TAX COURT OPINION

Case: Phillip John Procario
Docket Number: 24034-07S
Judge: Colvin
Opinion Type: bench
Filed: 07/15/2008
Pages: 9

UNITED STATES TAX COURT WASHINGTON , DC 2021 7 PHILLIP JOHN PROCARIO, Petitione r v . ) Docket No . 24034-07S . COMMISSIONER OF INTERNAL REVENUE , Respondent O R D E R Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it i s 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 hearing in the above case before Judge Robert P . Ruwe at Cleveland, Ohio, on June 16, 2008, containing his oral findings of fact and opinion rendered at'the conclusion of the trial . In accordance with the oral findings of fact and opinion, an appropriate order and decision will be entered . (Signed ) Robert P. Ruwe Judg e Dated : Washington, D .C . July 15, 2008 SERVED JUL 16 2008 3 1 Bench Opinion by Senior Judge Robert P . Ruwe 2 June 18, 200 8 3 Phillip John Procario 24034-07 S 4 5 The Court has decided to render Oral Findings of 6 Fact and Opinion in this case and the following represent s 7 the Court's Oral Findings of Fact and Opinion . This Opinion 8 shall not be relied upon as precedent in any other case . 9 The Court' s opinion with respect to Respondent's 10 motion for summary judgement , pursuant to Tax Court Rule 121 11 is as follows . 12 Petitioner filed his petition contestin g 13 Respondent ' s notice of determination to proceed by levy to 14 collect Petitioner's unpaid income tax liabilities for the 15 years 2001 , 2002, 2003 and 2004 . 16 Petitioner failed to file federal income ta x 17 returns for his 2001through 2004 taxable years . Notices of 18 deficiency were issued to Petitioner determining liabilities 19 for the years in issue . Petitioner did not file a petition 20 with respect to the notices of deficiency . 21 Respondent assessed the amounts shown on the 22 notice #deficiency . Respondent mailed to Petitioner a A 23 letter 1058, Final Notice of Intent to Levy, and Notice of 24 Your Right to a Hearing . 25 Petitioner filed a Form 12153 , Request for Heritage Reporting Corporatio n (202) 628-4888 0 4 1 Collection Due Process Hearing . The Petitioner's arguments 2 in his request for a CDP hearing were frivolous . Petitioner 3 claimed that there is no statute under sub-title A of the 4 Internal Revenue Code that imposes a tax liability on him, 5 that he has no return filing requirements, that he is not a 6 "taxpayer" as defined under Section 7701(a)(14), and that in 7 the absence of a filed return the IRS has no authority t o 8 assess a tax liability against him . 9 In a letter dated July 19, 2007, Respondent' s 10 appeals office informed Petitioner' that it does not provide 11 face-to-face hearings if the only items the taxpayer wishes 12 to discuss are frivolous . Appeals scheduled a telephone 13 conference for August 9, 2007, in that letter . 14 Petitioner failed to call the appeals office at 15 the scheduled time and date or to inform the appeals office 16 if the scheduled time and date were inconvenient . 17 On September 13, 2007, Respondent's appeals office 18 issued to Petitioner a notice of determination concernin g 19 collection action under Section 6320 and/or 6330 . This is 20 the notice of determination . 21 Petitioner filed a timely petition with regard to 22 the notice of determination . In his petition, Petitioner 23 argued that appeals improperly denied a face-to-face CD P 24 hearing which he alleged is guaranteed under the regulations 25 and that Petitioner has not been shown that IRS has met all Heritage Reporting Corporatio n (202) 628-4888 5 1 of the requirements of applicable law and administrative 2 procedures . 3 Section 6330 provides for notice and opportunity 4 for a hearing before the Commissioner may levy upon th e 5 property of any person . At the hearing, the person may 6 raise any relevant issue relating to the unpaid tax o r 7 proposed levy, including challenges to the appropriateness 8 of the collection action and offers of collection 9 alternatives . 10 The person may challenge the existence or amount 11 of the underlying tax liability for any period only if the 12 person did not receive the notice of deficiency and did not 13 otherwise have an opportunity to dispute the liability . 14 Once appeals issues a notice of determination, the 15 person may seek judicial review in this Court . Unless the 16 validity of the underlying tax liability is properly a t 17 issue, we review the determination of the appeals office for 18 abuse of discretion . 19 The validity of the underlying tax liability is 20 not properly at issue in this case because Petitione r 21 received notices of deficiency for the years at issue and 22 failed to dispute the liability at that time . Thus, issues 23 raised by Petitioner relating to the underlying ta x 24 liability are not reviewable here . 25 Petitioner argues that the appeals office was Heritage Reporting Corporation (202) 628-4888 6 1 required to provide him with , and he should have received, a 2 face-to-face hearing . 3 Hearings conducted under Section 6330 are informal 4 proceedings and do not invariably require a face-to-fac e 5 meeting . The hearing may, in certain circumstances, be 6 conducted by telephone or correspondence . 7 Once the taxpayer has been given a reasonabl e opportunity for a hearing but has failed to avail himself o f 9 that opportunity, the appeals officer may proceed in makin g 10 a determination by reviewing the case file . 11 Petitioner was given an opportunity for a hearing 12 and failed to avail himself of that opportunity . Therefore, 13 Respondent properly made a determination . 14 The other issue raised in the petition is that the 15 IRS has not shown that it met all requirements of law an d 16 administrative procedures . 17 Petitioner alleges that the appeals officer failed 18 to provide him verification from the Secretary that the 19 requirements of all applicable laws and administrative 20 procedures were met . 21 Section 6330 ( c)(1) does not require the appeals 22 officer to rely upon a particular document in making these 23 determinations . Nor does it mandate that the appeal s 24 officer actually give the taxpayer a copy of the 25 verification upon which the appeals officer relied . Heritage Reporting Corporatio n (202) 628-4888 7 1 Petitioner has not demonstrated in this proceeding 2 any irregularity in the assessment procedures that woul d 3 raise a question about the validity of the assessment or the 4 information that the appeals officer relied upon . Indeed , 5 Petitioner failed to even participate in the hearing 6 process . 7 Issues raised by Petitioner throughout thi s 8 proceeding have been frivolous . To refute these arguments 9 with somber reasoning and copious citation of preceden t 10 might suggest that these arguments have some colorable 11 merit . In light of Petitioner's failure to identify any 12 legitimate issue, it is unnecessary and would b e 13 unproductive to remand this case for any further proceedings 14 by an appeals officer on account of a lack of a face-to-face 15 hearing . 16 Petitioner has offered no collection alternatives 17 and asserted no spousal defenses . On the basis of ou r 18 examination of the entire record we conclude and hold that 19 Respondent's appeals officer did not abuse his discretion in 20 determining to proceed with the collection action a s 21 determined in the notice of determination . 22 Accordingly, we will grant Respondent's motion for 23 summary judgment to the extent that it request; ehpa~ we allo w 24 the collection action determined in the notice of 25 determination to proceed . Heritage Reporting Corporation (202) 628-4888 8 1 In Respondent ' s motion fpr summary judgment , 2 Respondent requests that the Court impose a penalty pursuant 3 to Section 6673 . Section 6673 authorizes the Court t o 4 require a taxpayer to pay to the United States a penalty not 5 in excess of $25,000 whenever it appears that proceeding s 6 have been instituted or maintained by the taxpayer primarily 7 for delay or that the taxpayer's position in suc h 8 proceedings is frivolous and groundless . 9 Petitioner ' s positions in this proceeding ar e 10 frivolous and groundless . However , we have determined not 11 to impose the penalty pursuant to Section 6673 . We note 12 that several days prior to the day this case was to b e 13 heard, Petitioner sent to the Court what was captioned as a 14 Supplement to Petition , asking that his previous claims be 15 withdrawn and that he be allowed to make what h e 16 characterized as non-frivolous claims . 17 What he submitted as a supplement to petition was 18 not filed and the matter was raised at the oral hearing on 19 the motion for summary judgment . The Court denied 20 Petitioner ' s oral motion for leave to file an amendment to 21 his petition . Therefore , the supplement to petition has not 22 been filed , although it has been lodged with the Court . 23 Our reason for not imposing the Section 667 3 24 penalty here is that the latest submission by the Petitioner 25 indicates that he might now recognize that his positions Heritage Reporting Corporatio n (202) 628-4888 9 1 thus far have been frivolous . However, he has come forward 2 with nothing, including anything in the most recen t 3 submission that would indicate that he has any legitimat e 4 claim to contest the notice of determination to proceed with 5 collection . 6 Nevertheless, in the hope that Petitioner 7 recognizes the fact that his previous positions ar e 8 frivolous and will not pursue them again, we will decline to 9 impose a Section 6673 penalty . 10 Should Petitioner institute such frivolous and 11 groundless arguments in the future, we have no doubt that 12 the Court will, in all likelihood, be willing and able to 13 impose penalties as appropriate . 14 Decision will be entered in accordance with this 15 opinion sustaining Respondent's determination to proceed 16 with collection as proposed in the notice of determination, 17 but denying Respondent's request that we impose a penalty 18 under Section 6673 . 19 This concludes the Court's Oral Findings of Fact 20 and Opinion in this case . 21 22 23 2 4 25 Heritage Reporting Corporation (202) 628-4888 1 THE COURT : All right, we are going to reces s 1 0 2 until the next case is called . 3 THE CLERK : All rise . 4 (Whereupon, at 11 :11 a .m ., the bench opinion in 5 the above-entitled matter was concluded . ) 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 // Heritage Reporting Corporation (202) 628-4888