect of 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 1 2 3 4 estimated tax payments for 2014. Petitioner did not submit to SO Reynolds the financial records and tax returns that she requested. On August 1, 2014, Petitioner left a 5 message for SO Reynolds requesting copies of any 6 7 Forms 1099 submitted to Respondent by third party payors for tax years 2009 through 2013. SO Reynolds 8 mailed these items to Petitioner. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SO Reynolds conducted Petitioner's administrative hearing by way of a telephonic conference call on August 19, 2014, as planned. At the time of the hearing, Petitioner stated that she wanted to enter into an installment agreement and indicated that she planned to file her delinquent tax returns once she had the necessary forms. In the absence of the requested financial information, however, SO Reynolds informed Petitioner that her case would be closed. On September 2, 2014, the Appeals Office issued to Petitioner a Notice of Determination Concerning Collection Action sustaining the proposed levy. On September 30, 2014, Petitioner filed with the Court a timely petition for review stating that she was continuing to receive medical treatment and did not expect to return to work until later in the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 year. 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 Commissioner is authorized to collect such tax by levy upon the person's property. Sec 6331(a). At least 30 days before enforcing collection by way of a levy on a person's property, the Commission s obliged to 06- provide the person with a final notice of intent to levy, including notice of available administrative appeals. Sec 6331(d). Generally speaking, the Commissioner cannot proceed with collection by levy 1. 2 3 4 5 6 7 8 9 10 11 12 13 until, (1) the person has been given notice and the 14 15 16 17 18 19 20 21 22 23 24 opportunity for administrative review of the matter (in the form of an Appeals Office hearing) and, if the person is dissatisfied, (2) judicial review of the administrative determination is final. Sec. 6330. See Davis v. Commissioner, 115 T. C. 35, 37 (2000) ; Goza v. Commissioner, 114 T.C. 176, 179 (2000) . In conducting administrative hearings in collection matters, the Appeals Office must verify that the requirements of any applicable law or administrative procedure have been met in processing the case. Sec. 6330(c)(1), (3)(A). The Appeals 25 Office also must consider any issues raised by the . 866.488.DEPO www.CapitalReportingCompany.com . Capital R porting Company 9 1 2 3 4 5 6 7 -.8 9 10 11 12 13 14 15 16 person relating to the unpaid tax or proposed levy, including offers of collection alternatives, appropriate spousal defenses, and challenges to the appropriateness of the collection action. Sec. 6330 (c) (2 ) (A), (3) (B) . A person may challenge the existence or amount of his underlying tax liability if the person did not receive a notice of deficiency or did not otherwise have an opportunity to dispute such tax liability. Sec. 6330 ( c) (2) (B) . Finally, the Appeals Office must consider whether the collection action balances the need for efficient collection against the person's concern that collection be no more intrusive than necessary. Sec. 6330(c)(3)(C). This Court has jurisdiction to review the administrative determination made by the Appeals 17 Office. Sec. 6330(d)(1). If the taxpayer's 18 19 20 21 22 23 24 25 underlying tax liability is not in dispute, as is the case here, we review the Appeals Office's administrative decision for abuse of discretion. Goza v. Commissioner, 114 T.C. 176 181-182 (2000). An abuse of discretion occurs if the Appeals Office exercises its discretion "arbitrarily, capriciously, or without sound basis in fact or law." Woodral v. Commissioner, 112 T.C. 19, 23 (1999). 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company . . . .. 10 1 Petitioner has not asserted at any stage of 2- these proceedings that she did not receive the notice 3 4 5 6 J 8 9 10 11 12 of deficiency for 2010 when it was mailed to her. It follows as a matter of law that Petitioner is barred . under section 6330(c)(2)(B) from challenging the existence or amount of her tax liability for 2010 in . this proceeding. Additionally, Petitioner failed to file tax returns for the taxable years before and after the year at issue and she failed to provide the financial information that SO Reynolds needed to evaluate whether she qualified for an installment agreement or other collection alternative. See e.g., 13 Olsen v. United States, 414 F.3d 144 153-154 (1st pCr pc- . 14 Cir. 2005) (no abuse of discretion in rejecting an 15 16 17 18 19 20 21 offer-in-compromise when the taxpayer failed to provide requested financial information for consideration at the administrative hearing); P ugh v. Commissioner, 135 T.C. 344, 351 (2010). We conclude on this record that SO Reynolds properly verified that the requirements of all applicable laws and administrative procedures were (cid:16)042 22 met in the processing of Petitioner's case, secpéen 23 24 25 6330(c)(1), and that the proposed levy fairly balances the Government's need for efficient collection of taxes with the Petitioner's concerns 866.488.DEPO www.Capita1ReportingCompany.com Capital Reporting Company that the collection action be no more intrusive than necessary, sec,td6330 (c) (3) (C) . In sum, we DC conclude that the Appeals Office did not abuse its discretion in this case and that Respondent is entitled to judgment as a matter of law sustaining the notice of determination upon which this case is based. This concludes the Court's oral findings of fact and opinion. (Whereupon, at 9:59 a.m., the above- entitled matter was concluded.) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 866.488.DEPO www.Capita1ReportingCompany.com