TAX COURT OPINION

Case: Michael Blake
Docket Number: 336-11SL
Judge: Whalen
Opinion Type: bench
Filed: 02/21/2012
Pages: 10

UNITED STATES TAX COURT WASHINGTON, DC 20217 MICHAEL BLAKE, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent. . ) ) ) ) ) Docket No. 336-11S L ) ) ) ) ) ORDE R 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 proceedings in thë above case before the undersigned at Seattle, Washington, containing oral findings of fact and opinion rendered on January 27, 2012. In accordance with the oral findings of façt and opinion, an appropriate order and decision will be entered. (Signed) Laurence J. Whalen Judge Dated: Washington, D.C. February 21, 2012 SâRVEo FEB 2 8 2012 BENCH OPINION BY SENIOR JUDGE LAURENCE . J. WHALEN 3 MICHAEL -BLAKE V. COMMISSIONER DOCKET NO. : 336-11SL JANUARY 27, 2012 THE COURT: The Court has decided to render oral findings of fact arid opinion in this case and the following represents the Court's oral findings of fact and opinion. II. This proceeding is a levy action that was brought pursuant to sections 6330 (d) and 7463 (f) (2) of the Internal Revenue Code of 1986, as amended. This proceeding was also brought pursuant to Rules 33D through .334, and Rules 170 through 175 of the Tax 1 2 3 4 6 7 8 9 10 li 12 13 14 15 16' Court Rules of Practice and Procedure . In this bench 17 18 19 20 21 22 23 24 25 opinion 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 . The decision to be entered in this case 1s not reviewable by .any other court, and this opinion should not be cited as authority. Sec . 7463 (b) . III. This bench opinion is made pursuant to the authority granted by section 7459(b) and Rule 152. Heritage Reporting Corporation (202) 62814888 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 IV. Mr. Michael Blake appeared in these proceedings on his own behalf and William D. Richard, Esquire, appeared on behalf of respondent. Vm. This matter is before the Court on Respondent's Motion For Summary Judgement, filed November 25, 2011. The facts relevant to the proper disposition öf respondent's.motion are as(cid:16)042follows: On February 8, 2010", respondent mailed to petitioner a Final Notice-Notice: of Intent to Levy and Notice of Your Right to a Hearing in which . respondent proposed to ,use levy to collect- petitioner's unpaid income tax liability for taxable year· 2008. Thereafter, on or about March 1, 2010, respondent" received petitioner's Request for a Collection Due Process or Equivalent Hearing filed on IRS Form 12153 . Petitioner' s Form 12153 suggests that he disagreed with the levy action because he wanted a collection alternative in the; form of an installment agreement to be used: It appears that petitioner already had an installment agreement with the Commissioner. For that reason, a representative of the Commissioner wrote to Heritage Reporting Corporation (202) 628-4888 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 5 petitioner on August 9, 2010, and advised him that the outstanding installment agreement had been "re- established".to include taxable ·year 2008. The representative suggested that, because the Internal Revenue Service had already addressed the issue raised in the request for a collection due process hearing, petitioner had the option of withdrawing his hearing request. Petitioner chose not to withdraw his request for a hearing, and, in due course, an Account Resolution Specialist of the Appeals Office, who is referred to herein simply as '"specialist," sent petitioner an introductory.letter dated September 17, 2010. Thereafter, on September 27, 2010, the specialist sent a letter th petitioner proposing a . telephone hearing on October 21, 2010, and asking petitioner to contact her by October 14, 2010, if the proposed time was inconvenient, or if he wished a hearing in person or by correspondence. In view of the fact that petitioner already had an installment agreement, the specialist also noted in the letter, that no other alternative collection option could be .offered to him, and that he. could withdraw his request for a hearing. Petitioner notified the specialist on Heritage Reporting Corporation (202) 628-4888 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 October 14, 2010, by facsimile letter that he might not be available for the hearing because, on that day, he .was "on call with the School District." Apparently, - this turned out to be the case because on October 21, 2010, petitioner did not contact the specialist, and she was unable to reach petitioner by telephone. The specialist wrote to petitioner on that date and confirmed the :fact that they had not spoken She . also noted that he might .no longer want a collection due process hearing because he already had an installment agreement. She asked petitioner to call her by November 9, 2010, if this were the case. The specialist also stated that, if he did not want to . withdraw his request for a hearing, then her office would make a determination based upon the information! already submitted. In response to the specialist's letter, petitioner telephoned her on October 26, 2010, and the hearing was conducted at that time. Petitioner stated that he was unable to make payments under the existing installment agreement because; his hours had been reduced. The specialist asked petitioner to submit a Form 433-A, Collection Information Statement, bank statements, and wage statements for the last two months . This information would permit the specialist . Heritage Reporting Corporation (202) 628-4888 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 7 to determine if petitioner's account should be treated as currently non-collectible. By letter dated October 26, 2010, the specialist sent petitioner a blank Form 433-A, Collection Information Statement, which she asked him to complete and return to her by November 12, 2010. Petitioner never submitted the information requested by the specialist to evaluate his claim that he was unable to make payments under the installment agreement. Accordingly, the specialist issued the subject Notice of Determination which sustained the use of levy to collect petitioner's income tax liability for taxable year 2008. . The Petition Petitioner s petition states the following as the reason why he disagrees with the IRS determination: "I believe the IRS is wrong concerning collection actions failing to do so may result in denial and such abstracted analysis of the problem along with.estimates of costs, levies and submitted financial information (required attachment of form 433-a October 26, 2010) . Together with a . time schedule for acquisition or attachment Heritage Reporting Corporation (202).628-4888 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 8 in operating in making such determination. The control agency.should afford myself opportunity ·for a rules (aggrieved action) hearing." While the above is not entirely clear, it appears that petitioner may be objecting to the request, made in the specialist's.letter of October 26, 2010, that he submit a Form 433-Á, Collection Information Statement to evalua.te his statement that he was unable to pay the existing installment agreement. Respondent's Motion forjSummary Judgment Respondent's motion recites the above facts and emphasizes that petitioner failed to provide a completed Collection Information Statement on Form 433,A, that was requésted by the specialist. Respondent's motion notes that the validity of the underlying tax liability is not before the Court and, thus, the standard for reviewing the action of the specialist is abuse of discretion. See, e.g., Goza v. Commissioner, 114 T.C.·176 (2000). Based on that standard, respondent.argues that there is no genuine issue of material fact for trial.and respondent is entitled to decision as a matter of law because the specialist had considered all.of the matters required by section 6330 (c), such as spousal defenses, Heritage Reporting Corporation (202). 628-4888 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 challenges to the appropriateness of the proposed collection action, and áffers of collection alternatives. VI. 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 12 i (a) and (b) . Because the underlying tax liability is not at(cid:16)042issue,our review under section 6330 is for abuse of discretion. See Sego v. Commissioner, 114 T. C. 604, 610 (2000); Goza v. Commissioner, 114 T.C. 176, 182 (2000) . This standard does not ask us to decide whether in our own opinion petitioner's offer-in- compromise should have been acäepted. Under this standard, the question is whether the action of respondent' s specialist sustaining the levy was arbitrary, capricious, or without sound basis in fact Heritage Reporting Corporation (202) 628-4888 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 10 or law. Seé Woodral v. Commissioner, 112 T. C. 19, 23 (1999); Keller v. Commissióner, T.C. Memo. 2006-166; Fowler v. . Commissioner, T . C. Memo . 20 04-163 . VII. We do not believe thát the action of respondent's specialist, approving the levy as an appropriate collection device, was arbitrary, capricious, or without sound basis in .fact or law: It was reasonable for the specialist to request petitioner to submit a Form 433-A,. Collection Information Statement, in order to evaluate his statements, made during the collection due process he,aring, that his hours had been cùt back and that he had defaulted on the outstanding installment agreement. Petitioner did not make a timely response to the specialist's request for this information, and in view of the outstanding iristallment agreement, there was no collection alternative for the specialist to consider before issuing the Notice of Determination. Based upon the information available to thë specialist, the determination to sustain the levy was reasonable . VIII. For the foregoing reasons, we hereby sustain the notice of determination dated December 10, 2010, Heritage Repórting Corporation (202) 62.8 4888 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 11 that was issued to petitioner approving the use of levy to collect petitioner's tax liability for 2008. IX. This concludes the court's oral findings of fact and opinion in this case. . (W.hereupon, at 9:32 a.m., the bench opinion in the above-entitled matter was concluded. ) // // // // // // // // // // // // // // Heritage Reporting Corporation (202) 628·-4888