TAX COURT OPINION

Case: Michael J. Roberts
Docket Number: 9831-00L
Judge: Nims
Opinion Type: memo
Filed: 09/04/2002
Pages: 6

T.C. Memo. 2002-221 UNITED STATES TAX COURT STAT. ES MICHAEL J. ROBERTS, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 9831-00L. Filed September 4, 2002. P filed a petition for judicial review pursuant to sec. 6330, to proceed with collection by levy of assessed tax liabilities for 1989, 1990, and 1991. in response to a determination by R I.R.C., Held: Because P received a notice of deficiency for 1989, 1990, and 1991 and failed to seek redetermination in this Court, P's underlying tax liabilities are not properly at collection proceeding. issue in this Held, further, because the record does not establish any abuse of discretion, R's determination to proceed with collection action is sustained. Michael J. Roberts, pro se. Karen Nicholson Sommers, for respondent. BERVED SEP 4 2002 - 3 - Taxable Income Tax Additions to Tax . Year 1989 1990 1991 Deficiency Sec. 6651(a)(1) Sec. 6654 $8,964.00 7,867.00 8,190.00 $2,241.00 1,966.75 2,047.50 $604.00 516.00 470.00 Respondent's determinations were based in large part upon Forms 1099 filed by various third-party payors, which forms respondent alleges indicated that petitioner operated a drywall installation . business. Respondent also determined that petitioner received additional income for each year not reported on Forms 1099 through application of tables produced by the U.S. Department of Labor, Bureau of Labor Statistics. These adjustments were explained in the notice as follows: Based on statistical information from the U.S. Department of Labor, we have established amounts of personal income needed to pay for those expenses. Since your income was not sufficient to pay for all of your personal expenses, we have adjusted your income accordingly. living expenses and amounts of living Petitioner thereafter on July 29, 1994, filed delinquent Forms 1040 for 1989 through 1991. These returns each reflected the same Newport Beach address to which the notice of deficiency had been sent and included a Schedule C, Profit or Loss From Business, for "Drywall Installation", "DRYWALL INSTALLER", or "DRYWALL CONTRACTOR". The Forms 1040 and Schedules C showed gross receipts, interest, and a State income tax refund in amounts identical to those shown in the Forms 1099 received by - 5 - Petitioner in the Form 12153 provided the following explanation of his disagreement with the notice of levy: "IRS USED 'GUESSES' FOR TAXPAYER'S TAX LIABILITIES FOR 12-31-89, 12-31-90, 12-31-91. IRS IS REQUIRED TO PROVE INCOME. REQUEST HEARING OR ABATEMENT OF TAXES, PENALTIES, INTEREST & CHARGES." ¹ After a period of correspondence between the parties, a letter dated July 12, 2000, from Appeals Officer Steve Millang to petitioner's representative extended an invitation for a face-to- face conference: If you wish to have an Appeals hearing at my office, you can meet with me on: Monday - July 31, 2000 @ 9:30 a.m. If this time and date are inconvenient, please contact me to reschedule a mutually convenient Appeals conference. Ultimately, however, it appears that the hearing was conducted solely through telephone contact and written correspondence. Copies of letters in the record reveal that petitioner asserted he did not receive sufficient income during the 1989 to 1991 period to necessitate the filing of returns or the paying of ¹ Petitioner in the Form 12153 also made a very similar statement registering disagreement with a "Filed Notice of Federal Tax Lien". However, was not in 1996, prior to enactment of sec. 6320 and the corresponding requirement for notice to taxpayers of such agency action. issued to petitioner because the relevant a notice of Federal tax lien filing lien was filed -did not meet tax return and the Commissioner has assessed an incorrect stax,; penalties and;interest. the income requirementst'to file san income b) The Commissioñernhas 'erroneously arfd wrongfully ignored issuing a 30 day appeal to the Petitioner. The Commissioner has erroneously andfwróngfülly ignorèd and failed to allow Petitioner rights to appeal. c) Although the Commissioner has issued a Notice of Deficiéncy, Petitioner. Petitioner to obtain copies from the Commissioner of the Noti'ce was nevertréceived by the The Commissioner has denied requests from the Notice. d) The Commissioner erroneously áñd wro'nc)fully chargéd an income tax wherein- no taxable income was received d Co Petitioner with the burden of _pioofa andedelnanded the Petitioner prove Petitioner. has no taxable incónie for the 1989, 1990., sioner has erroneously and wrongfully charged the .t9:90 f:.1991 tax 'years. O The the 1989. 1-991' tax years. . ' ^ I. General. Rules - - OPINION Section 6331(a) .authorizes the Commissioner to levy upon all property and rights to property of a taxpayer who fails to pay any tax Íiability within 10 days after notice and demand for . payment., usections 6331(d)- and 6330 then' setTforth procedures . generally applicable to afford protections for taxpayers in such levy situations. Section 6331(d)- establishes- the requirement that a person be provided with at. leasti 30 days' prior written notice of the Commissio,ner' s intent to levy before collection may proceed. Section,r6331(d). also indicates that this notification should inc _ude a statement of available administrative appeals. Section 6330 (a) expands in several respects upon the premise of - 13 - See sec. 6213(a). He thus is barred from challenging the underlying tax liabilities in this collection proceeding. Accordingly, his contentions regarding lack of taxable income, as well as the burden of proof with respect thereto, are not properly at issue and will not be considered. We therefore review respondent's section 6330 determination solely for abuse of discretion. III. Review for Abuse of Discretion In addressing whether the circumstances of this case reveal . any abuse of discretion, we first deal with the allegation in the petition that respondent "wrongfully ignored issuing a 30 day appeal to the Petitioner." To the extent that this statement might refer to the preliminary 30-day letter and associated Appeals hearing that, as a matter of administrative practice, typically precede issuance of a notice of deficiency (or 90-day letter), any such argument has been repeatedly rejected. See, e.g., Smith v. United States, 478 F.2d 398, 400 (5th Cir. 1973); Rosenberg v. Commissioner, 450 F.2d 529, 531-533 (10th Cir. 1971), affg. T.C. Memo. 1970-201; Brombero v. Inglina, 300 F.2d 859, 861 (9th Cir. 1962); Montgomery v. Commissioner, 65 T.C. 511, 522 (1975); Edwards v. Commissioner, T.C. Memo. 2002-169. As this Court recently summarized: The Internal Revenue Code and the regulations do requi-re the Commissioner not day letter or to hold an administrative Appeals hearing before issuing a notice of deficiency. A 30-day letter to send a preliminary 30- - 15 - identified any other valid challenge to the appropriateness of the intended collection action, or offered an alternative means of collection. Since petitioner has failed to establish grounds for enjoining respondent from proceeding with collection by levy, we sustain respondent's determination. To reflect the foregoing, . Decision will be entered for respondent.