TAX COURT OPINION

Case: Eldo Klingenberg
Docket Number: 6950-08L
Judge: Colvin
Opinion Type: bench
Filed: 06/16/2009
Pages: 12

UNITED STATES TAX COURT WASHINGTON , DC 2021 7 ELDO KLINGENBERG , Petitioner, v . ) Docket No . 6950-08 L COMMISSIONER OF INTERNAL REVENUE, Respondent . O R D E R Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it i s 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 proceedings of the above case before Judge Diane L . Kroupa at San Diego, California on May 6, 2009, containing her oral findings of fact and opinion . In accordance with the oral findings of fact and opinion, an order and decision will be entered for respondent . ' (Signed) Diane L. Kroupa Judg e Dated : Washington, D ..C . June 16, 2009 'SERVED. JUN 16 2009 2 1 Bench Opinion by Judge Diane L . Kroupa May 6, 2009 2 Eldo Klingenberg v . Commissioner Docket No .' 6950-08L 3 THE COURT : The Court'has decided to rende r 4 oral findings of fact and opinion in this case, an d 5 the following represents the Court's oral findings of 6 fact and opinion . These oral findings of fact an d 7 opinion shall not be relied upon as precedent in any 8 other case . 9 This bench opinion is made pursuant to the 10 authority granted by Section 7459(b) and Rule 152 . 11 All section references are to the Internal Revenue 12 Code as amended and in effect for the years at issue, 13 and all Rule references are to the Tax Court Rules of 14 Practice and Procedure . 15 This is a collection review case involving a 16 proposed levy to collect Petitioner's unpai d 17 liabilities for each of the years at issue where 18 Petitioner failed to file a tax return and Respondent 19 prepared a return . The years at issue include 1998, 20 1999, 2000, 2001, 2002 , and 2003, which means that 21 Petitioner failed to file a return for six years in a 22 row _ by asserting frivolous arguments that his income 23 is not taxable . 24 There was no appearance by or on behalf of 25 Petitioner . Erin Salel appeared on behalf of Heritage Reporting Corporation (202) 628-4888 1- Respondent . 2 FINDINGS OF FACT 3 The record establishes the following : 4 Petitioner resided in California at the time he 3 5 filed the collection review petition in this case . 6 Petitioner failed to file a return for any of 7 the six years at issue . Respondent prepared returns 8 for Petitioner and Petitioner failed to file a 9 petition to contest Respondent ' s determinations for 10 any of the six years at issue . Respondent thereafter 11 assessed the tax liabilities for the years at issue, 12 along with the additions to tax and interest . 13 Petitioner failed to pay the outstanding amounts due, 14 and Respondent began collection activity to collect 15 the taxes Nby filing a Notice of Intent to Levy . 16 Petitioner requested a hearing under Section 17 6330 and the settlement officer asked Petitioner to 18 telephone her to conduct a telephone conference . 19 Petitioner failed to call . The settlement-officer 20 informed Petitioner that she would issue a 21 determination notice based upon information in th e 22 administrative file . Petitioner requested a face-to- 23 face hearing and also wanted to record the hearing . 24 Petitioner failed to raise any non-frivolous issue in 25 any communication with Respondent . Thereafter, the Heritage Reporting Corporation (202) 628-4888 s 4 1 settlement officer issued a Notice of Determination 2 Concerning Collection Actions Under Section 632 0 3 and/or 6330 on February 6, 2008 . 4 Petitioner filed a timely petition to contest 5 the proposed levy action . 6 Petitioner failed to appear at the calendar 7 call of the May 4th, 2009 trial session of the Cour t 8 in San Diego, California . Petitioner filed a document 9 on April 15th, 2009 styled as "Motion to Set Asid e 10 Trial Date and Set Briefing Schedule" that the Court 11 filed as a Continuance Motion and the Court denied . 12 The day before the calendar call, Petitioner filed 13 another document styled as "Petitioner's Statement ." 14 As there was no pending motion in this case, the Court 15 filed Petitioner's statement as a status report rather 16 than a Rule 50(c) Statement . 17 Petitioner asserts in these two documents that 18 no trial should be held as the Court's review in this 19 collection review case should be limited to th e 20 administrative record . Petitioner relies upo n 21 Robinette v . Commissioner , 439 F .3d 455 (8th Cir . 22 2006) 123 T .C . 85 (2004) and makes the sam e 23 arguments as other taxpayers in collection revie w 24 cases where we have previously and consistently found 25 these arguments to be misplaced . De Haas v . Heritage Reporting Corporation (202) 628-4888 5 1 2 3 Commissioner , T .C . Memo . 2009-25 ; Klootwyk v . Commissioner , T .C . Memo . 2008-214 ; Swisher v . Commissioner , Docket No . 11904-06L dismissed for lack 4 of jurisdiction affirmed by 6th Circuit in a n 5 unpublished order dated January 30, 2009 . Nothing in 6 the continuance motion or status report is'relevant to 7 the issue whether Respondent abused his discretion in 8 sustaining the collection action regarding all si x 9 years at issue . 10 OPINION 11 We begin with the standard of review . Where, 12 as is the case here, the validity of the underlying 13 tax liability is not properly placed at issue, th e 14 Court will review Respondent's determination for abuse 15 of discretion . Sego v . Commissioner , 114 T .C . 604 , 16 610 (2000) ; Goza v . Commissioner , 114 T .C . 176, 181- 17 182 (2000) . We must decide whether Responden t 18 exercised his discretion arbitrarily, capriciously, or 19 without sound basis in fact or law . See Woodral v . 20 Commissioner , 112 T .C . 19, 23 (1999) . Based upon our 21 examination of the entire record before us, we find 22 that Respondent did not abuse his discretion i n 23 determining that the collection action should proceed 24 with respect to Petitioner's unpaid liabilities for 25 all six years at issue . Heritage Reporting Corporation (202) 628-4888 1 Overview of Collection Proceedings . We next 2 briefly describe collection proceedings . If any 3 person liable for federal tax liability neglects o r 4 refuses to make payment within ten days of notice and 5 demand, the Commissioner is authorized to collect the 6 tax by levy on that person's property . See Sec . 7 6331(a) . At least 30 days before enforcing collection 8 by levy on the person's property, the Secretary i s 9 obliged to provide the person with a final notice of 10 intent to levy, including notice of the administrative 11 appeals available to the person . See Sec . 6331(d) . 12 The person is entitled, upon request, to an 13 administrative review hearing before Appeals . Sec . 14 6330 ( b)(1) . If the taxpayer requests a hearing ; he or 15 she may e-st at that hearing any relevant issue s 16 relating to the unpaid tax-of the proposed levy . Sec . 17 6330(c)(2) . Relevant issues include any appropriate 18 spousal defenses, challenges to the appropriateness of 19 collection, and possible alternative means o f 20 collection such as an installment agreement or an 21 offer-in-compromise . Sec . 6330(c) (2) (A) . 'After the 22 hearing, the appeals officer is required to make a 23 determination that addresses issues the taxpaye r 24 raised, verifies that all requirements of applicable 25 law and administrative procedures have been met, and Heritage Reporting Corporation (202) 628-4888 7 1 balances the need for the efficient collection of 2 taxes with the legitimate concern of the person that 3 any collection action be no more intrusive tha n 4 necessary . Sec . 6330(c) (3) (C) . 5 The record reflects that the settlement officer 6 properly verified that all the legal and procedura l 7 requirements have been met . The settlement officer 8 confirmed , using a transcript of Petitioner' s 9 accounts , that assessments were properly made for each 10 of the years ' at issue, that appropriate and timel y 11 notices were sent regarding the assessments, and that 12 Petitioner was properly informed of his rights with 13 respect to the proposed levy action . 14 The record also reflects that Petitioner did 15 not raise any relevant issue in any of the documents . 16 First, Petitioner argues that he is entitled to a 17 face-to - face hearing . We disagree . A hearing ma y 18 consist of one or more written or oral communications 19 between an appeals officer and the taxpayer . Sec . 20 301 .6330-1, Proced . & Admin . Regs . This and other 21 courts have held that face - to-face hearings are not 22 required under Section 6330 . Katz v . Commissioner , 23 115 T .C . 329 ( 2000 )( taxpayer not entitled to face-to- 24 face hearing ; telephone conference procedurall y 25 proper ) ; Leinweber v . Commissioner , T .C . Memo . 2004-1 7 Heritage Reporting Corporation (202) 628-4888 1 (face-to-face hearing not required ; prior telephone 2 conversations constitute CDP hearing) ; Tilley v . M . 6- N C United States , 270 F .Supp .2d'731 ( M-ir~-B-st- vt . Ca oi+ 2003 ) ( face-to-face hearing no t 8 DVP ® l,~L 3 4 6 5 required ; telephone conversations sufficed) ; Guy v . .D-N(cid:127)'( . Nn)L United States , 2002 +fesrttaw 173285 0 7 f 2002 )( IRS does not owe taxpayer a duty to 8 hold a face -to-face hearing) Accordingly , we 9 conclude that it is not necessary or appropriate t o 10 either remand this case to the Appeals office fo r 11 another hearing or reject Respondent's determination 12 to proceed with the proposed levy regardin g 13 Petitioner's underlying tax liabilities for each of 14 the six years at issue . 15 Moreover, the record provides that Petitioner 16 never submitted any financial information to consider 17 any collection actions . We have frequently and 18 consistently held that an officer does not abuse any 19 discretion if the taxpayer fails to submit the 20 required and requested financial information . Sapp v . 21 Commissioner , T .C . Memo . 2006-104 . In addition , 22 Petitioner argues that it was improper for the k 23 settlement officer not to allow Petitioner to tap e 24 record the hearing . Although this Court held in Keene 25 v . Commissioner , 121 T .C . 8 (2003) that the settlement Heritage Reporting Corporatio n (202) 628-4888 9 1 officer must allow a taxpayer to make an audi o 2 recording of a CDP hearing under Section 7521(a)(1), 3 we have also held that it would not be productive to 4 remand a collection case to Appeals so the taxpayer 5 can tape record the CDP hearing if the taxpayer ha s 6 onlly~made frivolous arguments . Kemper v . 7 8 Commissioner , T .C . Memo . 2003 - 195 (2003 ) ; see also Lunsford v . Commissioner , 117 T .C . 183 , 189 (2001) . 9 We find the facts of Kemper v . Commissioner , supra to 10 be the same as in this case . Petitioner has onl y 11 advanced contentions and arguments that the Court has 12 found to be. frivolous . Furthermore , we consider only 13 arguments , issues and matters that were raised at the 14 collection hearing or otherwise brought to th e 15 attention of Appeals . Magana v . Commissioner , 118 16 T .C . 488, 493 ( 2002) . 17 Finally , the record reflects that th e 18 settlement officer properly balanced the need for 19 efficient collection of taxes with Petitioner' s 20 legitimate concern that a collection be no more 21 intrusive than necessary n this proceeding no w 22 before the Court , Petitioner asserts nothing bu t 23 frivolous and groundless arguments . It is apparent 24 from the entire record that Petitioner instituted or 25 maintained this proceeding primarily, if no t Heritage Reporting Corporation (202) 628-4888 1 0 1 exclusively, as a protest against the federal income 2 tax system and his proceeding in this Court is merely 3 a continuation of Petitioner's refusal to acknowledge 4 and satisfy his tax obligations . We are convince d 5 that no purpose would be served in repeating all that 6 has been said about his frivolous and misguide d 7 arguments . 8 Petitioner has failed to file tax returns for 9 any of the six years at issue, even though'Petitioner 10 received income of over $100,000 each year . When 11 Respondent prepared a substitute for return for him 12 based on information from third party payors , 13 Petitioner failed to file a petition .to contest any of 14 the deficiencies for any of the six years at issue but 15 later filed a petition to contest the collection 16 action that he failed to prosecute . We find 17 Petitioner's reliance upon Robinette v . Commissioner , 18 19 20 supra to be misplaced . See De Haas v . Commissioner , supra ; Klootwyk v . Commissioner , supra ; Swisher v . Commissioner , supra . 21 We take this opportunity to admonish Petitioner 22 that the Court will consider imposing a penalt y 23 against Petitioner under Section 6673 if Petitione r 24 returns to the Court and advances similar arguments in 25 the future . Section 6673 authorizes the Tax Court to Heritage Reporting Corporatio n (202) 628-4888 11 1 require a taxpayer to pay to the United States a 2 penalty up to $25,000 whenever it appears tha t 3 proceedings have been instituted or maintained by the 4 taxpayer primarily for delay or that the taxpayer 5 position in such proceedings is frivolous o r i 6 7 9 groundless . Petitioner has not asserted any spousa l defenses, or otherwise offered any additional f collection alternatives . See Sec . 6330(c)(2) . 10 Accordingly, these issues are now deemed conceded . 11 Rule 331 ( b) (4 ) 12 Petitioner has not presented any evidence or 13 persuasive arguments to convince us that Respondent 14 abused his discretion . We, therefore , conclude that 15 the settlement officer did not abuse her discretion in 16 upholding Respondent ' s proposed levy action t o 17 collect-"m from Petitioner outstanding tax liabilities 18 for 1998 through and including 2003 . 19 To reflect the foregoing , decision will be 20 entered for Respondent and an appropriate order will 21 be issued sustaining the determinations set forth in 22 the - Notice of Determination Concerning Collectio n 23 Actio s) under Section 6320 and / or 6330, dated February 24 6, 2008 upon which this case is based , regarding the 25 unpaid liabilities for 1998, 1999, 2000, 2001, 2002, Heritage Reporting Corporation (202) 628-4888 t 1 2 3 4 5 and 2003 . This concludes the Court's oral findings o f fact and opinion in this case . (Whereupon, at 11 :55 a .m ., the bench opinion i n the above-entitled case was concluded . ) 12 Heritage Reporting Corporation (202) 628-4888