TAX COURT OPINION

Case: Brian J. Gottlob & Karin Mayer-Gottlob
Docket Number: 30571-13SL
Judge: Guy
Opinion Type: bench
Filed: 05/19/2015
Pages: 10

RMM UNITED STATES TAX COURT WASHINGTON, DC 20217 BRIAN J. GOTTLOB & KARIN MAYER-GOTTLOB, Petitioners, v. ) ) ) ) ) Docket No. 30571-13SL. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) 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 petitioners and to respondent a copy of the pages of the transcript of the trial in the abovecaptioned case before Special Trial Judge Daniel A. Guy, Jr., at Portland, Maine, on May 6, 2015, 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, an order and decision will be entered for respondent. (Signed) Daniel A. Guy, Jr. Special Trial Judge Dated: Washington, DC May 19, 2015 SERVED May 19 2015 Capital Reporting Company 3 1 2 3 4 5 6 Bench Opinion by Judge Daniel A. Guy, Jr. May 6, 2015 Brian J. Gottlob & Karin Mayer-Gottlob v. Commissioner Docket No. 30571-13SL THE COURT: The Court has decided to render 7 Oral Findings of Fact and opinions in this case, and 8 9 the following represents the Court's Oral Findings of Fact and Opinion. The Oral Findings of Fact and 10 Opinion shall not be relied upon as precedent in any 11 12 13 14 15 16 17 18 19 20 other case. This proceeding for review of a collection action is a small tax case conducted pursuant to the provisions of section 7463 of the Internal Revenue Code of 1986, as amended, and Rules 170 through 174 of the Tax Court Rules of Practice and Procedure. This bench opinion is made pursuant to the authority granted by section 7459(b) of the Internal Revenue Code of 1986, as amended, and Rule 152 of the Tax Court Rules of Practice and Procedure. 21 Hereinafter in this bench opinion, section references 22 23 24 25 are to the Internal Revenue Code of 1986, as amended, in effect for 2011, and Rule references are to the Tax Court Rules of Practice and Procedure. This matter is before the Court on the 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 4 1 2 3 parties' cross-motions for summary judgment, filed pursuant to Rule 121. Respondent's motion is supported by a declaration executed by Settlement 4 Officer Laverne Burkd (SO Burkes). This case was 5 called from the Court's trial calendar in Portland, 6 Maine, on May 4, 2015. 7 There was no appearance by or on behalf of 8 Petitioners at the calendar call. Derek W. Kelley 9 appeared on behalf of respondent. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Summary judgment serves to "Expedite litigation and avoid unnecessary and expensive trials." Fla.Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988). Either party may move for summary judgment upon all or any part of the legal issues in controversy. Rule 121(a). The Court will grant summary judgment only "If the pleadings, answers to interrogatories, depositions, admissions, and any other acceptable materials, together with the affidavits or declarations, if any, show that there is no genuine dispute as to any material fact, and that a decision may be rendered as a matter of law." Rule 121(a) and (b). As explained below, Petitioners' motion is not supported by the record and will be denied. 25 Respondent's motion, however, is well founded in the 866.488.DEPO www.Capita1ReportingCompany.com Capital Reporting Company 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 light of the averments therein, the pleadings, the supporting declaration, and the administrative record. We conclude that there is no genuine dispute as to a material fact and that Respondent is entitled to judgment as a matter of law sustaining the Notice of Determination upon which this case is based. The following facts are not in dispute and are drawn from the pleadings and other documents constituting the record in this case. On April 24, 2013, Petitioners filed a joint Federal income tax return for 2011 reporting tax due of $959. Petitioners failed to remit payment 15 with the return. 16 17 18 19 20 21 22 23 Respondent subsequently assessed the tax due, additions to tax for late filing and late payment (sections 6651(a)(1) and (2)), and statutory interest, and issued to Petitioners a notice and demand for payment. When Petitioners again failed to remit payment, Respondent issued to Petitioners a Notice of Intent to Levy and Notice of Your Right to a Hearing. 24 Petitioners responded to this notice by submitting to 25 the IRS Office of Appeals (Appeals Office) a Form 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 12153, Request for a Collection Due Process or Equivalent Hearing, stating "Previously-filed lev es are making it impossible for Brian to earn money to pay balances. The more actions taken the less likely balance can be paid. Any alternative is needed." Petitioners' case was assigned within the Appeals Office to SO Burkés. Her case activity notes indicate that she reviewed a Form 433-A, Collection Information Statement, signed by Mr. Gottlob in April 2013 (before the Notice of Intent to.Levy for 2011 was issued) and she concluded that Petitioners had $68,000 of equity in their principal residence that could be used to pay the tax due for 2011. She further noted that Petitioners had not made estimated tax payments for 2013. On November 26, 2013, SO Burkes and 17 Mr. Gottlob conducted the administrative hearing in 18 19 20 21 22 23 24 this case by telephone conference call. Mr. Gottlob stated at that time that he intended to pay the tax liability in full within two weeks. That same day, SO Burkes sent a letter to Petitioners inviting them to pay their tax liability for 2011 and to waive their right to judicial review. By letter, dated December 5, 2013, however, 25 Mr. Gottlob informed SO Burkds that a levy was placed 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company on his account for another taxable year, he was no longer able to pay the tax due for 2011 in full, he intended to make partial payment for 2011, and he cu A intended to seek judicial review. To date, 7 D6'- 1 2 3 4 5 Petitioners have not remitted any payment to the IRS 6 7 8 in respect of their tax liability for 2011. On December 24, 2013, the Appeals Office issued to Petitioners a Notice of Determination 9 Concerning Collection Action sustaining the proposed 10 11 12 13 14 15 16 17 18 levy action. Petitioners filed with the Court a timely petition for review. Section 6331(a) authorizes the Commissioner to levy upon property and rights to property of a taxpayer who is liable for taxes and who fails to pay those taxes within 10 days after notice and demand for payment is made. Section 6330(a) provides that the levy authorized in section 6331(a) may be made only if the Secretary has notified such person in 19 writing of the right to an administrative hearing 20 21 22 23 24 25 before the levy is enforced. Upon timely request, the person is entitled to an administrative hearing before the Appeals Office. Sec. 6330(b)(1). In conducting administrative hearings in collection matters, the Appeals Office must verify that the requirements of any applicable law or 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 administrative procedure have been met in process1ng the case. Sec. 6330(c)(1), (3)(A). The Appeals Office also must consider any issues raised by the person relating to the unpaid tax or proposed levy, including offers of collection alternatives, appropriate spousal defenses, and challenges to the appropriateness of the collection action. Sec. 6330(c)(2) (A), (3) (B). A person may challenge the existence or amount of his underlying tax liability if the person did not receive a Notice of Deficiency or did not otherwise have an opportunity to dispute such tax liability. Sec. 6330(c)(2)(B). Finally, the Appeals Office must consider 15 whether the collection action balances the need for 16 efficient collection against the person's concern 17 18 19 20 that collection be no more intrusive than necessary. Sec. 6330)(c)(3)(C). This Court has jurisdiction to review the administrative determination made by the Appeals 21 Office. Sec. 6330(d)(1). If the taxpayer's 22 23 24 25 underlying tax liability is not in dispute, as is the case here, we review the Appeals Office's administrative decision for abuse of discretion. Goza v. Commissioner, 114 T.C. 176, 181-182 (2000). 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 9 1 2 3 4 5 An abuse of discretion occurs if the Appeals Office exercises its discretion "arbitrarily, capriciously, or without sound basis in fact of law." Woodral v. Commissioner, 112 T.C. 19, 23 (1999). Under the circumstances of this case, the 6 Court's review is limited to the administrative 7 record. See Murphy v. Commissioner, 469 F.3d 27 (1st 8 Cir. 2006), aff'g 125 T.C. 301 (2005). 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Petitioners asserted in their motion for summary judgment that the Appeals Office erred in failing to consider whether the proposed levy would result in economic hardship. They go on to state that their tax liability for 2011 was subsequently placed in "currently not collectible status resulting an of appeals process involving a separate tax year." Petitioners have not pointed to any specific information in the administrative record indicating that they raised economic hardship as an issue with SO Burk8s or that their tax liability for D - 2011 should be placed in kne currently not collectible status.¹ ¹ It may be that Petitioners account for 2011 has been placed in "currently not collectible" status as 25 Part of a larger settlement concerning other taxable years that are not before the Court in this case. con 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 10 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Lacking factual support in the administrative record, Petitioners' motion will be denied. Having reviewed the administrative record, we cannot say that the Appeals Office abused its discretion in determining to proceed with the proposed levy. Although Mr. Gottlob suggested in early December 2013 that Petitioners would make a partial payment for 2011 (instead of the full payment previously discussed with SO Burkd(cid:0)540),they did not make a partial payment and they never identified a specific alternative, such as installment payments or an offer71n7compromise, to the proposed collection 06 action. Without additional information from 16 Petitioners, SO Burkd reasonably concluded, on the 90- information that she had in the administrative record, that Petitioners could pay the tax due for 2011 and that it was appropriate to proceed with the proposed levy. The record shows that SO BurkdÎ properly 17 18 19 20 21 22 23 Ú°^Ý*°® * Any such resolution, however, is not reflected in the . O 24 25 record of this case, and does not control the disposition of this case. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 11 1 2 3 4 verified that the requirements of all applicable laws and administrative procedures were met in the processing of Petitioners' case, sec. 633(c)(1), and that the proposed levy fairly balances the 5 Government's need for the efficient collection of taxes with Petitioners' concerns that the collection action be no more intrusive than necessary, sec. 6330(c)(3)(C). In sum, we conclude that there is no dispute as to a material fact that the Appeals Office did not abuse its discretion in this case, and Respondent is entitled to judgment as a matter of law sustaining the Notice of Determination upon which this case is based. This concludes the Court's oral findings of fact and opinion. (Whereupon, at 11:28 a.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 2 4 25 866.488.DEPO www.CapitalReportingCompany.com