TAX COURT OPINION

Case: Thomas L. Price
Docket Number: 6103-12SL
Judge: Goeke
Opinion Type: bench
Filed: 03/05/2013
Pages: 11

UNITED STATES TAX COURT WASHINGTON, DC 20217 SEC THOMAS L. PRICE, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) ) ) Docket No. 6103-12SL. ) ) ) ) ORDE R Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is ORDERED that the Clerk ofthe Court shall transmit herewith to petitioner and to respondent a copy ofthe pages ofthe transcript ofthe trial in the above case before Judge Joseph Robert Goeke at San Francisco, 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, respondent's Motion for Summary Judgment, as supplemented, will be granted and a decision will be entered for respondent. (Signed) Joseph Robert Goeke Judge Dated: Washington, D.C. March 5, 2013 SERVEDMar072013 Capital Reporting Company 3 Bench Opinion by Judge Joseph Robert Goeke February 5, 2013 Thomas L. Price Docket No. 6103-12SL 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. The oral Findings of Fact and Opinion shall not be relied upon as precedent in any other case. This case was heard pursuant to the provisions of section 7463 in effect when the petition was filed. Pursuant to section 7463(b), the decision to be entered is not reviewable by any other court. The section referenced above is to the Internal Revenue Code and other section references herein are to the Internal Revenue Code or to the Treasury regulations when indicated. This case is.before the Court based upon Respondent's Motion for Summary Judgment under Rule 121 of the Tax Court Rules of Practice and Procedure. This opinion is rendered pursuant to Rule 152 of the Tax Court Rules of Practice and Procedure which authorizes oral Findings of Fact and Opinion. Under Rule 121(b), Motions for Summary 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 1 2 3 4 5 6 7 8 Judgment are appropriate as the basis to grant a decision if the pleadings, answers to discovery and other acceptable materials shows that there's no genuine issue as to any material fact and that a decision may be rendered as a matter of law. FINDINGS In the present case Respondent's motion has been accompanied by a declaration from the Settlement 9 Officer, with attachments, and Respondent also 10 11 12 submitted a supplement to the Motion for Summary Judgment which included a copy of Petitioner's 2004 Federal Income Tax Return and a copy of the Notice of 13 Deficiency issued to the Petitioner for 2004. 14 15 16 17 18 The present case is before the Court to determine whether Respondent's proposed collection action is an abuse of discretion. Respondent's motion summarizes the facts as supported by the declaration of the Settlement 19 Officer. A hearing was held on Respondent's motion, 20 21 22 and Petitioner as well as the Respondent's Counsel appeared. The facts, as stated in Respondent's 23 motion, are generally uncontested. The Petitioner 24 25 did make vague arguments that he had no recollection of receiving the Notice of Deficiency for any of the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 periods in question. However, he did not specifically state that he did not receive the notice or that he was away from the address to which the notice was sent at any time relevant to his receipt of the notice. Further, the. Petitioner alleged that Respondent did not in fact issue any of the Notices of Deficiency. Nevertheless, because of the actions of the Settlement Officer in offering Peti.tioner consideration of the merits of the underlying liabilities for the periods in question, we do not have to reach the question of whether the Petitioner received the Notices of Deficiency. We will summarize the facts. The 16 Petitioner filed a Federal Income Tax Return for 17 18 19 20 21 22 2004. On that Federal Income Tax Return he reported zero in income. On the copy of the Federal Income Tax Return submitted by Respondent, and uncontested by Petitioner, it reflects that Petitioner received several Forms 1099 and attached those forms to the Federal Income Tax Return, but on each form the 23 Petitioner struck out the amount of income shown and,· 24 25 therefore, reported zero income on the Federal Income Tax Return, contrary to the amounts reflected on the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 6 1 2 various Forms 1099. Respondent, accordingly, determined "that 3 Petitioner had unreported income for 2004 and 4 5 6 7 increased Petitioner's income and as a result determined the Federal Income Tax liability. There's no dispute that the Petitioner did not file a timely petition after.the Notices of 8 Deficiency were issued, so the amount of liability 9 was never contested in the United States Tax Court 10 11 12 13 14 15 16 17 18 19 20 21 previously. The Petitioner failed to timely file Income Tax Returns for the years 2005, 2006 and 2007. Pursuant to section 6020(b), Respondent prepared substitutes for returns for those years. As a result of those substitutes for returns, the Respondent also determined a deficiency and issued Notices of Deficiency, one for 2005 and 2006 in August of 2010 and one for 2007. No petition ~COTrtet-e-what was filed as a result of those Notices of Deficiency. On August 11th, 2010 Respondent mailed 22 Petitioner a Notice of Federal Tax Lien Filing and 23 24 25 Your Right to a Hearing under IRS(c)6320. The notice listed income tax liabilities for the tax years 2004 through 2007 and civil 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 1 2 penalties for 1999, 2000 and 2001. The civil penalties are not in dispute in this case because 3 Petitioner's request for a hearing relative to those 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 penalties was deemed to be not timely by Respondent and we believe that that determination was correct. A Notice of Intent to Levy and Right to a Hearing was issued to the Petitioner on August 11, 2008, for 2004. Petitioner did not request a hearing as a result of that Notice of Levy for 2004. On September 1st, 2011, Respondent received a Form 12153, Request for a Collection Due Process or Equivalent Hearing as a result of the August 11th, 2011 notice sent to the Petitioner. In that request the Petitioner indicated that he did not owe some of the taxes in dispute and that he intended to seek an offer d compromise. In October 2011 Petitioner filed an income tax return for 2006. On November 29th, 2011 a Settlement Officer was assigned to conduct Petitioner's hearing pursuant to sections 6320 and 6330. Petitioner was sent a letter advising him of the assigning of the Settlement Officer. On December 1st, 2011, the Settlement 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 1 Officer mailed to Petitioner a letter scheduling a 2 3 4 5 telephone conference with the Petitioner for December 21st, 2011. In that letter the Settlement Officer indicated that the Petitioner may not raise the underlying liability if he received the Notices of 6 Deficiency. 7 8 9 However, the Settlement Officer also requested that Petitioner provide copies of his Federal Income Tax Returns for 2005, 2006 and 2007 to 10 replace the substitute for returns, and requested the 11 Petitioner to submit a Collection Information 12 13 14 Statement, Form 433-A, along with supporting documentation and a completed Form 656, Offer end Compromise, if the Petitioner intended to submit an 15 Offer and Compromise. 16 17 18 19 The Settlement Officer requested this information be submitted by December 15th, 2011. The Petitioner was advised in the letter that no collection alternatives could be considered 20 without receiving the requested information. 21 22 On December 19th, 2011, unbeknownst to the Settlement Officer, the IRS Service Center processed 23 Petitioner's 2006 Federal Income Tax Return. The 24 25 return did report some income tax liability. The Settlement Officer attempted to 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 9 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 telephone the Petitioner to have the hearing on December 21st, 2011, but the Petitioner did not answer his telephone. The Settlement Officer left a message requesting a call-back and Petitioner did not return the telephone call. On January 5th, 2012, the Settlement officer mailed Petitioner another letter requesting that the Petitioner provide the information previously requested. The Petitioner did not submit that information ln response to the January 5th letter. On February 9th, after the Petitioner failed to contact or provide the Settlement Officer any information, the Settlement Officer issued a 16 Notice of Determination sustaining the proposed 17 18 collection action. Respondent's position is that because the 19 Petitioner failed to submit any of the information 20 21 22 23 24 25 requested by the Settlement Officer there's really no basis for the Court to determine an abuse of discretion in the present case. Respondent cites Giamelli v. Commissioner, 129TC 107(2007), and Respondent also cites Treas. Reg. section 301.6330-1(f) (2) Q&A-F3. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 10 1 2 3 4 5 6 7 8 9 The regulation cited provides that the taxpayer cannot properly raise the merits of the underlying tax liability if the taxpayer fails to provide the Settlement Officer with evidence with respect to the liability after being given a reasonable opportunity to present such evidence. Respondent notes that in the letters mailed to the Petitioner on December 1st, 2011 and January 5th, 2012 the Petitioner was given an opportunity to 10 challenge the underlying tax liability, but the 11 Petitioner failed to submit the requested 12 13 14 15 16 information. The Petitioner was also given a publication explaining how the Petitioner could challenge his liability with delinquent Federal Income Tax Returns and, apparently, disregarded that information as 17 well. 18 19 20 21 22 23 24 The Petitioner doesn't argue that he provided any information to the Settlement Officer, only that the Settlement Officer did not provide him suf ficient time . However, he did not communicate this assertion to the Settlement Officer, thus providing the Settlement Officer an opportunity to extend the time frame for the request given to the 25 Petitioner. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company OPINION 11 Given the Petitioner's failure to contact the Settlement Officer, we find no basis to determine an abuse of discretion by the Settlement Officer in considering Petitioner's underlying liability or in considering Petitioner's vague assertion that 1 2 3 4 5 6 7 Petitioner wished to seek a collection alternative. 8 Given the fact that for 2004, the 9 Petitioner filed a zero return and failed to report 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 income reflected on Forms 1099 associated with that return, and the Petitioner's failure to initially file returns for the other years in question and then delinquent filing of a return for 2006, we find further evidence to support the fact that the Settlement Officer's actions were extremely reasonable in providing Petitioner another opportunity to discuss these liabilities after the issuance of several Notices of Deficiency that preceded the Collection Due Process hearing. The Petitioner was a resident of California at the time the petition in this case was filed and the Court has jurisdiction to review the present case pursuant to section 6330(b). The Court finds that Respondent's motion 25 meets the requirements of Rule 121(b) and that a 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 12 decision for Respondent is appropriate and that Respondent' s Motion for Summary Judgment should be granted. This concludes the Court's oral Findings of Fact and Opinion in this case. (Whereupon, at 10:45 a.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 25 866.488.DEPO www.CapitalReportingCompany.com