TAX COURT OPINION

Case: Cecil Reginald & Helen Louise Brown
Docket Number: 18588-11L
Judge: Kroupa
Opinion Type: bench
Filed: 11/18/2013
Pages: 9

UNITED STATES TAX COURT WASHINGTON, D.C. 20217 CECIL REG1NALD & HELEN LOUISE BROWN, ) ) ) ) ) ) ) ) COMMISSIONER OF INTERNAL REVENUE, Respondent. Petitioners, v. Docket No. 18588-11L ORDE R Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is ORDERED that the Clerk of the Court shall transmit to petitioners and to respondent a copy of the pages of the transcript of proceedings of this case before Judge Diane L. Kroupa in San Francisco, California on October 23, 2013, containing her oral findings of fact and opinion rendered at the trial session at which this case was calendared. In accordance with the oral findings of fact and opinion, an appropriate decision will be entered for respondent. (Signed) Diane L. Kroupa Judge Date: Washington, DC November 18, 2013 NOV 2 5 200 Capital Reporting Company 3 1 Bench Opinion by Judge Diane L. Kroupa 2 October 23, 2013 3 Cecil Reginald & Helen Louise Brown v. Commissioner 4 5 6 7 8 9 10 11 12 Docket No. 18588-11L 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. These 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 authority granted in section 7459(b) and Rule 152. 13 All section references are to the Internal Revenue 14 15 16 17 18 19 20 Code in effect at all relevant times, and all Rule references are to the Tax Court Rules of Practice and Procedure. This is a collection review case involving a lien for petitioners' unpaid federal income tax liabilities for the years 2007, 2008 and 2009(the years at issue). Petitioners appeared pro se, and 21 Matt Carlson appeared on behalf of respondent. 22 23 24 25 FINDINGS OF FACT Petitioners resided in Antioch, California at the time they filed the collection review petition. Petitioners filed a single federal income 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 4 1 tax return jointly for the years at issue. 2 Petitioners failed to remit all of the tax reported 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 on each return (unpaid tax liability). Respondent sent petitioners a notice of federal tax lien (collection action) relating to the unpaid tax liability. Petitioners responded by submitting two Forms 12153 (Request for Collection Due Process or Equivalent Hearing) on each of which they requested an offer in compromise. Petitioners also noted on each of the Forms 12153 that petitioner husband filed a Form 8857 (Request for Innocent Spouse Relief). Petitioner husband's innocent spouse request has been docketed as a separate case before the Tax Court at Docket No. 23525-11. Petitioners requested a face to face hearing. Respondent informed petitioners that they 18 must submit a Form 656 (Offer in Compromise)and a 19 20 Form 433-A (Collection Information Statement) before a face to face hearing could be scheduled. 21 Petitioners also needed to provide the completed 22 23 24 25 forms and attach the accompanying documents. Respondent further informed petitioners that if they did not submit the required forms, respondent would make a determination based upon the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 5 1 2 3 4 5 6 7 8 documents in the administrative file. Respondent did not receive the required forms and could not reach petitioners at the time the telephonic conference was scheduled. Respondent attempted unsuccessfully to reach petitioners and to get petitioners to submit the required forms. Ultimately, respondent issued petitioners a Notice of Determination concern1ng 9 Collection Actions Under(s) section 6320 and/or 6330 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 (determination notice), sustaining the collection action to collect the unpaid liabilities for the years at issue. Petitioners timely filed the collection review petition with this Court. OPINION We are asked whether to sustain respondent's collection action set forth in the determination notice. Where, as here, the validity of the underlying tax liability is not properly placed at issue, the Court will review respondent's determination for abuse of discretion. Sego v. Commissioner, 114 T.C. 604, 610 (2000); Goza v. Commissioner, 114 T.C. 176, 181-82 (2000). We must decide whether respondent exercised his discretion arbitrarily, capriciously or without 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 6 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 sound basis in fact or law. See Woodral v. Commissioner, 112 T.C. 19, 23(1999). Our review is confined to the record at the time respondent rendered his decision. Keller v. Commissioner, 586 F.3d 710, 718 (9th Cir. 2009). Based upon our examination of the record, we find that respondent did not abuse his discretion, in determining that the collection action should proceed with respect to the unpaid tax liabilities for the years at issue. We give a brief overview of the collection proceedings. The Commissioner is authorized to collect an unpaid federal tax liability by lien. Sec. 6321. The Commissioner must apprise the taxpayer of the taxpayer's right to a collection hearing before an Appeals officer. Sec. 6320(a). The Appeals officer conducting the collection hearing must determine whether the Commissioner properly sustained the collection action. Sec. 6320(b). An Appeals officer must take into account certain considerations in making the determination to sustain a collection action. Sec. 6330(c). The Appeals must verify that the Commissioner has satisfied all applicable legal and administrative requirements. Sec. 6330 (c) (3) (A). 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 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 The Appeals officer must consider all relevant issues a taxpayer raises. Sec. 6330 (c) (3) (B). Finally, the Appeals officer must balance the intrusiveness of a proposed collection action against the need for effective tax collection. Sec. 6330 (c) (3) (C). A taxpayer dissatisfied with an Appeals officer determination sustaining a proposed collection action may appeal the determination to this Court. Sec. 6330 (d). Taxpayers are expected to provide all relevant information requested by the Appeals officer for consideration of the facts and issues involved in the collection hearing. Secs. 301.6320-1(e) (1), 301.6330-1(e) (1), Proced. & Admin. Regs. We briefly explain how we reached our decision. An Appeals officer does not abuse any discretion by refusing to consider collection alternatives, if the taxpayer fails to submit the required and requested financial information. See Stanwyck v. Commissioner, T.C. Memo. 2012-180. We have frequently and consistently held that an officer does not abuse any discretion by refusing to consider collection alternatives if the taxpayer fails to submit the required and requested financial 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 1 2 3 4 5 information. Sapp v. Commissioner, T.C. Memo. 2006- 104. In addition, a settlement officer is not obligated to negotiate indefinitely or wait any specific time before 1ssulng a determination. See 6 Kreit Mech. Assocs., Inc. v. Commissioner, 137 T.C. 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 123, 134 (2011). Finally, petitioners contend that respondent is required to conduct the hearing face- to-face. We disagree. We have consistently held that a face-to-face CDP hearing is not required under section 6330. Katz v. Commissioner, 115 T.C. 329 (2000) (taxpayer not entitled to face-to-face hearing; telephone conference procedurally proper); Leineweber v. Commissioner, T.C. Memo. 2004-17 (face- to-face hearing not required; prior telephone conversations and correspondence constituted CDP hearing). The failure to provide necessary financial documentation prevents a productive and meaningful communication about potential collection alternatives. Failure to provide such information alone is sufficient to sustain the determination that Appeals office made to proceed with a levy against the taxpayer. TGI Enterprises, Inc. v. Commissioner, 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 9 1 2 3 4 5 6 7 8 9 T.C. Memo 2009-123. Petitioners have failed to advance arguments that allow us to conclude that the determination to sustain the proposed collection action was arbitrary, capricious or without sound basis in fact, or otherwise an abuse of discretion. See, e.g., Giamelli v. Commissioner, 129 T.C. 107, 112, 115 (2007). Accordingly, we sustain respondent's 10 determination in the Determination Notice. See id. 11 Petitioners have not raised any valid challenges to 12 13 14 15 16 17 18 19 20 the appropriateness of collection, did not assert any spousal defenses, or otherwise offer any collection alternatives. See sec. 6330 (c) (2). Accordingly, these issues are now deemed conceded. Rule 331(b) (4). To reflect the foregoing, decision will be entered for respondent, and an appropriate order will be issued sustaining the determination set forth in the Notice of Determination Concerning Collection 21 Action(s) Under Section 6320 and/or 6330, upon which 22 23 24 25 this case is based, regarding petitioners' unpaid income tax liabilities for 2007, 2008 and 2009. THIS CONCLUDES THE COURT'S ORAL FINDINGS OF FACT AND OPINION IN THIS CASE. 866.488.DEPO www.CapitalReportingCompany.com 1 2 3 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Capital Reporting Company (Whereupon, at 2:04 p.m., the above- entitled matter was concluded.) 10 866.488.DEPO www.CapitalReportingCompany.com