TAX COURT OPINION

Case: Richard Conant Giller
Docket Number: 4472-18L
Judge: Thornton
Opinion Type: bench
Filed: 03/15/2019
Pages: 14

CLC UNITED STATES TAX COURT WASHINGTON, DC 20217 RICHARD CONANT GILLER, Petitioner, v. ) ) ) ) Docket No. 4472-18 L. 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 above case before Judge Michael B. Thornton at Los Angeles, California, 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, a decision will be entered for respondent sustaining the proposed collection action. (Signed) Michael B. Thornton Judge Dated: Washington, D.C. March 15, 2019 SERVED Mar 18 2019 RECEIVED 3/13/19 IN THE UNITED STATES TAX COURT In the Matter of: ) RICHARD CONANT GILLER, ) Docket No. 4472-18L Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent. ) ) ) ) ) ) Pages: 1 through 12 Place: Los Angeles, California Date: March 4, 2019 1973)406-2250loperationseescribersmet|www.escribers.net IN THE UNITED STATES TAX COURT In the Matter of: RICHARD CONANT GILLER, Petitioner, v. ) ) ) ) Docket No. 4472-18L ) ) ) ) COMMISSIONER OF INTERNAL REVENUE, Respondent. ) ) Edward R. Roybal Center 255 East Temple Street Room 1167, Los Angeles, California 90012 llth Floor & Fed. Bldg. March 4, 2019 The above-entitled matter came on for bench opinion, pursuant to notice at 3:42 p.m. BEFORE: HONORABLE MICHAEL B. THORNTON Judge APPEARANCES: For the Petitioner: No Appearance For the Respondent: No Appearance 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 P R O C E E D I N G S 2 (3:42 p.m.) THE CLERK: Recalling from the calendar docket number 4472-18L, Richard Conant Giller. (Whereupon, a bench opinion was rendered.) 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 (973)A06-2250|operations@erribersawt|www4scribersnet 3 1 2 3 4 5 6 7 8 9 10 11 12 Bench Opinion by Judge Michael B. Thornton March 4, 2019 Richard Conant Giller v. Commissioner of Internal Revenue Docket No. 4472-18L 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. Except as otherwise provided by Rule 152(c) of the Tax Court Rules of Practice and Procedure, the oral findings of fact and opinion shall not be relied upon as precedent in any other case. This bench opinion is made pursuant to the 13 authority granted by section 7459(b) and Rule 152. 14 section references are to the Internal Revenue Code in 15 effect for all applicable times. All rule references are 16 to the Tax Court Rules of Practice and Procedure. All 17 monetary amounts are rounded to the nearest dollar. 18 This case was tried on March 4, 2019, in Los 19 Angeles, California. Petitioner appeared pro se. Ms. 20 Laura J. Mullin appeared on behalf of respondent. 21 Findings of Fact 22 23 24 25 Petitioner has outstanding Federal income tax liabilities for his 2011, 2013, and 2015 tax years. At trial petitioner conceded any issue with respect to respondent's determinations with respect to his 2013 and 73)406-2250|operationseescribers;netlwwwascribersmet 2015 liabilities, stating that he was disputing only the 4 determination with respect to his 2011 liability. Petitioner failed to file a processable Federal income tax return for 2011. Respondent prepared a substitute for return (SFR) for petitioner pursuant to section 6020(b). On February 9, 2015, respondent mailed a notice of deficiency for 2011 to petitioner's last known address. Petitioner did not file a petition with this Court in response to the notice of deficiency. 1 2 3 4 5 6 7 8 9 10 On May 15, 2017, respondent sent to petitioner a 11 Letter 1058, Notice of Intent to Levy and Your Right to a 12 Hearing, for his 2011, 2013, and 2015 tax years. On June 13 12, 2017, petitioner sent to respondent two Forms 12153, 14 Request for a Collection Due Process or Equivalent 15 Hearing. On each of the Forms 12153, petitioner checked 16 boxes for collection alternatives of "Installment 17 Agreement", "Offer in Compromise", and "I Cannot Pay 18 Balance". Petitioner attached a written statement to both 19 Forms 12153, stating that he disputes the liabilities, the 20 additions to tax, and the interest, and that he "also 21 disagree[s] with and dispute[s] the appropriateness of the 22 23 proposed collection actions". The Internal Revenue Service (IRS) Office of 24 Appeals sent petitioner letters on June 19, August 16, 25 september 26, October 20, and November 16, 2017. These cribers (973)406-2250loperationseescribersnet|www.escrbersaet 5 letters requested that petitioner provide certain information and documents, including the following: (1) specific information and supporting documentation for his various disputes; (2) proof of compliance with estimated tax payments; (3) proof of withholding compliance; (4) a copy of his 2014 tax return; (5) a completed Form 433-A, Collection Information Statement for Businesses, including any necessary supporting documents; (6) a signed copy of his Form 1040, U.S. Individual Income Tax Return, for the 2011 year and (7) amended returns for the 2013 and 2015 tax years if he disputed the tax shown on his original returns for those years The letters also advised /^4 1 2 3 4 5 6 7 8 9 10 11 12 13 petitioner that his collections due process (CDP) hearing 14 was assigned to Settlement Officer Brenda R. Catron- 15 Matthews (the SO). Petitioner failed to respond to any of 16 those letters. Petitioner also did not provide any of the 17 18 requested information and documentation that the SO had requested for purposes of considering collection 19 alternatives. 20 On January 30, 2018, the SO issued a Notice of 21 Determination Concerning Collection Action(s) Under 22 Section 6320 and/or 6330 sustaining the notice of levy for 23 the 2011, 2013, and 2015. Therein the SO determined that 24 all legal and administrative requirements had been met; 25 that petitioner was precluded from challenging the 73)406-225Òjoperationseescribersnet|www.escribersnet 6 underlying liabilities because he had had prior OPportunities to do so; that respondent was unable to consider collection alternatives because petitioner did not provide requested documents and delinquent returns; and that the proposed levy properly balanced the need for efficient collection of taxes with petitioner's concern regarding the intrusiveness of the collection actions. While residing in California, petitioner timely petitioned this Court. 1 2 3 4 5 6 7 8 9 10 After concessions by petitioner, the issues for 11 decision are whether petitioner is liable for the 12 13 outstanding tax liability from tax year 2011 and whether the SO abused her discretion in refusing to withdraw the 14 Notice of Intent to Levy, 15 Opinion 16 17 18 Section 6331(a) authorizes the Secretary to levy upon the property and property rights of a taxpayer who fails to pay a tax within 10 days after notice and demand. 19 Before the Secretary may levy upon the taxpayer's 20 property, the Secretary must notify the taxpayer of the 21 Secretary's intention to make the levy. Sec. 6331(d) (1). 22 23 The Secretary must also notify the taxpayer of his right to a CDP hearing. Sec. 6330(a)(1). If the taxpayer 24 requests a CDP hearing, the hearing is conducted by 25 APPeals. Sec. 6330(b) (1). At the hearing the taxpayer 73) 4062 250 } operationsserribersmet | wwwascribersoet may raise any relevant 7 issue relating to the unpaid tax or the proposed levy. Sec. 6330(c)(2) (A). Relevant issues include any collection alternatives, challenges to the appropriateness of the collection action, and spousal defense. Id. After the CDP hearing Appeals must determine whether proceeding with the proposed levy is appropriate. In making that determination Appeals is required to consider relevant issues raised by the taxpayer and also 1 2 3 4 5 6 7 8 9 10 whether the proposed levy action appropriately balances 11 12 13 the need for efficient collection of taxes with the taxpayer's concerns regarding the intrusiveness of the proposed collection action. Sec. 6330(c) (3). In 14 addition, the Appeals officer must verify that the 15 16 17 requirements of any applicable law or administrative procedure have been met. Sec. 6330(c)(1), (3). Once the SO makes a determination, the taxpayer 18 may appeal the determination to this Court. Sec. 19 6330(d)(1). Where the validity of the underlying tax 20 21 22 liability is at issue, the Court reviews the determination de novo. Goza v. Commissioner, 114 T.C. 176, 181-182 (2000). Where the underlying tax liability is not 23 Properly at issue, the Court reviews the determination for 24 25 abuse of discretion. Id. at 182. The Appeals Office abuses its discretion if it acts "arbitrarily, 73)406-2250joperaMorseescribers.net|www.escribers.net 1 capriciously, or without sound basis in fact or law." 2 Woodral v. Commissioner, 112 T.C. 19, 23 (1999). 8 3 4 5 6 7 8 9 10 11 When, as here, the IRS prepares a substitute for return pursuant to section 6020(b), the taxpayer may raise his underlying liability in an administrative hearing if he did not receive a notice of deficiency or otherwise have a prior opportunity to contest the liability. See secs. 6320 (c), 6330 (c) (2) (B); see als o v. r4 Commissioner, 114 T.C. 604, 609 (2000). But this Court considers a taxpayer's challenge to his underlying liability in a collection action case only if he properly 12 raised that challenge at his administrative hearing. See 13 Giamelli v. Commissioner, 129 T.C. 107, 115-116 (2007). 14 15 An issue is not properly raised at the administrative hearing if the taxpayer fails to request consideration of 16 that issue by Appeals or if he requests consideration but 17 18 19 20 21 22 23 fails to present any evidence after being given a reasonable opportunity to do so. Id.pa 115 In his CDP hearing request petitioner challenged the underlying liability for his 2011 tax year. The SO determined that petitioner had had a prior opportunity to contest his underlying liability because he was sent and received a notice of deficiency and therefore could not 24 contest the underlying liability at the CDP hearing. 25 Petitioner did not comply with the SO's requests for stem (9733 406-2250 l operationseescribertnetl www.escnbers.net information during the hearing and did not otherwise 9 Present the SO with any evidence despite having been given a reasonable opportunity to do so. At trial, petitioner asserted that he did file a Form 1040 for 2011 and that the SFR was invalid as a result. However, the evidence petitioner presented in support of his arguments shows that his Form 1040 was not processed by the IRS, as it lacked his wife's signature. The record also convinces us that, contrary to 1 2 3 4 5 6 7 8 9 10 petitioner's assertion, he did not successfully e-file his 11 12 13 14 15 16 17 18 19 2011 return. (The TurboTax materials petitioner offered as proof state in two different places that "You can still file electronically" by taking certain steps. The evidence petitioner has offered does not demonstrate that he ever took those extra steps, and the IRS transcripts that are part of the administrative record do not indicate that any 2011 return was ever filed by petitioner.) In any event, petitioner has not disputed that he received a notice of deficiency regarding his 2011 20 liability. Consequently, petitioner may not challenge the 21 underlying liability as he had a prior opportunity to do 22 so and failed to make specific contentions or to proffer 23 any evidence before the SO. 24 Where the underlying tax liability is not 25 properly at issue, the Court reviews the IRS determination cribers 73)4002250[operationsøescribers.net[www.escribersnet only for abuse of discretion. Goza v. Commissioner, 114 T.C. at 182. Thus, in assessing respondent's failure to 10 withdraw the Notice of Intent to Levy, we review for abuse of discretion only. Abuse of discretion exists when a determination is "arbitrary, capr1clous, or without sound basis in fact or law." See Murphy v. Commissioner, 125 T.C. 301, 320 (2005), aff'd, 469 F.3d 27 (1st Cir. 2006). In his petition petitioner suggests that the SO abused her discretion in sustaining the levy. In the 1 2 3 4 5 6 7 8 9 10 notice of determination respondent determined that the 11 12 13 14 15 levy was appropriate because no collection alternative was agreed upon between petitioner and the SO, and so there was no basis to withdraw the levy. Although petitioner did express interest in collection alternatives on his Forms 12153, the administrative record convinces us that 16 he never actually discussed any collection alternatives 17 with the SO. In fact, the administrative record reflects 18 19 20 21 22 that petitioner failed to respond to the SO's requests for information. Although petitioner contends that he returned a phone call from the SO, his testimony was so general and lacking in specifics that we regard it as insufficient to show that he ever made a good-faith effort 23 to respond to the SO's numerous requests for information. 24 we conclude and hold that the SO did not abuse her 25 discretion in sustaining the proposed levy on account of (973)406-2250{operations®escribers.net|www.esaibers.net petitioner's failure to provide the requested financial information. See Sullivan v. Commissioner, T.C. Memo. 11 2012-337; see also sec. 301.6320-1(e)(1), Proced. & Admin. Regs. Decision will be entered for respondent sustaining the proposed collection action. This concludes the Court's findings of fact and opinion in this case. (Whereupon, at 3:55 p.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 (973)406-2250]operations@escribersmet|wwwescribersnet CERTIFICATE OF TRANSCRIBER AND PROOFREADER 12 CASE NAME: Richard Conant Giller v. Commissioner DOCKET NO.: 4472-18L We, the undersigned, do hereby certify that the foregoing pages, numbers 1 through 12 inclusive, are the true, accurate and complete transcript prepared from the verbal recording made by electronic recording by Troy Ray on March 4, 2019 before the United States Tax Court at its session in Los Angeles, CA, in accordance with the 1 2 3 4 5 6 7 8 9 10 applicable provlslons of the current verbatim reporting 11 12 contract of the Court and have verified the accuracy of the transcript by comparing the typewritten transcript 13 against the verbal recording. 14 15 17 18 19 20 21 22 23 24 25 Carrie Clouse, CDLT-143 Transcriber 3/7/19 Date Jessica Hernandez Proofreader 3/11/19 Date ·(9 3y406-2250loperatiorseescribersnet|wwwescribËrs.ner