TAX COURT OPINION

Case: Stanley J. Kline
Docket Number: 23090-07L
Judge: Colvin
Opinion Type: bench
Filed: 07/22/2008
Pages: 11

UNITED STATES TAX COURT WASHINGTON, DC 2021 7 STANLEY J . KLINE , Petitioner , V . COMMISSIONER OF INTERNAL-REVENUE , Respondent . Docket No . 23090-07L 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 trial of the above case before Judge Diane L . Kroupa at Memphis, Tennessee on June 10, 2008, . containing her oral findings of fact and opinion rendered after the conclusion of trial . In accordance with the oral findings of fact and opinion, decision will be entered for respondent . (Signed) Diane L. Kroupa Judg e Dated : Washington, D .C . July 22, 2008 SERVED JUL 2 2 2008 2 1 Bench Opinion by Judge Diane L . Kroupa June 10, 200 8 2 Kline v . Commissioner Docket No . 23090-07 L .3 THE COURT : The Court has decided to render 4 oral findings of fact and opinion in this case, an d 5 the following represents the Court's oral findings of 6 fact and opinion . These oral findings of fact and 7 opinion shall not be relied upon as precedent in any 8 other case . 9 This bench opinion is made pursuant to the 10 authority granted by section 7459(b) and Rule 152 . 11 All section references are to the Internal Revenue 12 Code as amended and in effect for 2005, the year at 13 issue, and all rule references are to the Tax Court 14 Rules of Practice and Procedure . 15 This is a collection review case involving 16 the filing of a notice of Federal tax .lien to collect 17 petitioner's unpaid liabilities for the taxable year 18 2005 . This collection review matter is before th e 19 Court on respondent's Motion for Summary Judgment 20 filed on April 29, 2008 . 21 Stanley J . Kline appeared on his own behalf . 22 Terra-Lynn Zentara appeared on behalf of respondent . .23 FINDINGS OF FAC T 24 The record establishes or the parties do not 25 dispute the following : Heritage Reporting Corporation (202) 628-4888 1 Petitioner resided in Tennessee at the time 2 he filed the collection review petition in this case . 3 Petitioner filed a return for the year at issue bu t 4 did not pay the entire amount owing . The unpai d 5 balance was a $73,683 .61 tax liability . Respondent 6 assessed the amount of unpaid taxes reflected on th e 7 return for 2005, and petitioner failed to pay the assessed taxes . Respondent therefore issued to petitioner a letter dated December 6, 2006, entitle d 10 "Notice of Federal Tax Lien Filing and Your Right to a 11 Hearing," for the outstanding tax liability for th e 12 year at issue . (This notice shall be referred to as 13 the "Lien Notice ." ) 14 In response to the Lien Notice, petitioner 15 timely requested a hearing . In his hearing request, 16' petitioner asserted that although he is an attorney, 17 the lien destroys his ability to obtain funds to pay 18 the liability, and the lien impacts petitioner' s 19 credibility as an attorney . He also asserted that he 20 has no ability to pay the debt on a monthly basis nor 21 make a substantial payment . Petitioner has little in 22 assets and depends on his wife for support . I t 23 appears in other parts of the record that petitioner 24 has a gambling habit . 25 The settlement officer assigned t o Heritage Reporting Corporation (202) 628-4888 1 petitioner's hearing informed petitioner to complete a 2 Form 433-A, entitled "Collection Informatio n 3 Statement," and provide proof of household income and 4 expenses . The letter also . informed petitioner that , 5 if,he failed to provide the necessary information, the 6 settlement officer would be unable to consider an y 7 collection alternatives . Petitioner failed to provide any financia l 9 information . Without any additional information from 10 petitioner, the settlement officer sustained the 11 proposed collection action by lien in a Notice of 12 Determination Concerning Collection Action(s) under 13 Section 6320 and/or 6330, dated September 7, 2007 . 14 Petitioner timely filed a petition to contest the 15 proposed lien action to collect petitioner's unpaid 16 tax liability for the year at issue . Petitione r 17 stated that the determination is contrary to . 18 , applicable law, is contrary to relevant facts, and the 19, Service essentially ignored the oral informatio n 20 petitioner provided of his financial status . Again, 21 petitioner asserted that the lien impairs hi s 22 financial status and removing the lien woul d 23 facilitate collection but offered no collection 24 alternative nor did petitioner ever provide the 25 requested financial information . Heritage Reporting Corporation (202) 628-4888 . r 5 1 As stated previously, respondent filed a 2 summary judgment motion, and petitioner filed a 3 response on May 12, .2008, by the required deadline . 4 Petitioner states in his response that respondent is 5 not entitled to summary judgment as a matter of law 6 because there are material facts in dispute, namely 7 that petitioner apparently provided "hard" documents . 8 to respondent regarding his finances but failed t o 9 provide the necessary financial information in writing 10 when requested . 11 OPINION 12 We are asked to decide whether to grant 13 summary judgment . Summary judgment is intended to 14 expedite litigation and avoid unnecessary an d 15 expensive trials . See, e .g ., FPL Group, Inc . v . 16 Commissioner , 116 T .C . 73, 74(2001) . A motion for 17 summary judgment will be granted if the pleadings, 18 answers to interrogatories, depositions, admissions, 19 and other acceptable materials, together with the 20 affidavits, if any, show that there is no genuine 21 issue as to any material fact and that a decision may 22 be rendered as a matter of law . See Rule 121(b) ; 23 Elect . Arts, Inc . v . Commissioner , 118 T .C . 226, 238 24 (2002) . The moving party has the burden of provin g 25 that no genuine issue of material fact exists and that 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 it is entitled to judgment as a matter of law . See , e .g ., Rauenhorst v . Commissioner , 119 T .C . 157, 16 2 (2002 ) . The party opposing summary judgment must se t forth specific facts that show that a genuine questio n of material fact exists and may not rely merely o n allegations or denials in the pleadings . Grant Cree k Water Works, Ltd . v . Commissioner , 91 T .C . 322, 32 5 (1988 ) ; Casanova Co . v . Commissioner , 87 T .C . 214, 21 7 (1986) . Standard of Review . We begin with th e standard of review . Where the validity of th e underlying tax liability is properly at issue, th e Court will review the matter on a de novo basis . Sego v . Commissioner , 114 T .C . 604, 610 (2000) . Where, as is the case here, the validity of the underlying ta x liability is not properly placed at issue, the Cour t will review respondent's determination for abuse o f discretion . Sego v . Commissioner , supra ; Goza v . Commissioner , 114 T .C . 176, 181-182 (2000) . We mus t decide whether respondent exercised his discretio n arbitrarily, capriciously, or without sound basis i n fact or law . See" Woodral v . Commissioner , 112 T .C . 19, 23 ( 1999 ) ; Fargo v . Commissioner , T .C . Memo . 2004-13 . Based upon our examination of the entir e record before us , we find that respondent did no t Heritage Reporting Corporation (202) 628-4888 7 1 abuse his discretion in determining that th e 2 collection action should proceed with respect to 3 petitioner's unpaid liabilities for 2005 . 4 We now discuss general collection 5 proceedings . Section 6321 imposes a lien in favor of 6 the United States on any property and rights t o 7 property of a taxpayer when demand for payment of that 8 person's liability for taxes has been made and the 9 person fails to pay those taxes . The lien arises when 10 the assessment is made . Sec . 6322 . 11 Section 6320 provides that the Secretary 12 shall furnish the taxpayer described in section 6321 13 with written .. notice that a lien was filed . The person 14 may then request an administrative review hearing to 15 be conducted in a manner consistent with th e 16 procedures set forth in sections 6330(c), (d), and 17 (e) . Sec . 6320(c) . If the taxpayer requests a 18 hearing, he or she may raise at that hearing any 19 relevant issues relating to the unpaid tax . Sec . 20 6330(c)(2) . Relevant issues include any appropriate 21 spousal defenses , challenges to the appropriateness of 22 collection, and possible alternative means of 23 collection such as an installment agreement or an 24 offer-in-compromise . Sec . 6330(c)(2)(A) . After the 25 hearing, the settlement officer is required to make a Heritage Reporting Corporatio n (202) 628-4888 determination that addresses issues the taxpayer raised, verifies that all requirements of applicabl e (cid:127)3 law and administrative procedures have been met, and 4 balances the need for the efficient collection o f 5 taxes with the legitimate concern of the person that 6 any collection action be no more intrusive tha n 7 necessary . Sec . 6330 (c) (3) (C ) 8 The record reflects that the settlement 9 officer properly verified that all the legal an d 10 procedural requirements have been met . The settlement 11 officer confirmed, using a transcript of petitioner's 12 accounts, that assessments were properly made for the 13 year at issue, that appropriate and timely notice s 14 were sent regarding the assessments, and tha t 15 petitioner was properly informed of his rights with 16 respect to the lien action . 17 The record also reflects that petitioner 18 does not dispute in the petition that the settlement 19 officer committed an abuse of discretion . Instead, 20 petitioner asserts that the determination is contrary 21 to applicable law, is contrary to relevant facts and 22 the IRS has ignored his written appeal of offerin g 23 $200 a month . Petitioner also asserts that removing 24 the lien will facilitate collection of the ta x 25 liability, and at the . hearing petitioner was unable to Heritage Reporting Corporatio n (202) 628-4888 9 1 propose an offer - in-compromise . Any issue not raised 2 in the petition is conceded by petitioner . In 3 addition , petitioner did not present any financial 4 information for respondent to evaluate an y 5 alternatives . We have frequently and consistentl y 6 held that an officer does not abuse any discretion if 7 the taxpayer fails to submit the required an d 8 requested financial information . It is not an abuse 9 of discretion for personnel to refuse to conside r 10 collection alternatives where a taxpayer fails to 11 submit requested financial information . Sapp v . 12 13 14 Commissioner , T .C . Memo . 2006 - 104 ; Pricchiottino v . Commissioner , T .C . Memo . 2004 - 231 ; Newstat v . Commissioner , T .C . Memo . 2004-208 . 15 The settlement officer also addressed the 16 other issues petitioner raised in his hearing request . 17 The settlement officer informed petitioner that h e 18 needed to appeal the Service ' s rejection of his offer 19 to pay $200 a month . In three separate letters , 20 petitioner was told that he needed to .provide a 21 completed Form 433-A, Collection Informatio n 22 Statement , to provide the necessary financial 23 information to respondent . Finally, the recor d 24 reflects that the settlement officer properly balanced 25 the need for efficient collection of taxe s Heritage Reporting Corporation (202) 628-4888 1 0 1 petitioner's legitimate concern that any collection 2 action be no more intrusive than necessary . 3 Petitioner has not asserted any spousal 4 defenses, or otherwise offered any additiona l collection alternatives . See sec . 6330 (c)(2) . Accordingly, these issues are now deemed conceded . Rule 331 (b) (4) . 8 Petitioner has not presented any evidence or 9 persuasive arguments to convince us that respondent 10 abused his discretion .. We therefore conclude that 11 respondent did not abuse his discretion in upholding 12 respondent' s proposed lien action to collect from 13 petitioner outstanding tax liabilities for 2005 . 14 To reflect the foregoing, decision will be 15 entered for respondent and an appropriate order will 16 be issued sustaining the determinations set forth in 17 the Notice of Determination Concerning Collectio n 18 Action(s) Under Section 6320 and/or 6330, dated 19 September 7, 2007, upon which this case is based , 20 regarding the unpaid liabilities for the taxable year 21 2005 . The order will also grant respondent's motion 22 for summary judgment . 23 This concludes the Court's oral findings of 24 fact and opinion in this case . 25 Heritage Reporting Corporation (202) 628-4888 1 (Whereupon ,, at .2 :52 p . m ., the bench opinion 2 in the above - entitled matter was concluded . ) 1 1 3 4 5 7 8 9 10 11 // 1 2 13 14 // 1 5 16 17 18 19 20 21 22 23 24 25 Heritage Reporting Corporation . (202) 628-4888