TAX COURT OPINION

Case: Patricia A. Allen
Docket Number: 26805-07S
Judge: Colvin
Opinion Type: bench
Filed: 07/16/2008
Pages: 7

UNITED STATES TAX COURT WASHINGTON , DC 2021 7 PATRICI A IA . ALLEN , Petitione r V . COMMIS IONER OF INTERNAL REVENUE, Respondent O R D E R Docket No . 26805-07S . P Proced irsuant to Rule 152(b), Tax Court Rules of Practice and ' re, it i s ADM . F~C:Qt~sl~ UK! CA: . FZS.E O RDERED that the Clerk of the Court shall transmit herewit h to pet itioner and to respondent a copy of the pages of th e transc ript of the proceedings in the above case before Judg e Robert P . Ruwe at Cleveland, Ohio, containing his oral finding s of fac and opinion rendered on June 19, 2008 . I accordance with the oral findings of fact and opinion , decisi n will be entered for respondent . (Signed) Robert P . Ruwe Judg e Dated : Washington, D .C . July 16, 2008 SERVED JUL 17 2e08 1 Bench Opinion by Senior Judge Robert P . Ruwe 2 June 19, 2008 3 Patricia A . Allen 26805-07 S 3 5 The Court has decided to render Oral Findings of Fact and opinion in this case and the following represent s 7 he Court's Oral Findings of Fact and Opinion . These Ora l Findings of Fact and opinion shall not be relied upon a s 9 precedent in any other case . 10 This proceeding was heard pursuant to small tax 11 ase procedures pursuant to the provisions of Section 7463 12 f the Internal Revenue Code, as amended and Rules 17 0 13 through 175 of the Tax Court Rules of Practice and 14 rocedure . 15 This Bench opinion is made pursuant to th e 16 authority granted by Section 7459(b) of the Internal Revenue 17 ode, as amended , and Rule 152 of the Tax Court Rules o f 18 Practice and Procedure . 19 Patricia Allen appeared on her behalf and 20 testified in this case . 21 This case is what is commonly referred to as a 22 ollection due process case . Petitioner filed her petition 23 ontesting Respondent's notice of determination to proceed 24 with collection of her outstanding tax liability by way of 25 levy with respect to the unpaid tax for the taxable yea r Heritage Reporting Corporation (202) 628-4888 4 2004 . In her petition she states , at 1411 monies won Rat( 0 W/1 while participating in gambling activity was replayed with the same gambling casino, therefore, the Petitioner had no money to pay anyone . After 50 years of working and paying taxes voluntarily , the Petitioner requests that this burden of tax be relieved . The Petitioner is not willing to pay additional tax voluntarily . If made to pay additional tax, Petitioner feels it is unconstitutional and abuse . The Petitioner 5 for for relief . " At her hearing before the appeals officer that was 1 2 3 7 8 9 1 0 1 1 1 2 held prior to the issuance of the notice of determination, 1 3 Petitioner made similar arguments . 14 1 5 1 6 1 7 1 8 1 9 2 0 2 1 2 2 2 3 2 4 25 In the notice of determination that was sent to Petitioner , and upon which this case is based , the appeals officer stated the issues raised by the taxpayer at time as follows : "You wrote on your Form 12153 that you are not liable and you have no money . During the hearing you stated that you did not believe you had received as much in gambling winnings as the casinos reported . The settlement officer recommended that you contact the casinos for a record of your winnings and compare this to your own records and then file an amended return showing the discrepancy . You stated that you did not keep records of your winnings . Heritage Reporting Corporatio n (202) 628-4888 1 ou felt sure that your leses definitely exceeded your asses RP► 2 5 winnings ." In the summary and determination the notice of 4 determination states : "Appeals offered you the opportunit y S+rearn I , n e d jpr2 to pay with a straight installment agreement . This ollection alternative was recommended during your CD P 7 earing held on September 13, 2007 . You asked that 8 greement forms 433-D, Installment Agreement, and 12257 9 aiver, be mailed to you so that you could look over the 10 terms of the agreement and the conditions of the waiver . 11 he settlement assigned your case sent the forms to you on 12 September 13, 2007, but appeals did not receive any response 13 rom you within the time limits given . No other collection 14 alternatives were available to you because you did no t 15 provide a completed financial statement . Since no signed 16 agreement was received, the appeals office has determined 17 hat the levy is the appropriate collection action at this 18 ime . " 19 Also in the notice of determination as part of the 20 background statement, the determination letter states a s 21 follows : "On September 13, 2007, you agreed to a telephone 22 conference to discuss the issues in your case . You and the 23 ettlement officer attended your telephonic conference . You 24 explained that due to large gambling debts you were unable Care OR 25 to pay your tax liabilities at this time . You promised to Heritage Reporting Corporatio n (202) 628-4888 6 1 look over the installment agreement terms and consider 2 paying the balance due monthly . You did not provide th e requested items within a reasonable time . " Petitioner filed the 2004 income tax return on which she reported adjusted gross income of $890,926, whic h 6 included gambling winnings of $866,838 . 7 9 After claiming itemized deductions of $868,904, which included gambling losses of $ 850,683, she reported a taxable income of $22,022 and a tax liability of $1,358, 10 hich she did not pay . 11 In her return she reported interest income of $71 5 12 nd deducted state income tax of $32,349 and real estate tax 13 f $4,086 . 14 At trial Petitioner submitted a re-trial memo in 15 which she stated, "After retiring from her RP g job , ~etitioner P2 M 16 unfortunately and unwisely gifted all available funds to th e 17 14GM Grand in Detroit, Michigan . " (-C A 2 18 The disputed tax debt , according to the appeals 19 officer, is related to winnings derived from gambling games . 20 he disputed claim from the Petitioner comes from the fac t 21 that all income derived from gambling games was gifted back 22 to the MGM Grand, therefore, the income was nullified and no IZPR tt i/ OA2 23 ncome was claimed, according to tax law . )/9M 24 kokit After realizing the ramifications of the gaming 25 activity, after discussing the related debt with IRS appeals Heritage Reporting Corporatio n (202) 628-4888 k 1 personnel , Petitioner comeAto the conclusion that the result 2 of this gaming activity has created grave hardship with a 3 deficit of funds . In short, the Petitioner has no funds for 4 this debt or any other . Rof2 7 5 In the pre - trial memorandum Petitioner also 6 stated : "Petitioner asserts that the tax system wa s 7 originally conceive as a voluntary service which was created 8 to assist the U .S . of America during war times , WW-I and/or 9 I, and not a mandatory service according to th e 10 onstitution of the U .S . Under this premise , the Petitioner 11 onsiders the mandatory payment of tax debt unlawful an d 12 involuntary . " 13 At trial Petitioner simply stated that she had 14 nsufficient funds to pay any tax but offered no details . 15 To the extent that Petitioner is questioning the 16 17 underlying liability , she failed to produce any evidence and we find that her claims are unfounded and frivolous . 18 With respect to the appeals officer ' s exercise of 19 iscretion to proceed with levy, we find no abuse o f 20 iscretion and hold that Respondent may proceed with the 21 ollection action determined in the notice of defie-c? 0') 2PIZ . 22 A decision will be entered for Respondent and this 23 concludes the Court ' s oral findings of fact and opinion in 24 his case . 25 Heritage Reporting Corporation (202) 628-4888 (Whereupon, at 9 :55 a .m ., the bench opinion in th e 8 2 above-entitled matter was concluded .) 3 / / 4 6 7 8 9 10 11 12 13 14 15 16 17 18 / / / 9 / / 1 / / / / / / / / / / 19 1 / 2 0 21 22 23 24 / / / / 25 / Heritage Reporting Corporation (202) 628-4888