TAX COURT OPINION

Case: George Tobon
Docket Number: 29793-11L
Judge: Kroupa
Opinion Type: bench
Filed: 02/14/2013
Pages: 10

UNITED STATES TAX COURT WASHINGTON, D.C. 20217 GEORGE TOBON, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent. ) ) ) ) ) ) ) ) ) ORDER Docket No. 29793-11L Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is ORDERED that the Clerk of the Court shall transmit to petitioner and to respondent a copy of the pages of the transcript of the trial of this case before Judge Diane L. Kroupa in Houston, Texas on January 16, 2013, containing her 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, an appropriate decision will be entered. (Signed) Diane L. Kroupa Judge Date: Washington, D.C. February 14, 2013 SERVED Æ8 15 2013 Capital Reporting Company 3 1 2 3 4 5 6 7 8 9 10 11 12 Bench Opinion by Judge Diane L. Kroupa January 16, 2013 George Tobon v. Commissioner Docket No. 29793-11L 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 by section 7459(b) and Rule 152. 13 All section references are to the Internal Revenue 14 15 16 17 18 Code as amended and in effect for 2000, and all Rule references are to the Tax Court Rules of Practice and Procedure. This is a collection review case involving the filing of a notice of lien filing to collect 19 petitioner's unpaid tax liability for 2000. 20 21 22 23 24 Petitioner appeared pro se, and David Mora appeared on behalf of respondent. The record establishes or the parties do not dispute the following: Petitioner resided in Texas at the time he filed the collection review 25 petition in this case. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 1 2 3 4 5 6 7 8 9 The Service examined petitioner's return and determined that petitioner owed additional taxes, penalties and interest. Respondent assessed the deficiency for 2000 and petitioner failed to pay the assessed amounts. Upon petitioner's failure to pay, respondent issued to petitioner a Notice of Federal Tax Lien Filing and Your Right to a Hearing under Section 6320. The notice notified petitioner that he 10 could request a collection due process hearing. 11 Petitioner timely filed a request for a hearing. The 12 13 14 15 16 17 18 19 20 21 22 23 24 25 settlement officer assigned to the case told petitioner that he needed to provide current financial information and explained to petitioner that he needed to be current with his filing and payment obligations. The settlement officer also told petitioner that he needed this information so the settlement officer could consider any collection alternatives such as an offer in compromise or an installment agreement. Petitioner failed, however, to provide any financial information and also failed to file all required tax returns. In addition, petitioner did not challenge the underlying tax liability when he requested the hearing. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 5 1 2 Without any information from petitioner, the settlement officer issued a Notice of 3 Determination Concerning Collection Action(s) under 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 Section 6320 and/or 6330 that respondent was sustaining the lien filing to collect petitioner's unpaid tax liability for 2000. Petitioner admitted at trial that he had not filed the necessary tax returns until recently. In addition, at trial petitioner did not contest the unpaid tax amount but asked the Court to abate the penalties and interest. We must decide,$'whether to sustain 9 respondent's determination to collect petitioner's unpaid tax liability for 2000. Before we do so, we first focus on whether petitioner had an opportunity to contest the underlying liability at issue. We find that he did have an opportunity during the exam of his return for 2000. It was during the examination of petitioner's return for 2000 that 20 Petitioner should have asserted he should not be held 21 22 23 24 25 liable for the penalties. We explained to Petitioner at trial that he should have raised any defenses (such as reasonable cause) to the liability, which includes the penalties. We also explained that there is no reasonable cause exception to interest 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 6 1 2 accruing. Moreover, issues that were not raised to Appeals cannot later be raised to the Court. 3 Giamelli v. Commissioner, 129 T.C. 107 (2007). We 4 5 6 7 therefore find that petitioner is precluded from contesting the underlying liability during the CDP hearing or with this Court. We next address the standard of review. 8 Where the validity of the underlying tax liability is 9 properly at issue, the Court will review the matter 10 11 12 13 14 15 16 17 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 tax liability is not properly placed at issue, the Court will review respondent's determination for abuse of discretion. Sego v. Commissioner, supra; Goza v. Commissioner, 114 T.C. 176, 181-182 (2000). We therefore must decide whether respondent exercised his discretion 18 arbitrarily, capriciously or without sound basis in 19 20 21 22 23 24 25 fact or law. See Woodral v. Commissione_r, 112 T.C. 19, 23 (1999). Based upon our examination of the entire record before us, we find that respondent did not abuse his discretion in determining that the collection action should proceed with respect to petitioner's unpaid tax liability for 2000. We now focus on a brief overview of 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 1 collection proceedings. A lien in favor of the 2 United States is imposed on all property and property 7 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 rights of a taxpayer liable for taxes after a demand for the payment of the taxes has been made and the taxpayer fails to pay those taxes. Sec. 6321. The lien arises when the assessment is made. Sec. 6322. The Secretary generally must file a notice of Federal tax lien with the appropriate State office for the lien to be valid against certain third parties. Sec. 6323. The Secretary is also required to send written notice to the taxpayer of the filing of a notice of lien and of the taxpayer's right to an administrative hearing on the matter. Sec. 6320(a). At the hearing a taxpayer may raise any relevant issue, including appropriate spousal defenses, challenges to the appropriateness of the collection action and possible collection alternatives. Sec. 6330(c) (2) (A). A taxpayer may contest the validity of the underlying tax liability only if the taxpayer did not receive a deficiency notice or otherwise have an opportunity to dispute the tax liability. See sec. 6330(c) (2) (B); Sego v. Commissioner, 114 T.C. at 609. Following a hearing, the Appeals Office 25 must issue a notice of determination regarding the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 1 2 3 4 5 6 validity of the filed Federal tax lien. In making the determination the Appeals Office is required to take into consideration: (1) verification presented by the Secretary that the requirements of applicable law and administrative procedure have been met, (2) relevant issues raised by the taxpayer, and (3) 7 whether the proposed collection action appropriately 8 balances the need for efficient collection of taxes 9 with a taxpayer's concerns regarding the 10 intrusiveness of the proposed collection action. 11 12 13 14 15 16 17 18 Sec. 6330 (c) (3). The record reflects that the settlement officer properly verified that all the legal and procedural requirements have been met. The settlement officer confirmed, using a transcript of petitioner's account, that an assessment was properly made for 2000, that an appropriate and timely notice was sent regarding the assessment, and that 19 Petitioner was properly informed of his rights with 20 21 22 23 24 25 respect to the lien filing. The record also reflects that the settlement officer appropriately did not consider any collection alternatives because petitioner was not current with his filing obligations. Internal Revenue Service guidelines require a taxpayer to be 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 9 1 2 current with filing and payment requirements to qualify for a collection alternative. 2 3 Administration, Internal Revenue Manual (IRM) (CCH), 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 sec. 5.14.1.2(9) (e), at 17,504. Specifically, compliance with all filing requirements is a prerequisite for an installment agreement (IRM 5.14.1.4.1(3) or an offer in compromise (IRM 5.8.3.4.1(1)). See also Gregg v. Commissioner, T.C. Memo 2009-19 (it is well within the Commissioner's discretion to require the taxpayer to be in full compliance with filing requirements). Reliance on a failure to be current with all filing and payment obligations in rejecting a collection alternative or failing to consider any collection alternative does not constitute an abuse of discretion. See Pough v. Commissioner, 135 T.C. 344, 351 (2010); Roman v. Commissioner, T.C. Memo 2005-20. Accordingly, we find that the respondent did not abuse his discretion in failing to consider any collective alternatives. In addition, this Court has consistently held that there can be no abuse of discretion if the taxpayer fails to provide financial information. We have frequently and consistently held that a settlement officer does not abuse any discretion if the taxpayer fails to submit the required and 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 10 1 2 3 4 requested financial information. Sapp v. Commissioner, T.C. Memo 2006-104. The record also reflects that the settlement officer properly balanced the need for 5 efficient collection of taxes with petitioner's 6 7 8 9 10 11 legitimate concern that any collection be no more intrusive than necessary. Pet.itioner has not raised any legitimate challenges to the appropriateness of collection, did not assert any spousal defenses or otherwise offer any collection alternatives. See sec. 6330 (c) (2). 12 Accordingly, these issues are now deemed conceded. 13 14 15 16 17 18 19 20 21 22 23 24 Rule 331(b) (4). In conclusion, we find that petitioner has not presented any evidence or persuasive arguments to convince us that respondent abused his discretion. We therefore conclude that respondent did not abuse his discretion in upholding respondent's lien filing to collect from petitioner his unpaid tax liability for 2000. To reflect the foregoing, decision will be entered for respondent and an appropriate order will be issued sustaining the determinations set forth in the Notice of Determination Concerning Collection 25 Action(s) under Section 6320 and/or.6330, upon which 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 11 this case is based, regarding petitioner's unpaid tax liability for 2000. This concluded the court's oral findings of fact and opinion in this case. (Whereupon, at 2:45 p.m., the above- entitled matter was concluded.) I , 1 2 3 4 5 6 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 866.488.DEPO www.CapitalReportingCompany.com