TAX COURT OPINION

Case: Thomas W. Bowers
Docket Number: 340-15L
Judge: Goeke
Opinion Type: bench
Filed: 06/29/2016
Pages: 13

UNITED STATES TAX COURT WASHINGTON, DC 20217 THOMAS W. BOWERS, Petitioner(s), v. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) ) ) Docket No. 340-15 L. ) ) ) ) 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 Joseph Robert Goeke at Nashville, Tennessee on June 17, 2016, containing his oral findings of fact and opinion rendered at the trial session at which this case was heard. In accordance with the oral findings of fact and opinion, respondent's Motion for Summary Judgment, filed February 4, 2016, will be granted and a decision entered for respondent. (Signed) Joseph Robert Goeke Judge Dated: Washington, D.C. June 29, 2016 SERVED JUL - 1 2016 Capital Reporting Company 3 Bench Opinion by Judge Joseph Robert Goeke June 17, 2016 Thomas W. Bowers v. Commissioner Docket No. 340-15L 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 bench opinion is rendered pursuant to the authority provided in Tax Court Rule of Practice and Procedure 152, and Internal Revenue Code Section 7459(b). Section references in the body of this opinion are to the Internal Revenue Code unless otherwise noted, and the rule references are to the Tax Court Rules of Practice and Procedure. This case is procedurally before the Court based upon the parties' cross-motions for summary judgment pursuant to Rule 121. The case arises from the IRS's efforts to collect federal income tax liabilities for 1999, 2002, 2003 and 2004 by means of levy and lien. We have jurisdiction under Section 6330(d) 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 to review the notices of determination sent to the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 4 1 Petitioner, Mr. Bowers. He mailed a document to the 2 Court with a postmark date of December 29th, 2014, 3 which was within a described period to file the 4 5 6 7 8 9 petition, after his receipt of the notices of determination, which were dated December 3rd, 2014. For the reasons explained herein we will grant Respondent's motion for summary judgment and deny Petitioner's motion for summary judgment. Mr. Bowers resided in Tennessee at the time 10 he mailed the petition to the United States Tax 11 Court. He failed to file federal income tax returns 12 13 14 15 16 17 18 19 20 21 22 23 24 25 for the years in question. Respondent issued a notice of deficiency to his last known address for each of those years, and the parties have stipulated that Mr. Bowers lived at the address, which was used by Respondent to mail the notices of deficiency at the time the notices of deficiency were mailed to him. He does not deny that the address used in the notices of deficiency was his actual address. The notice of deficiency sent to Mr. Bowers for 1999 was returned to the Internal Revenue Service as unclaimed by the post office. We note his address is a post office box. The notice of deficiency sent for 2002 was 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 also returned as unclaimed. The notice of deficiency for 2003 was sent on February 9th, 2007 and the notice of deficiency for 2004 was sent on February 12th, 2007. Neither of these notices of deficiency were returned to the Internal Revenue Service. Mr. Bowers' arguments in this case are that he did not receive the notices of deficiency and that he was denied a face-to-face hearing by the settlement officer. In this context we note that he did not petition the Tax Court with respect to the proposed assessments for 1999, 2002, 2003 and 2004. Respondent assessed those tax liabilities after the notices of deficiency were sent and no timely petitions were filed with the United States Tax 16 Court. 17 18 19 20 21 22 23 24 25 The tax and interest for 1999 and 2002 were assessed on February 20th, 2006. The tax and interest for 2003 was assessed on June 25th, 2007, and for 2004 on June 18th, 2007. Mr. Bowers made the same arguments with the settlement officer that he raised in this court concerning the fact that he did not receive the notices of deficiency. The settlement officer determined that the Internal Revenue Service sent him 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 6 1 2 3 4 a notice of deficiency for each year. The settlement officer properly verified this by reference to the Internal Revenue Service records and post office records in the files of the Internal Revenue Service, 5 which were available to the settlement officer as 6 7 8 part of his review of Mr. Bowers' collection due process case. For the years 1999 and 2002 the settlement 9 officer received copies of the notices of deficiency 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 that had been sent to Mr. Bowers and had been returned by the post office with the notation "unclaimed." For 2003 and 2004 the settlement officer received only a partial copy of the notices of deficiency and did not receive the certified mail list. Therefore, the settlement officer did give Mr. Bowers an opportunity to seek review of the merits of the tax liabilities for 2003 and 2004 by filing delinquent federal income tax returns for those years. Mr. Bowers never provided the settlement officer with returns for 2003 or 2004, nor did he raise the underlying tax liability for 1999 and 2002 before the settlement officer by providing any information which would show the assessments made for those years were invalid. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 7 1 2 3 When asked to provide his arguments concerning the underlying liabilities for the years in question at the hearing of the parties' joint 4 motions for summary judgment, Mr. Bowers offered no 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 arguments that the assessments determined by the Respondent were invalid, nor did he challenge Respondent's assertions that he received income for the years in question. In his request for a hearing before the settlement officer Mr. Bowers indicated he would like to seek an installment agreement or an offer in compromise for payment arrangements with the Internal Revenue Service. The settlement officer sent him a letter advising him that she had scheduled a telephone conference for June 24th, 2014 and that if he wished to have a face-to-face conference he needed to provide delinquent tax returns and financial information, which would be necessary to determine if an offer in compromise could be achieved or some other payment agreement could be reached with him. He was advised to provide this information to the settlement officer within 14 days of her letter, if he wished to have a face-to-face conference. She specifically asked him to provide Form 433-A, collection information statement, and 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 1 2 3 4 5 6 7 8 signed 1040's for the years after the years in question, all the way through 2013. He did not call at the time the telephone conference was scheduled, and he did not provide the requested information to the settlement officer. On June 24th, 2014, the settlement officer sent Mr. Bowers a letter advising him to provide the requested information and delinquent tax returns 9 within 21 days. She also told him that she had 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 verified that the Internal Revenue Service had sent notices of deficiency to him for 1999 and 2002 and that if he wished to challenge the liabilities for 2003 and 2004, he had to file delinquent tax returns for those years within 21 days. Mr. Bowers replied in a letter dated August 8th, 2014. He stated that he did not receive the notices of deficiency and that he wanted the settlement officer to send him a copy of the rules and regulations governing collection due process hearings because he wished to make sure she was complying with applicable procedures. He did not send her the requested financial information or any delinquent returns. The settlement officer then issued on December 3rd, 2014 a 25 notice of determination regarding Respondent's 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 9 1 2 3 4 5 6 7 8 proposed lien and levy action, and a notice of determination regarding Respondent's filing of federal income tax lien, and as we previously stated, then Mr. Bowers timely forwarded a petition to this court. Under Rule 121(b) motions for summary judgment may be supported by supporting affidavits or declarations. Respondent's motion in the present 9 matter was supported by a declaration from the 10 settlement officer. And at the hearing of the 11 motions for summary judgment the parties submitted a 12 13 14 15 16 stipulation of facts to supplement their submissions relative to the motions pending. That stipulation includes the agreement that Mr. Bowers was sent a final notice of intent to levy and notice of your right to a hearing dated 17 October 23rd, 2013, in which he was advised that 18 19 20 21 22 23 24 25 Respondent intended to levy to collect the unpaid income tax liabilities for the years 1999, 2002 and 2003 and 2004. The parties have also stipulated that Mr. Bowers was sent a notice of federal tax lien filing and your right to a hearing under IRC 6320 on November 5th, 2013, which also related to the years before the Court. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 10 1 2 3 4 5 6 Mr. Bowers submitted his request for a hearing on December 12th, 2013. The parties also stipulated the complete files relied upon by the settlement officer in analyzing Mr. Bowers' case for both the lien and levy, and the parties stipulated that Mr. Bowers' 7 mailing address from 2005 ÑÉ the date he filed the 8 9 10 11 12 petition in this case was the mailing address used by the Internal Revenue Service to send documents to Mr. Bowers, including the notices of determination in this case. By analyzing the information attached to 13 Respondent's motion for summary judgment and the 14 15 16 17 18 19 20 21 information stipulated by the parties to supplement their submissions in support of the cross-motions for summary judgment, we have verified that the appeals officer took the appropriate steps to verify the issuance of the notics of deficiency at the proper / address, and that the settlement officer also verified that the appropriate procedural steps were taken in assessing the tax liability and informing 22 Mr. Bowers of his rights concerning the proposed lien 23 24 25 and levy actions, which ultimately resulted from the assessments. One of Mr. Bowers' assertions is that he 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 11 was improperly denied a face-to-face hearing with the appeals officer. As we previously stated, when he was asked at trial what arguments he would have submitted to the appeals officer in support of his assertions about the underlying liability, he had no response. And we also note that he has never offered any evidence that he doesn't actually owe the amounts in question, nor has he offered any specific reason why the Internal Revenue Service failed to follow proper procedures in assessing these amounts against him, other than his blanket assertion he did not receive the notices of deficiency, which while it may be in the true the case of the notices he returned and did not pick up at his post office box, it's not a viable defense to valid assessments made, since the notices were mailed to the address of record with the Internal Revenue Service, and he failed to petition the notices of deficiency for the four years in question before this Court in a timely manner. Because Mr. Bowers was properly sent the notices of deficiency, he is not entitled to seek review of the underlying tax liability for the years in question before this Court, but in addition he failed to submit any information to the settlement officer, which would have enabled the settlement 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 12 1 2 3 4 5 6 7 8 officer to review the underlying tax liability and revise the amounts that have been assessed. This failure causes any arguments regarding the underlying liability to be not available to him before this Court. Giamelli v. Commissioner, 129 T.C. 107, 115 (2007). The Giamelli analysis is also supported by Treasury Regulation Section 301.6330- 1(f)(2) Q&A-F3, Procedural and Administrative 9 Regulations. 10 11 12 Regarding Mr. Bowers' request for a face- to-face hearing, we note that such a hearing is not required by either the case law nor the Treasury 13 Regulations. See Katz v. Commissioner, 115 T.C. 329, 14 15 337-338 (2000) and see also Section 301.6330- 1(d) (2),Q&A-D7 Procedural and Administrative 16 Regulations. 17 18 19 20 21 22 23 We specifically note that a face-to-face hearing is not required when the taxpayer has offered no basis on which a constructive conversation could take place, because the taxpayer has failed to provide any financial information or delinquent returns, which would be a basis for discussion. That is precisely the case in the present situation. 24 Moline V. Commissioner, T.C. Memo 2009-110, aff'd 363 25 Fd. APPX 675 before the Tenth Circuit 2010. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 13 1 2 3 4 Based upon an overall review of the information reviewed by the settlement officer, the settlement officer's notices of determination and having heard the parties' arguments in the cross- 5 motions for summary judgment, and the hearing, and 6 7 8 9 10 11 12 13 14 15 having reviewed the parties' stipulation of facts and the attached exhibits, we believe the record establishes that respondent's motion for summary judgment is valid as there is no factual dispute and that the settlement officer did not abuse discretion in upholding the collection action via liens or levy, having properly balanced the interest of the public to collect the tax liability against the intrusion upon Mr. Bowers resulting from such collection. Finally we note that Respondent is not 16 seeking sanctions under Section 6673(a)(1), and we 17 would not impose those sanctions in the present 18 matter, because we believe Mr. Bowers cooperated in 19 20 21 22 the presentation of this case at the hearing on the parties' joint motions for summary judgment. However, we would advise Mr. Bowers that he should not continue to make frivolous arguments before ßhis 18 23 Court or any other federal court regarding this 24 25 federal income tax liability or he may face sanctions in the future. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 14 1 2 Give this analysis, we will grant Respondent' s motion for summary judgment and deny 3 Petitioner' s motion for summary judgment and enter a 4 decision for Respondent in the present matter, which 5 will sustain the proposed collection action. THIS CONCLUDES THE COURT'S ORAL FINDINGS OF FACT AND OPINION IN THIS CASE. (Whereupon, at 1:25 p.m., the above- entitled matter was concluded.) 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