t c memo united_states tax_court rodney p walker petitioner v commissioner of internal revenue respondent docket nos 16108-14l 9435-15l filed date both p and r have moved for summary_judgment in these cdp cases we will deny p's motion and grant r's motion in part we will remand these cases to appeals for supplemental determinations on two issues rodney p walker pro_se nicole c beckley for respondent 1we consolidated the cases at docket nos 16108-14l and 9435-15l for trial briefing and opinion memorandum opinion halpern judge these consolidated cases are before us to review two determinations by the internal_revenue_service irs appeals_office appeals following two collection_due_process cdp hearings conducted pursuant to sec_6320 and c and b and c respondent seeks to collect from petitioner his unpaid federal_income_tax for hi sec_2001 through and taxable calendar years appeals' first determination was to sustain respondent's notice_of_federal_tax_lien nftl with respect to petitioner's unpaid through tax and its second determination was to sustain respondent's notice_of_intent_to_levy levy notice with respect to petitioner's unpaid and tax petitioner assigns errors to those determinations respondent denies any error we review the determinations pursuant to sec_6330 each party has moved for summary_judgment in his favor petitioner's motion and respondent's motion each party objects to our granting the other's motion except that petitioner concedes that we may grant respondent's motion as it pertains to and 2unless otherwise indicated all section references are to the internal_revenue_code_of_1986 as amended and all rule references are to the tax_court rules_of_practice and procedure 3as discussed infra respondent had already notified petitioner of his intent to collect by levy petitioner's unpaid through tax we accept that concession and will not further addre sec_2001 and sec_2002 in this report we will sometimes refer to the remaining years at issue and as the controversy years summary_judgment expedites litigation it is intended to avoid unnecessary and expensive trials it is not however a substitute for trial and should not be used to resolve genuine issues of material fact e g estate of powell v commissioner t c __ __ slip op pincite date we may grant summary_judgment 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 b the moving party bears the burden of proving that no genuine dispute as to any material fact exists and we will draw any factual inferences in the light most favorable to the nonmoving party see eg 139_tc_508 in support of his motion and in opposition to petitioner's motion respondent relies on the pleadings two declarations along with attachments thereto and relevant documents from his administrative files one declaration is by settlement officer so wilhamina hayes the appeals employee who was assigned to conduct petitioner's cdp hearing with respect to the nftl and who determined that the notice should stand the second declaration is by timothy g kash the then manager of linda reeve who was the settlement officer assigned to conduct petitioner's cdp hearing with respect to the levy notice and who determined that the notice should stand apparently so reeve is unavailable to be a declarant mr kash approved her determination to sustain the levy notice and attached to his declaration are so reeve's notes and the documents that she reviewed in making her determination petitioner has provided us with no affidavit or declaration to support either his motion or his opposition to respondent's motion he refers to and appears to rely on the declarations and file documents provided by respondent we will deny petitioner's motion grant respondent's motion in part and remand these cases to appeals for supplemental determinations on two issues background we draw the following facts from the pleadings the motions the declarations and the documents provided by respondent from his administrative files petitioner's residence petitioner resided in california when he filed the petitions notices of deficiency and certified mail logs petitioner did not file federal_income_tax returns for the controversy years because of that failure respondent completed substitutes for returns for petitioner pursuant to sec_6020 on the basis of those substitutes respondent determined deficiencies in petitioner's tax_liabilities for those years and prepared statutory notices of deficiency statutory notices or notices the record contains copies of those notices for the controversy years which were obtained by so hayes through and so reeve and in preparation for petitioner's cdp hearings each notice is correctly addressed to petitioner states that there is a deficiency in tax for that year and shows a particular united_states postal service certified mail number the record also contains a copy of a redacted certified mail log mail log or log obtained by so reeve that states that a statutory notice for was sent to petitioner the log is dated date and shows petitioner's name and address a certified mail number matching the number on the notice a postal service employee's signature and a postmark of even date with the date of the log attached to respondent's motion are copies of three other redacted mail logs the first is dated date states that 4respondent may introduce as evidence a mail log that is not in the administrative record to refute petitioner's argument that he did not receive a continued statutory notices for and were sent to petitioner and shows petitioner's name and address certified mail numbers matching the numbers on the notices a postal service employee's signature and a postmark of even date with the dates on the notices the second mail log dated date is similar except that it references statutory notices for and the third mail log dated date is different in that while it shows petitioner's name and address a certified mail number matching the number on the notice a postal service employee's signature and a postmark of even date with the date of the notice it does not state as do the other mail logs that a statutory notice was mailed to petitioner respondent acknowledges that the four mail logs contain a technical defect in that while they show the total number of pieces of mail that accompanied each log to the post office more than just the mailings to petitioner they lack acknowledgment that any number of pieces was received by the post office the spaces on the logs to show that information are blank continued statutory notice on the ground that the record may be supplemented if it does not adequately disclose the grounds for appeals' determination see crain v commissioner tcmemo_2012_97 wl at respondent has also attached to his motion a copy of form_4340 certificate of assessments payments and other specified matters for each of the controversy years each form shows that a statutory notice was issued for the year indicated and that subsequently assessment of tax was made nftl determination petitioner did not file petitions in response to any of the statutory notices and respondent's forms show that for each year he assessed the tax interest and penalties without distinction tax due petitioner did not pay the assessed amounts and on date respondent filed the nftl and notified petitioner of that filing and of his right to a cdp hearing in response to the notification petitioner timely submitted to respondent a form request for a collection_due_process or equivalent_hearing petitioner listed issues that he wished to discuss verify whether or not the irs followed all proper procedure as required_by_law i don't believe i am liable for the assessed tax i should not be held responsible for the penalties accrued to challenge this liability seeing that i never had a chance to challenge it before if this liability is indeed a proper assessment and can be proven that it is authentic and owed i would like to discuss what collection alternatives are available to me including but not limited to offer_in_compromise installment agreements and any other payment arrangements that may be available to me in preparation for conferring with petitioner so hayes reviewed various documents from respondent's administrative files to determine respondent's compliance with the law and administrative procedure she reviewed transcripts from respondent's integrated data retrieval system idrs to verify that statutory notices had been issued and that the assessments for each controversy year were properly made as stated she obtained copies of the notices for through and noted that they had been sent to petitioner's address of record following that preparation she made two attempts to contact petitioner by letter to arrange his cdp hearing but petitioner responded to neither letter her first letter dated date set forth the date and time for a telephone conference and instructed petitioner that she could consider collection alternatives only if he filed returns for through and returned to her a collection information statement the letter also informed him that he could not dispute his underlying liabilities because he had had a prior opportunity to do so the letter stated that he had been sent deficiency notices for each of through and had failed to file tax_court petitions in response to any of them she telephoned him at the time established for the telephone conference but the phone number petitioner had provided was no longer in service her second letter dated date invited petitioner to telephone her and informed him that he had until date to provide the requested information and that if he did not provide it appeals would promptly make a determination with respect to his hearing request petitioner did not provide the requested information and on date appeals sent him notice of its determination to sustain the nftl nftl determination in an attachment to the nftl determination so hayes stated the following reasons for the determination the requirements of any applicable law or administrative procedure had been met petitioner could not raise his underlying tax_liabilities because he had had a prior opportunity to do so appeals could not consider collection alternatives because petitioner had failed to file returns and to provide the requested collection information the nftl was appropriate under the circumstances it balanced the need for the efficient collection_of_taxes with petitioner's concern that the collection action be no more intrusive than necessary petitioner timely petitioned us for review of the nftl determination petitioner assigned the following errors to that determination respondent failed to meet the requirements of applicable law and procedure during the cdp hearing he did not allow petitioner the opportunity to challenge his liability for the assessed tax he did not allow petitioner to dispute discrepancies in the assessment of the tax he did not accord petitioner a fair and impartial hearing he did not provide petitioner with documents files and admissible evidence to support respondent's claim of the assessed tax he denied petitioner a face-to-face hearing he did not allow petitioner to make an audio recording of the hearing levy-notice determination in date respondent sent petitioner the levy notice in response petitioner timely submitted another form raising the same issues that he had raised in response to the nftl what ensued is much the same as that which ensued following petitioner's request for a cdp hearing with respect to the nftl to determine respondent's compliance with the law and administrative procedure so reeve reviewed idrs transcripts to verify that assessments for and were made and she obtained copies of the statutory notice and mail log for her letter dated date is similar to so hayes' first letter including so reeve's statement that petitioner could not dispute his liability during his cdp hearing because respondent's records indicate that he had been sent statutory notices the letter set a telephone conference for date petitioner responded to that letter by letter dated date march letter he did not by that letter provide any unfiled returns nor did he provide the requested collection information he denied having had a prior opportunity to dispute his underlying tax_liability for either or arguing that he could not have had a prior opportunity because he had never received a statutory notice for either year subsequently he did not answer the phone when on date so reeve called him for the scheduled telephone conference on that date she again wrote petitioner acknowledging his letter and reiterating her request for unfiled tax returns and for collection information necessary for her to consider any collection alternative she invited petitioner to contact her and gave him two weeks to provide the requested information she stated that without the requested information appeals would promptly make a determination with respect to his hearing request petitioner did not respond to the april letter and on date appeals sent petitioner notice of its determination to sustain the levy notice levy-notice determination appeals summarized the levy-notice determination as follows appeals has determined that all legal and administrative requirements for action taken have been met the notice_of_intent_to_levy was appropriate and it balances the need for the efficient collection_of_taxes with the legitimate concern of the taxpayer that any collection action is no more intrusive than necessary in an attachment to the levy-notice determination so reeve added that she had not considered collection alternatives because petitioner was not current in his tax_return filing obligations and had not submitted financial documentation she could not consider challenges to his underlying liabilities because he had had a prior opportunity to challenge them petitioner timely petitioned us for review of the levy-notice determination assigning errors similar to those he assigned to the nftl determination i introduction discussion sec_6320 and sec_6330 provide taxpayers the opportunity for notice and a hearing upon the filing of an nftl sec_6320 and before a levy to collect unpaid tax sec_6330 if a taxpayer requests a cdp hearing the appeals officer conducting the hearing must verify that the requirements of any applicable law or administrative procedure have been met sec_6320 sec_6330 the taxpayer may raise at a hearing any relevant issue relating to the unpaid tax or the collection action including challenges to the appropriateness of collection actions and offers of collection alternatives see sec_6330 the taxpayer may also raise at the hearing challenges to the existence or amount of the underlying tax_liability for any period if the person did not receive a statutory notice for such liability or did not otherwise have an opportunity to dispute such liability see sec_6330 a taxpayer who may raise the underlying liability during a cdp hearing must properly raise the merits of the underlying liability as an issue during the hearing to preserve the issue for judicial review see 129_tc_107 sec_301_6320-1 q a-f3 f q a-f3 proced admin regs the merits are not properly raised if the taxpayer challenges the underlying tax_liability but fails to present appeals with any evidence with respect to that liability after having been given reasonable opportunity to present such evidence see lg kendrick llc v commissioner 146_tc_17 aff'd 684_fedappx_744 10th cir sec_301_6320-1 q a-f3 f q a-f3 proced admin regs where the underlying tax_liability is properly at issue we review the determination of liability de novo e g 114_tc_176 to the extent the underlying tax_liability is not at issue we review the determination for abuse_of_discretion id pincite in reviewing for abuse_of_discretion we must uphold the appeals officer's determination unless it is arbitrary capricious or without sound basis in fact or law see 125_tc_301 aff'd 469_f3d_27 1st cir see also 568_f3d_710 9th cir aff'g in part tcmemo_2006_166 and aff'g in part vacating in part decisions in related cases ii motions and responses a petitioner's motion petitioner asks that we summarily determine that respondent may not proceed with collection of any unpaid tax for any of the controversy years the gravamen of his claim is that respondent may not proceed with collection because he failed to comply with the procedures specified in the internal_revenue_manual irm regarding the mailing of statutory notices at the times respondent claims to have mailed statutory notices for the controversy years to petitioner the mailing procedures in the irm called for delivery of statutory notices and a postal service form to the post office where a postal service employee would compare the count and certified mail numbers used with the envelope notices see irm pt date those mailing procedures further required the irs employee delivering the statutory notices to the post office to sign and date the form_3877 to indicate 5postal service form_3877 firm mailing book for accountable mail is a form for recording items delivered to and received by the post office and showing the type of mail eg certified mail or the service requested eg signature confirmation delivery of the notices to the post office id the postal service employee was to insert a postmark on the form indicating receipt id petitioner observes that the mail logs respondent submitted to evidence the mailing of statutory notices to him for the controversy years lack both the signature of an irs employee and acknowledgment by the postal service of the number of items received petitioner argues proper verification of the exact number of envelopes the postal service received from the irs is of vital importance because it is the only way to verify that each piece of certified mail intended for delivery by the post office was actually received into the post office mail system petitioner is unclear in drawing out the consequences of the defects in the mail logs that respondent submitted most narrowly he claims that those defects deny respondent the benefit of a presumption of regularity to establish mailing petitioner also argues that respondent's failure to comply with those procedures means that the settlement officers did not fulfill their obligations under sec_6330 to verify that the assessments were made in compliance with any applicable law and administrative procedure finally and most broadly petitioner suggests that respondent's failure to comply strictly with his own standards for documenting the mailing of statutory notices means that the assessments made on the basis of those notices were as a matter of law invalid b respondent's response to petitioner's motion respondent objects to our granting petitioner's motion conceding that with regard to mailing of the statutory notices for the controversy years he is not entitled to a presumption of regularity in mailing he argues that nonetheless sos hayes' and reeve's verifications of mailing were legally sufficient and the defects in the mail logs were not fatal to either assessment or collection of the unpaid tax moreover he continues even if verification was flawed or the defects in the mail logs were legally significant the remedy would be remand to appeals or a trial not abatement of the tax due c respondent's motion respondent moves for summary adjudication in his favor with respect to all of the issues in these cases in particular he asks that we summarily determine that petitioner's underlying tax_liability is not at issue for any of the controversy years for through respondent argues that petitioner had had a prior opportunity to raise the existence or amount of his underlying tax_liabilities and was therefore precluded from raising them during his cdp hearing in response to the nftl and is likewise precluded from raising them here see daniel v commissioner tcmemo_2009_28 sec_301_6320-1 q a-e7 proced admin regs for and respondent argues that petitioner did not properly raise his underlying tax_liabilities during the two cdp hearings at issue ie the nftl hearing with respect to and the levy-notice hearing with respect to and see giamelli v commissioner t c pincite- sec_301_6320-1 q a-f3 f q a-f3 proced admin regs respondent also asks that we determine that in making their determinations to proceed with collection sos hayes and reeve complied with the requirements of sec_6320 and sec_6330 sec_6330 provides that an appeals officer's determination shall take into consideration not only her verification that the requirements of any applicable law and administrative procedure have been met but also the issues raised by the taxpayer with respect to the unpaid tax or the proposed collection actions and that the proposed collection actions balanced the need for efficient collection_of_taxes with the taxpayer's concern that any collection action be no more intrusive than necessary in particular respondent asks us to determine that sos hayes and reeve were fair and impartial properly verified respondent's assessments of tax and did not abuse their discretion in a denying petitioner a face-to-face hearing b not permitting him to record the hearings and c not considering collection alternatives d petitioner's response to respondent's motion petitioner objects to our granting respondent's motion he claims a genuine dispute as to material fact with respect to whether the settlement officers fulfilled their obligations under sec_6330 to verify that the requirements of any applicable law and administrative procedure had been met particularly with respect to petitioner's claim that in mailing the statutory notices to him respondent had failed to comply with mailing procedures specified in the irm whether the evidence of mailing of those statutory notices on which the settlement officers relied is adequate to prove that the notices were mailed whether he had had a prior opportunity to challenge the underlying tax_liabilities at issue and whether he had received statutory notices for the controversy years petitioner also disputes although he does not label it a dispute as to a material fact respondent's claim that he did not properly raise his underlying tax_liabilities during the two cdp hearings at issue iii discussion a petitioner's motion presumption of regularity while petitioner is of course correct that respondent is not entitled to a presumption of regularity to establish mailing of the notices of deficiency it does not follow that respondent's assessments were invalid sos hayes and reeve abused their discretion in deciding to the contrary and consequently petitioner is 6the presumption of regularity in mailing is a particular application of the more general presumption of regularity sometimes presumption of official regularity which supports the proposition that in the absence of evidence to the contrary public officers are presumed to have discharged their duties see eg 530_f2d_781 8th cir in our view the presumption of official regularity controls the question of the validity of the notice_of_deficiency 'the presumption of regularity supports the official acts of public officers and in the absence of clear evidence to the contrary courts presume that they have properly discharged their official duties ' 272_us_1 with respect to the mailing of a statutory notice we have said w here the existence of the notice_of_deficiency is not disputed a properly completed form_3877 by itself is sufficient absent evidence to the contrary to establish that the notice was properly mailed to a taxpayer more specifically exact compliance with the form_3877 mailing procedures raises a presumption of official regularity in favor of respondent 94_tc_82 the failure of exact compliance with the form_3877 mailing instructions however does not mean that the notice was not mailed it means only that the evidence of an undisputed notice and a form_3877 in less than exact compliance do not even absent evidence to the contrary establish as a matter of law that the notice was mailed to the taxpayer as we said in coleman v commissioner t c pincite a failure to comply precisely with the form_3877 mailing procedures may not be fatal if the evidence adduced is otherwise sufficient to prove mailing entitled to summary_judgment petitioner points to respondent's failure to submit corroborating evidence to evince proof of mailing such as habit evidence as to his mailing procedures petitioner is mistaken if he believes that copies of a proper statutory notice and an imperfect mail log are necessarily insufficient for an appeals officer or indeed any fact finder to infer from that evidence that the commissioner in fact mailed the notice to the intended recipient see eg o'r587_f3d_537 2d cir holding that the commissioner's evidence of a proper statutory notice and a form_3877 defective only in that it did not state the number of pieces of mail received by the postal service and it lacked the signature or initials of a postal service employee was in the absence of a presumption of mailing sufficient to meet the commissioner's burden of showing that the notice was mailed as discussed in the next section of this report we think that neither so hayes nor so 7in the law of evidence inferences differ from presumptions an inference is a permissible deduction that the fact finder may make without express direction of the law to that effect that is the fact finder is permitted to deduce the existence of fact b from fact a by ordinary rules of reasoning and logic a presumption is distinguished from an inference in that if basic fact a is established then the fact finder must accept that the presumed fact b has also been established unless the presumption is rebutted see jack b weinstein margaret a berger weinstein's federal evidence sec_301 pincite mark s brodin ed 2d ed reeve abused her discretion in concluding that statutory notices for the controversy years were mailed to petitioner sufficiency of settlement officers' verifications as stated if a taxpayer requests a cdp hearing the appeals officer conducting the hearing must verify that the requirements of any applicable law or administrative procedure have been met sec_6330 petitioner appears to challenge the adequacy of so hayes' and so reeve's reliance on computer transcripts for verification that the requirements of any applicable law or administrative procedure had been met respondent answers that sec_6330 does not mandate that appeals rely upon a particular document to satisfy the section's verification requirement see eg 119_tc_252 jewell v commissioner tcmemo_2016_239 at appeals may indeed rely on computer transcripts to satisfy the verification requirement see eg 329_f3d_1224 11th cir aff'g 118_tc_365 grace found v commissioner tcmemo_2014_229 at it may also rely on a mail log with minor defects such as the lack of both a postal service employee's signature and a count of the items delivered to the post office if supported by copies of the statutory notices in question see 826_f3d_1280 10th cir aff'g tcmemo_2014_139 cf o'rourke f 3d pincite not a cdp case respondent concludes in petitioner's cases the sos properly verified that all legal and procedural requirements were met by using transcripts in all years and the cml mail log for to verify that assessments were proper we agree with respondent that verification was sufficient petitioner did not during either cdp hearing bring to either settlement officer's attention the technical defect in the mail logs that respondent now acknowledges ie the absence of entries for the number of pieces of mail received by the post office indeed petitioner did not claim any defect until he objected to our granting respondent's motion and because petitioner did not bring any defects to the attention of so hayes the settlement officer did not err or abuse her discretion in relying on computer transcripts to make the necessary verifications for through the controversy years subject_to the nftl see grace found v commissioner at an appeals officer may rely on the irs account transcript to satisfy the sec_6330 verification requirement unless the taxpayer alleges that a specific irregularity transpired during the assessment process and the taxpayer provides evidence of such an irregularity for again and for the years subject_to the levy notice however petitioner had by the march letter notified so reeve of his belief that he had not received a statutory notice for either year petitioner had thus alleged an irregularity in the assessment procedure for each year and so reeve could not on account of that allegation rely on computer transcripts alone for verification see eg crain v commissioner tcmemo_2012_97 wl at the commissioner must send a notice_of_deficiency to the taxpayer before he may assess collect or reduce to judgment most income_tax liabilities if the taxpayer contests receipt of the notice_of_deficiency the commissioner must introduce evidence of actual mailing for however besides computer transcripts so reeve had the mail log listing the statutory notice which although missing some information was together with a copy of the notice sufficient to establish that the notice had been mailed as respondent claims see eg cropper v commissioner f 3d pincite o'rourke f 3d pincite- that is not necessarily the case for for the record does not establish that so reeve had a copy of the mail log dated date which shows mail addressed to petitioner with a certified mail number matching the number on the notice and while we could remand the case at docket no 16108-14l to appeals for it to clarify the record as to evidence on which so reeve relied in concluding that the notice was properly mailed to petitioner see 131_tc_197 noyes v commissioner t c memo at we do not think that is necessary we have in the record a copy of a mail log dated date showing information with respect to the notice similar enough to the information shown on the mail log on which so reeve relied for that it would be inconsistent for her to reach a conclusion with respect to whether the notice was mailed to petitioner different from the one she reached with respect to whether the notice was mailed to him we are satisfied with so reeve's efforts based on at least a computer transcript for and on both a computer transcript and a mail log for to verify that statutory notices for both and had been mailed to petitioner she did not abuse her discretion in so concluding failure to adhere to the irm finally petitioner claims that he is entitled to summary_judgment simply because of respondent's failure to comply with the standards described in the irm 8and while it remains an open question whether petitioner may challenge the existence or amount of his underlying liabilities for and see infra sec iii b c it does not follow that just because that question is open the verification question for those years also is open even if so hayes for and so reeve for both and abused their discretion in determining that petitioner had had a prior opportunity to challenge his and underlying liabilities and so could not challenge them during his nftl and levy-notice hearings it does not follow that they also abused their discretion in relying on computer transcripts and mail logs to verify that the requirements of any applicable law or administrative procedure had been met such reliance we have concluded was not an abuse_of_discretion for documenting the mailing of statutory notices taken at face value the claim rests on the premise that even if the statutory notices for the controversy years were in fact sent and moreover received appeals erred in upholding the nftl and the levy notice that would be so only if as a matter of law respondent's failure to strictly comply with the irm mailing procedures rendered invalid the assessments based on those notices the short answer to petitioner's claim is the irm lacks the force of law and does not create rights for taxpayers weiss v commissioner 147_tc_179 appeals did not solely on account of any failure by respondent to comply with the irm mailing procedures for statutory notices err in upholding the nftl and the levy notice conclusion we will deny petitioner's motion b respondent's motion dispute as to material fact we will first address petitioner's claim that there are genuine disputes as to material fact that preclude any summary adjudication in respondent's favor petitioner's first two claims--that there are genuine disputes as to whether the settlement officers fulfilled their sec_6330 verification obligations and the evidence of mailing on which they relied is adequate to prove that statutory notices were indeed mailed--seem to collapse into one claim petitioner does not assert any particular failures on the settlement officers' parts in fulfilling that obligation he seems to suggest as he did in support of his own motion that the defects in the mail logs mean that the settlement officers cannot have properly verified that the assessments were made in compliance with all legal and administrative requirements we have adequately addressed and have rejected petitioner's first two claims and need not restate our reasons we will address petitioner's remaining claims as we proceed prior opportunity to raise existence or amount of underlying liability a through for through respondent argues that petitioner had a prior opportunity to challenge the existence or amounts of his underlying liabilities and was therefore precluded from challenging them during his cdp hearing in response to the nftl and is likewise precluded from challenging them here respondent relies on a notice_of_determination concerning collection actions s under sec_6320 and or issued to petitioner on date prior determination notice that informed petitioner of appeals' determination that respondent's notice_of_levy with respect to petitioner's income_tax liabilities for through would stand a copy of the prior determination notice is attached to respondent's motion petitioner does not dispute the authenticity of the prior determination notice the prior determination notice was issued in response to petitioner's request for a cdp hearing made on date following his receipt of a levy notice for through dated date the prior determination notice recites that although the assigned settlement officer offered petitioner a hearing by telephone no hearing was held because the settlement officer could not reach petitioner by telephone at the time scheduled for the hearing and petitioner did not respond to a subsequent letter from the settlement officer with respect to petitioner's challenge to his underlying liabilities the prior determination notice states that because petitioner did not contact the settlement officer the issue of his underlying liabilities could not be discussed respondent argues that if a taxpayer previously received notice of his right to a cdp hearing with respect to the same tax and tax period he has had an opportunity to challenge the existence and amount of the underlying tax_liability and may not challenge the existence and amount of that tax_liability in a subsequent cdp hearing respondent relies on sec_301_6320-1 q a-e7 and e q a-e7 proced admin regs and daniel v commissioner tcmemo_2009_28 those authorities are consistent with respondent's argument but address a situation where the taxpayer did not request a cdp hearing in response to the earlier cdp_notice that of course is not the case here because petitioner did request a cdp hearing in response to the date levy notice for through the question is whether the prior cdp_notice and the settlement officer's subsequent actions gave petitioner a meaningful opportunity to challenge the existence or amount of his through underlying tax_liabilities we believe that they did give him a meaningful opportunity of which he did not take advantage see 128_tc_48 a conference with the appeals_office provides a taxpayer a meaningful opportunity to dispute an underlying tax_liability sec_301_6320-1 q a-e2 e q a-e2 proced admin regs an opportunity to dispute the underlying liability includes a prior opportunity for a conference with appeals because we are not here considering an actual challenge to the existence or amounts of petitioner's underlying liabilities for through but rather whether so hayes erred in precluding petitioner from raising such a challenge because she had determined that he had had a prior opportunity to do so we ask only whether so hayes abused her discretion in so precluding petitioner see 126_tc_356 which demonstrably she did not b and for and respondent argues that petitioner did not properly raise his underlying liabilities during the two cdp hearings at issue here ie the nftl hearing with respect to and the levy-notice hearing with respect to both and referring to the two forms that petitioner submitted requesting those hearings and to the march letter that petitioner sent to so reeve the sum and total of petitioner's communications to appeals in response to the nftl and the levy notice respondent claims that petitioner never stated what he was challenging with respect to his underlying liabilities but only said that he wanted to challenge those liabilities and should not be held responsible for penalties petitioner never presented any information or documents showing that the underlying liabilities were incorrect and because of that argues respondent appeals made no determination with respect to petitioner's underlying liabilities and there is nothing for us to review in their first letters to petitioner both so hayes and so reeve notified him that he could not challenge his underlying tax_liabilities because he had been sent statutory notices and thus he had had a prior opportunity to challenge his liabilities they repeated those explanations in the attachments that respectively they wrote and that were attached to the nftl and the levy-notice determinations in his two petitions in these consolidated cases petitioner makes it clear that he believes that appeals erred in failing to allow him to challenge his liability for the assessed tax it is true that if petitioner had received statutory notices for and he could not during any cdp hearing concerning those years challenge his underlying tax_liabilities see sec_6330 if however he had not received statutory notices for those years then he was entitled to challenge his underlying liabilities the record is not clear as to the bases on which sos hayes and reeve decided that petitioner had had a prior opportunity to challenge his liability both so hayes and so reeve and his liability only so reeve it is insufficient to deny him a challenge on the ground that a statutory notice had been sent to him which is the only reason either settlement officer recites without also concluding that he had received the notice as for through we are not now in disposing of respondent's motion considering an actual challenge to the existence or amounts of petitioner's and underlying liabilities but rather we are considering whether either so hayes for or so reeve for 9and while petitioner does not aver as to how his liability for either year is any less than respondent assessed we will read his complaint that he was not allowed to challenge his liability for either or to imply that he has grounds on which to challenge those liabilities both and abused her discretion in precluding petitioner from raising such a challenge on the assumption that he had received a statutory notice because the record is unclear we will remand these cases for appeals to clarify the record as to the evidence if any on which appeals relies to conclude that petitioner may not for either or challenge his underlying tax_liability if appeals is unable to conclude that petitioner received the requisite statutory notice or notices we assume that appeals will allow petitioner to raise a challenge to the existence or amount of his underlying liability before these cases are returned to us c conclusion in sum we agree with respondent that petitioner had a prior opportunity to challenge his underlying liabilities for through and was therefore precluded from challenging them during his cdp hearing in response to the nftl and is likewise precluded from challenging them here we do not decide whether petitioner is similarly precluded with respect to his underlying liabilities for and because the record is inadequate for us to determine whether in concluding that petitioner had had a prior opportunity either settlement officer abused her discretion we will remand for clarification or other appropriate action sos hayes' and reeve's compliance with the requirements of sec_6330 a introduction respondent points to the nftl and levy-notice determinations along with the settlement-officer attachments and the hayes and kash declarations as evidence that in determining to proceed with collection appeals acting through the settlement officers took into consideration the verification and other requirements specified in sec_6330 on that basis respondent argues that appeals did not abuse its discretion in determining to proceed with collection for the controversy years except to the extent that we have previously discussed ie with respect to mailing of the statutory notice and receipt of the and notices we agree that appeals complied with the requirements of sec_6330 we will address particular points raised by petitioner b cdp hearings fair and impartial petitioner contends the hearings were not fair and impartial sec_6320 and sec_6330 provide that the hearing shall be conducted by an officer_or_employee who has had no prior involvement neither so hayes nor so reeve had any prior involvement in petitioner's tax matters for the tax years at issue in the hearings both settlement officers were impartial within the meaning of sec_6320 and sec_6330 c no mandate for appeals to provide taxpayer with written confirmation that requirements of any law or procedure have been met petitioner contends that respondent did not provide him with any admissible evidence to support the determinations the short answer is that sos hayes and reeve did not have to provide petitioner with any written confirmation that the requirements of any applicable law or administrative procedure had been met as we have said sec_6330 does not require the appeals officer to rely on any particular document in satisfying the verification requirement and does not require that the appeals officer actually give the taxpayer a copy of the verification upon which he or she relied shirley v commissioner tcmemo_2014_10 at citing craig v commissioner t c pincite 118_tc_162 d no abuse_of_discretion in denying petitioner a face-to- face hearing sec_6330 does not mandate that a taxpayer be given a face-to-face hearing e g laforge v commissioner tcmemo_2013_183 at because sos hayes and reeve determined that petitioner had not filed all necessary tax returns and because petitioner had failed to return collection information statements to sos hayes and reeve the settlement officers did not abuse their discretion in determining that he was entitled to no face-to-face hearing and denying him such a hearing see id see also sec_301_6320-1 q a-d8 d q a-d8 proced admin regs e no abuse_of_discretion in not permitting audio recording petitioner had no face-to-face hearing and he did not answer telephone calls from sos hayes and reeve for scheduled telephone conferences sec_7521 accords taxpayers the right in connection with any in-person interview upon advance request to make an audio recording we have held that sec_7521 applies to sec_6330 face-to-face hearings and a taxpayer providing the irs with advance notice is allowed to record his face-to-face hearing 121_tc_8 we have also held that sec_7521 is not applicable to telephone hearings and that a taxpayer is not entitled to record his telephone hearing 127_tc_219 the short answer is that there were no spoken communications for petitioner to record and even if there had been a telephone hearing all that petitioner was offered he had no right to record it there was no abuse_of_discretion f no abuse_of_discretion in not considering collection alternatives so hayes and reeve did not abuse their discretion in not considering collection alternatives because they had determined that petitioner had not filed all necessary tax returns and because he had not returned to them the collection information statements they had requested see eg rosenthal v commissioner tcmemo_2014_252 at it is not an abuse_of_discretion for the appeals_office to reject collection alternatives and sustain a proposed collection action on the basis of the failure of a taxpayer to submit requested financial information or to achieve current compliance with filing obligations conclusion we will deny petitioner's motion and grant respondent's motion in part we will grant respondent's motion to the extent that with respect to the nftl determination we find no error in appeals' determination that respondent may proceed with collection by lien of petitioner's income_tax liabilities for through with respect to the nftl determination for and the levy- notice determination we will grant respondent's motion to the extent that respondent asks us to determine that appeals verified that the requirements of any applicable law or administrative procedure were met the nftl hearing and the levy-notice hearing were fair and impartial neither so hayes nor so reeve had to provide petitioner with any written confirmation of her verification efforts neither settlement officer abused her discretion in denying petitioner a face-to-face hearing or the right to audio record any telephone hearing and neither abused her discretion in not considering collection alternatives we will remand the cases at docket nos 16108-14l and 9435-15l to appeals for supplemental determinations clarifying the record as to the grounds on which appeals relied in precluding petitioner from challenging his and tax_liabilities if petitioner was entitled to raise challenges to those liabilities appeals shall consider such challenges and report the results of its consideration in its supplemental determinations an appropriate order will be issued denying petitioner's motion for summary_judgment granting respondent's motion for summary_judgment in part and remanding these cases for further proceedings consistent with this report


office_of_chief_counsel internal_revenue_service memorandum number release date cc tege eoeg et1 postn-165899-04 uilc date date to director submission processing cincinnati oh attn entity unit from office of division counsel associate chief_counsel tax exempt government entities subject railroad_retirement_tax_act status in accordance with the coordination procedure established between the service and the railroad retirement board rrb the rrb has provided us with its opinion that the following business became an employer under the railroad retirement act and the railroad unemployment insurance act effective ---------------- ---------------------------------- --------------------------------------------------------------- ---------------------------------------------------------- ---------------------------------------- ------------------------------------------------------------ we have reviewed the opinion of the rrb and based upon the information submitted to the rrb we also conclude that ------------------------------became an employer under the railroad_retirement_tax_act effective ---------------- please take the appropriate action regarding this business ---------------------------------- ----------------------------------------- joseph w spire--s


internal_revenue_service number release date index number -------------------------------------------------- ----------------------------- --------------------------- ------------------------------------------------------ department of the treasury washington dc third party communication none date of communication not applicable_person to contact -------------------- id no ------------- telephone number --------------------- refer reply to cc psi plr-141151-09 date date legend trust ---------------------------------------------------- --------------------------------------------------- trustee year1 year2 x dear --------------- ---------------------- ------- ------- ------------ we received a letter dated date submitted on behalf of trust by its authorized representative requesting an extension of time under sec_301_9100-3 of the procedure and administration regulations to make an election under sec_642 of the internal_revenue_code for year1 this letter responds to that request facts the information submitted provides that trust made a charitable_contribution in year2 in the amount of x trustee intended to make an election to treat the charitable_contribution as paid in year1 however trustee failed to make the election law and analysis sec_642 provides that in the case of an estate_or_trust other than a_trust meeting the specifications of subpart b there shall be allowed as a deduction in computing its taxable_income in lieu of the deduction allowed by sec_170 relating to plr-141151-09 deduction for charitable etc contributions and gifts any amount of the gross_income without limitation which pursuant to the terms of the governing instrument is during the taxable_year paid for a purpose specified in sec_170 determined without regard to sec_170 if a charitable_contribution is paid after the close of such taxable_year and on or before the last day of the year following the close of such taxable_year then the trustee or administrator may elect to treat such contribution as paid during such taxable_year the election shall be made at such time and in such manner as the secretary prescribes by regulations sec_1_642_c_-1 provides that for purposes of determining the deduction allowed under paragraph a of this section the fiduciary as defined in sec_7701 of an estate_or_trust may elect under sec_642 to treat as paid during the taxable_year whether or not such year begins before date any amount of gross_income received during such taxable_year or any preceding_taxable_year which is otherwise deductible under such paragraph and which is paid after the close of such taxable_year but on or before the last day of the next succeeding taxable_year of the estate_or_trust the preceding sentence applies only in the case of payments actually made in a taxable_year which is a taxable_year beginning after date no election shall be made however in respect of any amount which was deducted for any previous taxable_year or which is deducted for the taxable_year in which such amount is paid sec_1_642_c_-1 provides that the election under sec_1 c - b shall be made not later than the time including extensions thereof prescribed by law for filing the income_tax return for the succeeding taxable_year such election shall except as provided in sec_1_642_c_-1 become irrevocable after the last day prescribed for making it having made the election for any taxable_year the fiduciary may within the time prescribed for making it revoke the election without the consent of the commissioner sec_1_642_c_-1 provides that the election shall be made by filing with the income_tax return or amended_return for the taxable_year in which the contribution is treated as paid a statement which i states the name and address of the fiduciary ii identifies the estate_or_trust for which the fiduciary is acting iii indicates that the fiduciary is making an election under sec_642 in respect of contributions treated as paid during such taxable_year iv gives the name and address of each organization to which any such contribution is paid and v states the amount of each contribution and date of actual payment or if applicable the total amount of contributions paid to each organization during the succeeding taxable_year to be treated as paid in the preceding_taxable_year sec_301_9100-1 provides that the commissioner in exercising the commissioner's discretion may grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than months except in the case of a taxpayer who is abroad plr-141151-09 under all subtitles of the internal_revenue_code except subtitles e g h and i sec_301_9100-3 provides that requests for extensions of time for regulatory elections that do not meet the requirements of sec_301_9100-2 must be made under the rules of sec_301_9100-3 requests for relief subject_to sec_301_9100-3 will be granted when the taxpayer provides the evidence including affidavits described in sec_301_9100-3 to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and the grant of relief will not prejudice the interests of the government sec_301_9100-3 provides that except as provided in sec_301_9100-3 through iii a taxpayer is deemed to have acted reasonably and in good_faith if the taxpayer i requests relief under this section before the failure to make the regulatory election is discovered by the internal_revenue_service irs ii failed to make the election because of intervening events beyond the taxpayer's control iii failed to make the election because after exercising reasonable diligence taking into account the taxpayer's experience and the complexity of the return or issue the taxpayer was unaware of the necessity for the election iv reasonably relied on the written advice of the internal_revenue_service irs or v reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or advise the taxpayer to make the election conclusion based on the information submitted and the representations made we conclude that the requirements of sec_301_9100-3 have been satisfied as a result trust is granted an extension of time for days from the date of this letter to file an election pursuant to sec_1_642_c_-1 for trust's year1 taxable_year in addition to filing amended returns for year1 and year2 the amended returns must be filed within the day period with the service_center where trust files its returns a copy of this letter should be attached to the amended returns except as specifically set forth above we express or imply no opinion concerning the federal tax consequences of the facts described above under any other provision of the code this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent plr-141151-09 pursuant to a power_of_attorney on file with this office a copy of this letter is being sent to trust's authorized representative sincerely s curt g wilson associate chief_counsel office of the associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes


office_of_chief_counsel internal_revenue_service memorandum number release date cc pa postf-131302-07 uilc date date to steven m roth senior counsel area small_business self-employed from charles a hall senior technician reviewer procedure and administration branch procedure administration subject whether the tax_liability is abated when relief is granted under sec_6015 this chief_counsel_advice responds to your request for assistance this advice may not be used or cited as precedent ------------------------ ------------------------------ ------- ------- ------- ----------------------- ------------------ ----------------------- ----------------------- ----------------- -------------------------- ----------------------- legend taxpayer spouse year year year date date date date date date date postf-131302-07 issue whether the assessed joint income_tax_liability is abated with respect to the spouse who is granted relief from joint_and_several_liability under sec_6015 conclusion no relief under sec_6015 does not fit within sec_6404 so it does not constitute an abatement when the service grants relief under sec_6015 it merely reduces the taxpayer’s account to zero administratively to prevent it from pursuing collection activity facts the pertinent facts are as follows taxpayer filed joint federal_income_tax returns with her husband spouse for taxable years year year and year the spouses filed the year return on date including full payment for the tax due on date a deficiency was assessed the spouses filed the year and year returns on date and date respectively the spouses did not fully pay the tax due shown on those two joint returns on date taxpayer filed form_8857 request for innocent spouse relief and separation of liability and equitable relief seeking relief under sec_6015 for the joint income_tax liabilities for all three years in accordance with its procedures the service noted on the joint account that taxpayer filed a request for relief by entering transaction code with action code then it moved the liabilities from the joint account to separate_accounts for each spouse after an examination the service determined that taxpayer was entitled to relief from joint_and_several_liability for the full amount of the joint liabilities for all three years based on the information taxpayer provided on her form_8857 and supporting questionnaire form the service issued its final notice_of_determination granting relief on date accordingly on date the service adjusted its records to reflect that taxpayer was granted relief by entering transaction code which cleared the account to zero the service clears the account to zero for administrative purposes to prevent it from pursuing collection activity against someone no longer liable for a liability spouse’s separate_account showed a balance due for all three years for the joint liabilities subsequent to the granting of relief spouse submitted an offer_in_compromise during the investigation the service personnel assigned to the case discovered evidence proving that taxpayer made false statements on her form_8857 and supporting questionnaire form with respect to the facts that supported the grant of relief therefore the service re-examined taxpayer’s case and is now considering denying relief because the facts show that she does not qualify for relief given that the account was reduced to zero you wanted to make sure that if the service determines that it postf-131302-07 now will deny taxpayer relief it will be able to adjust the account to reflect the liability since the period of limitations on assessment under sec_6501 has expired law and analysis taxpayers who file joint federal_income_tax returns are generally jointly and severally liable for all taxes due sec_6013 relief from joint liability is available in limited circumstances under sec_6015 sec_6015 provides three avenues for relief first under sec_6015 a requesting spouse may elect relief from joint_and_several_liability for an understatement_of_tax attributable to erroneous items of the spouse with whom the requesting spouse filed the return if the requesting spouse did not know or have reason to know of the understatement and it would be inequitable to hold the requesting spouse liable second under sec_6015 a requesting spouse may elect to allocate a deficiency if the requesting spouse is no longer married to is legally_separated from or is no longer living with the other spouse filing the joint_return third under sec_6015 if the requesting spouse does not qualify for relief under sec_6015 or c the commissioner may grant relief from any unpaid tax or any deficiency if taking into account all the facts and circumstances it is inequitable to hold the requesting spouse liable in order to request relief a taxpayer files a form_8857 request for innocent spouse relief and separation of liability and equitable relief upon receiving the form the service notes that the taxpayer filed a request on the spouses’ joint account by entering transaction code with action code then it moves the liabilities from the joint account to separate_accounts for each spouse this process is necessary so the service can track each spouse’s separate_account activity for example once a claim for relief is filed under sec_6015 the statute_of_limitations on collection for that liability for the spouse that requested relief is suspended in most cases pursuant to sec_6015 however the collection statute is not suspended for the other spouse in addition the service cannot take certain collection actions against the spouse that requested relief but may do so against the other spouse in this case the taxpayer was originally granted full relief under subsection f when the service grants a taxpayer full relief under sec_6015 the service enters transaction code on the taxpayer’s separate_account which stands for assessed debit cleared the service clears the taxpayer’s account to zero when relief is granted in order to prevent it from pursuing collection activity against that taxpayer collection activity may continue against the other spouse so that spouse’s separate_account continues to reflect the entire amount of the assessed joint tax_liability if partial relief were granted the service would reduce the taxpayer’s account by the amount of relief granted so that the balance would only reflect the amount of the joint tax_liability for which that spouse continues to remain liable this also is necessary to ensure that the service only collects the amount of tax for which the taxpayer remains liable as the reduction of the account is merely an administrative action so that the service’s records show the amount of tax for which the taxpayer remains liable it is not an abatement postf-131302-07 abatement only refers to action taken in accordance with sec_6404 sec_6404 authorizes the service to abate a tax or liability assessment in certain circumstances sec_6404 provides the general_rule which allows the service to abate a liability that is excessive in amount assessed after the expiration of the period of limitations or erroneously or illegally assessed other subsections of sec_6404 provide rules for abatement in specific circumstances such as where small tax balances are involved generally when a liability is abated under sec_6404 it completely extinguishes the assessment 311_fsupp_1184 s d n y therefore if the service later determines that the abatement was erroneous it must reassess the liability within the applicable_period of limitations on assessment under sec_6501 in order to pursue collection activity id under sec_6404 only certain abatements can be reinstated after the period of limitations on assessment has expired such as abatements made as the result of inadvertent clerical_error see eg id pincite relief under sec_6015 does not abate the assessed tax_liability the authority for the service to grant relief from joint_and_several_liability comes from sec_6015 itself so the service does not rely upon the abatement provisions provided in sec_6404 to grant relief under sec_6015 furthermore relief under sec_6015 does not meet the conditions for abatement identified in sec_6404 as none of the specific circumstances for abatement under sec_6404 apply to relief under sec_6015 we will confine our analysis to abatement under the general_rule provided in sec_6404 when relief is granted under sec_6015 it is not because the original tax_assessment was excessive in amount assessed after the period of limitations expired or erroneous or illegal in other words there was nothing incorrect about the original assessment in contrast the relief provisions under sec_6015 were created generally out of a sense of equity in that when certain conditions exist congress determined that it would be fair to relieve one spouse from the entire amount of the joint liability see sec_6015 h conf rept pincite this result is similar to how an offer_in_compromise is handled which also reduces the amount of a liability for which the service will hold a taxpayer liable the service’s approval of an offer_in_compromise does not satisfy the conditions for abatement identified in sec_6404 the service has authority under sec_7122 to compromise any civil case not referred to the department of justice for prosecution or defense grounds for compromise are doubt as to liability doubt as to collectibility and the promotion of effective tax_administration temp sec_301_7122-1t an offer_in_compromise is an agreement between a taxpayer and the service that resolves the taxpayer's tax_liability once the taxpayer fulfills all the terms the liability will be discharged thus an offer_in_compromise does not establish that an assessed tax_liability is excessive in amount such an agreement merely reflects that the parties have agreed to resolve that liability for less than its full amount if certain conditions are satisfied an offer_in_compromise similarly is no statement about the timeliness of an assessment it also does not mean that the liability was erroneous or illegally assessed even if the offer is predicated on doubt as to liability such doubt is not tantamount to postf-131302-07 actual error or illegality in fact if the taxpayer fails to meet any of the terms and conditions of the offer and the offer is terminated due to the taxpayer’s default the service can file suit to collect the entire unpaid balance of the offer file suit to collect an amount equal to the original amount of the tax_liability minus any payment already received under the terms of the offer or file suit or levy to collect the original amount of the tax_liability without further notice to the taxpayer of any kind we note that a previous memorandum cca noted that an assessment against a requesting spouse in excess of the redetermined liability is excessive for purposes of sec_6404 and that the service has the authority to abate this excessive liability this memorandum is incorrect on this point for the reasons discussed above as taxpayer’s account currently reflects a zero balance due to the original grant of relief the service will need to reverse the grant of relief if it determines that relief was not appropriate the service can reverse the grant of relief by entering transaction code on taxpayer’s separate_account because the liability has not been abated the reversal of transaction code which reduced the account to zero does not constitute a new assessment and thus is not prohibited by the expiration of the period of limitations on assessment accordingly the period of limitations on collection under sec_6502 runs from the original date of the assessment adjusted for any suspension such as the request for relief under sec_6015 case development hazards and other considerations --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------ --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- postf-131302-07 --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------- this writing may contain privileged information any unauthorized disclosure of this writing may undermine our ability to protect the privileged information if disclosure is determined to be necessary please contact this office for our views please call if you have any further questions


internal_revenue_service number release date index number --------------------------- ---------------- ------------------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact ---------------------- id no ---------------- telephone number -------------------- refer reply to cc psi plr-143210-13 date date legend taxpayer partner partner partnership x state year year dear --------------- ----------------------------------------------------- ------------------------- ------------------------ ------------------------------------------------------------------- ---------------------- -------- ------ ------ this letter responds to a letter dated date from taxpayer’s representative requesting permission pursuant to sec_301_9100-1 and sec_301_9100-3 of the procedure and administration regulations for an extension of time to deduct under sec_263 of the internal_revenue_code and sec_1_612-4 of the income_tax regulations intangible_drilling_and_development_costs idcs for year according to the information submitted partnership is a limited_liability_company organized in state and has elected to be treated as a partnership for federal tax purposes partnership operates oil wells in state and is also engaged in exploration for and production of crude_oil partnership has three partners taxpayer partner and partner partnership had not incurred any idcs prior to year partnership engaged x to prepare partnership tax_return for year in addition x prepared each of the three partners’ individual returns for that year x represents that it inadvertently overlooked the idcs in preparing the partnership tax_return as a result partnership did not timely make the election under sec_263 and sec_1_612-4 for year plr-143210-13 and the partners did not make the sec_59 election on their individual returns x discovered the existence of idcs in year and subsequently advised partnership to seek an extension of time to file the necessary elections under sec_301_9100-1 and sec_301_9100-3 of the procedure and administration regulations taxpayer represents that granting the relief requested will not result in taxpayer having a lower tax_liability in the aggregate for the tax years affected by the election than taxpayer would have had if the election had been timely made taking into account the time_value_of_money taxpayer represents that it acted in good_faith and that granting relief will not result in prejudice to the interests of the government law and analysis sec_263 allows a taxpayer an election under regulations prescribed by the secretary to deduct idcs the regulations appear under sec_1_612-4 under sec_1 d the taxpayer may exercise the election by claiming idcs as a deduction on the taxpayer’s return for the first taxable_year in which the taxpayer pays or incurs such costs no formal statement is necessary but if the taxpayer fails to deduct the idcs the taxpayer is deemed to have elected to recover such costs through depletion to the extent that they are not represented by physical property and through depreciation to the extent that they are represented by physical property sec_59 allows a taxpayer to deduct ratably over a specified period any qualified_expenditure to which an election under sec_59 applies sec_59 includes in the definition of qualified_expenditure any amount which but for an election under sec_59 would have been allowable as a deduction determined without regard to sec_291 for the taxable_year in which paid_or_incurred under sec_263 relating to intangible drilling and development_expenditures and sec_617 relating to mining_exploration_expenditures sec_59 allows the taxpayer to deduct ratably over the year period beginning with the taxable_year in which such expenditure was made or in the case of a qualified_expenditure for intangible drilling and development_expenditures to deduct the expenditure ratably over the month period beginning with the month in which such expenditure was paid_or_incurred sec_59 specifically prohibits the deduction of the qualified_expenditures under any other section of the code if this option is elected sec_59 allows a taxpayer to make an election under sec_59 for any portion of any qualified_expenditure sec_1_59-1 prescribes the time and manner of making the sec_59 election according to sec_1_59-1 an election under sec_59 shall only be made by attaching a statement to the taxpayer’s income_tax return or amended_return plr-143210-13 for the taxable_year in which the amortization of the qualified_expenditures subject_to the sec_59 election begins the taxpayer must file the statement no later than the date prescribed by law for filing the taxpayer’s original income_tax return including any extensions of time for the taxable_year in which the amortization of the qualified_expenditures subject_to the sec_59 election begins under sec_301_9100-1 of the procedure and administration regulations the commissioner in exercising the commissioner’s discretion may grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than six months except in the case of a taxpayer who is abroad under all subtitles of the code except subtitles e g h and i sec_301_9100-2 and sec_301_9100-3 provide the standards the commissioner will use to determine whether to grant an extension of time to make a regulatory election sec_301_9100-1 sec_301_9100-2 allows automatic extensions of time for making certain elections sec_301_9100-3 allows extensions of time for making elections that do not meet the requirements of sec_301_9100-2 the commissioner will grant requests for relief under sec_301_9100-3 when the taxpayer provides the evidence including affidavits described in sec_301_9100-3 to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and the grant of relief will not prejudice the interests of the government sec_301_9100-3 sec_301_9100-3 provides in part that a taxpayer is deemed to have acted reasonably and in good_faith if the taxpayer requests relief under sec_301_9100-3 before the failure to make the regulatory election is discovered by the internal_revenue_service and the taxpayer failed to make the election because after exercising reasonable diligence taking into account the taxpayer's experience and the complexity of the return or issue the taxpayer was unaware of the necessity for the election sec_301_9100-3 provides in part that the government’s interest is considered prejudiced if granting relief would result in a taxpayer having a lower tax_liability in the aggregate of all taxable years affected by the election than the taxpayer would have had if the election had been timely made taking into account the time_value_of_money based solely on the information submitted and the representations made we conclude that the requirements of sec_301_9100-1 through have been satisfied accordingly the commissioner grants partnership an extension of time of days from the date of this letter to make the election under sec_263 on the tax_return for year with the appropriate service_center further the commissioner grants taxpayer partner sec_1 and partner an extension of time of days from the date of this letter to make the election under sec_59 on their tax returns for year with the appropriate service_center plr-143210-13 the rulings contained in this letter are based upon information and representations submitted by taxpayer and taxpayer’s representative and accompanied by a penalty of perjury statements executed by the appropriate parties while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination except as specifically set forth above we express no opinion concerning the federal tax consequences of the facts described above under any other provision of the code and the regulations thereunder specifically we express no opinion concerning whether taxpayer satisfies the requirements of sec_263 or sec_59 this letter_ruling is directed only to the taxpayer who requested it under sec_6110 a letter_ruling may not be used or cited as precedent in accordance with the power_of_attorney on file with this office we are sending a copy of this ruling letter to your authorized representative we also are sending a copy of this letter to the appropriate industry director lb_i a copy of this ruling must be attached to any income_tax return to which it is relevant alternatively taxpayers filing their returns electronically may satisfy this requirement by attaching a statement to their return that provides the date and control number of the letter_ruling sincerely associate chief_counsel passthroughs special industries by ______________________ jaime c park chief branch office of associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes cc


_ department of the treasury internal_revenue_service washington d c l 4a tax_exempt_and_government_entities_division jan uniform issue list tep lat legend taxpayer a ira b financial_institution c account d financial_institution e amount dear this letter is in response to your request dated date and supplemented by correspondence dated date date date date date and date from your authorized representative in which you request a waiver of the 60-day rollover requirement contained in sec_408 of the internal_revenue_code code the following facts and representations have been submitted under penalty of perjury in support of the ruling requested taxpayer a represents that amount was distributed from ira b on date taxpayer a asserts that her failure to accomplish a rollover of amount within the 60-day period prescribed by code sec_408 was due to the actions of her spouse which prevented her from managing her financial affairs taxpayer a further represents that amount has not been used for any purpose and that amount remains in account d taxpayer a represents that she owned ira b which was maintained with financial_institution c taxpayer a further represents that she had a very difficult marriage with her spouse and that she lived in fear of his abusive treatment taxpayer a asserts that her spouse forced her to sign a distribution request form for ira b the request was received by financial_institution c on date financial_institution c approved the disbursement of amount from ira b on date on date taxpayer a’s spouse picked up the check in the name of taxpayer a for amount at the office of financial_institution c taxpayer a was not in the office of financial_institution c at the time taxpayer’s spouse picked up the check on date amount was deposited in account d a non- ira account with financial_institution e taxpayer a represents her spouse handled all financial matters including financial matters on behalf of taxpayer a taxpayer a further represents that her spouse did not provide her with an explanation of the purpose of the transfer of amount from ira b to account d taxpayer a represents that at the time of the transfer of the ira funds due to the abusive behavior of her spouse she was afraid to question his actions in addition taxpayer a had been forced to leave the principal_residence where she and her spouse had been living together the spouse is now deceased and taxpayer a has control_over her funds taxpayer a submitted documentation from financial_institution c describing how the distribution of amount was made to taxpayer’s spouse based on the above facts and representations you request that the internal_revenue_service service waive the 60-day rollover requirement contained in sec_408 of the code with respect to the distribution of amount sec_408 of the code provides that except as otherwise provided in sec_408 of the code any amount_paid or distributed out of an ira shall be included in gross_income by the payee or distributee as the case may be in the manner provided under sec_72 of the code sec_408 of the code defines and provides the rules applicable to ra rollovers sec_408 of the code provides that sec_408 of the code does not apply to any amount_paid or distributed out of an ira to the individual for whose benefit the ira is maintained if - i the entire amount received including money and any other_property is paid into an ira for the benefit of such individual not later than the day after the day on which the individual receives the payment or distribution or ii the entire amount received including money and any other_property is paid into an eligible_retirement_plan other than an ira for the benefit of such individual not later than the day after the date on which the payment or distribution is received except that the maximum amount which may be paid into such plan may not exceed the portion of the amount received which is includible in gross_income determined without regard to sec_408 sec_408 of the code provides that sec_408 does not apply to any amount described in sec_408 received by an individual from an ira if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in sec_408 from an ira which was not includible in gross_income because of the application of sec_408 sec_408 of the code provides a similar 60-day rollover period for partial rollovers sec_408 of the code provides that the rollover provisions of sec_408 do not apply to any amount required to be distributed under sec_408 sec_408 of the code provides that the secretary may waive the 60-day requirement under sec_408 and sec_408 of the code where the failure to waive such requirement would be against equity or good conscience including casualty disaster or other events beyond the reasonable control of the individual subject_to such requirement only distributions that occurred after date are eligible for the waiver under sec_408 of the code revproc_2003_16 2003_4_irb_359 date provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sec_408 the service will consider all relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distribution occurred the information presented and the documentation submitted by taxpayer a is consistent with her assertion that her failure to accomplish a timely rollover of amount was a result of the abusive actions of her spouse which prevented her from managing her financial affairs therefore pursuant to sec_408 of the code the service hereby waives the 60-day rollover requirement with respect to the distribution of amount is granted a period of days from the issuance of thi sec_1 from ira b taxpayer a letter_ruling to contribute amount requirements of sec_408 of the code except the 60-day requirement are met with respect to such contribution the contribution will be considered a rollover_contribution within the meaning of sec_408 into a rollover ira provided all other this ruling does not authorize the rollover of amounts that are required to be distributed by sec_408 of the code no opinion is expressed as to the tax treatment of the transaction described herein under the provisions of any other section of either the code or regulations which may be applicable thereto this letter is directed only to the taxpayer who requested it sec_6110 of the code provides that it may not be used or cited as precedent a copy of this letter_ruling has been sent to your authorized representative pursuant to a power_of_attorney on file in this office this ruling please contact se t ep ra t1 at if you wish to inquire about i d sincerely yours ater a welteins carlton a watkins manager employee_plans technical group enclosures deleted copy of this letter_ruling notice of intention to disclose notice cc


department of the treasury internal_revenue_service washington d c government entities division dec uniform issue list tep rar legend taxpayer a company b company c pian d pian e plan f roth_ira g financial_institution h financial_institution amount amount amount amount dear this is in response to your request for a ruling dated date as supplemented by correspondence dated june and date submitted on your behalf by your authorized representative in which you request relief under sec_301_9100-3 of the procedure and administration regulations p a regulations’ _ the following facts and representations have been submitted under penalties of perjury in support of the ruling requested taxpayer a worked many years for company b and participated in plan d taxpayer a contributed both pre-tax and after-tax contributions to plan d december of taxpayer a’s entire account balance of amount was rolled over to plan e also maintained by company b the record keeper for both plans financial_institution h erred in reporting the portion of taxpayer a’s account attributable to after-tax contributions on form 1099-r for amount was reported as after-tax employee contributions instead of taxpayer a’s actual after-tax contributions amount in plan d in in financial_institution h was replaced by financial_institution on date as part of a bankruptcy reorganization the name of taxpayer a’s employer company b changed to company c and the name of plan e was changed to plan f on date taxpayer a retired on date taxpayer a withdrew her account balance in plan f the distribution included her pre-tax and after-tax contributions the pre-tax portion of her account was to be paid from plan f to financial_institution h to be placed in a traditional individual_retirement_account ira the after-tax portion of her account was to be paid to her to be rolled into roth_ira g the form 1099-r for prepared by financial_institution i reported after-tax employee contributions of amount also in error amount equaled the sum of the erroneous after-tax employee contributions reported in amount and taxpayer a's actual after-tax employee contributions amount taxpayer a’ sec_2012 federal_income_tax return was filed in accordance with the form 1099-r showing amount as taxpayer a’s after-tax contributions to plan f and therefore was reported as being non-taxable in december of company c notified taxpayer a that the after-tax contribution amount amount reported in had been overstated and the error was carried forward in addition the after-tax contribution amount reported on form 1099-r for was also erroneous financial_institution issued a corrected form 1099-r for which shows amount taxpayer a's actual after- tax contributions the erroneous computation of taxpayer a’s after-tax employee contributions in and resulted in an erroneous roll over of taxpayer a’s pre-tax contributions of amount to roth_ira g the ruling_request is accompanied by a letter from company c which states that when it was company b financial_institution h erred when calculating taxpayer a's after-tax employee contributions in and this error was carried forward to in addition financial_institution further erred in reporting taxpayer a’s after-tax contributions in a because of the incorrect reporting of taxpayer a’s after-tax contributions at the time taxpayer a rolled amount into her roth_ira g she was unaware of the need to recharacterize the contribution of amount as having been made to her traditional_ira in accordance with sec_408a of the code based on the foregoing facts and representations you have requested that pursuant to sec_301_9100-3 of the p a regulations taxpayer a be granted an additional period of time to recharacterize the contribution of amount ira g plus earnings on that amount as a contribution made to her traditional_ira to roth with respect to your request for relief under sec_301_9100-3 of the p a regulations code sec_408a and sec_1_408a-5 of the federal_income_tax regulations the i t regulations provide that except as otherwise provided by the secretary a taxpayer may elect to recharacterize an ira contribution made to one type of ira as having been made to another type of ira by making a trustee-to-trustee transfer of the ira contribution plus earnings to the other type of ira in a recharacterization the ira contribution is treated as having been made to the transferee ira and not the transferor ira under sec_408a and sec_1_408a-5 this recharacterization election generally must occur on or before the date prescribed by law including extensions for filing the taxpayer's federal_income_tax return for the year of contributions sec_1_408a-5 q a-2 c of the i t regulations provides in effect that if the amount of the contribution being recharacterized was contributed to a roth_ira and distributions or additional contributions have been made from or to that ira at any time then the net_income attributable to the amount of a contribution being recharacterized is determined by allocating to the contribution a pro-rata portion of the earnings on the assets in the ira during the period the ira held the contribution this attributable net_income is calculated by using the following formula net_income contribution x adjusted closing balance - adjusted opening balance adjusted opening balance the items in the above formula are defined in sec_1_408a-5 q a-2 c of the i t regulations sec_1_408a-5 q a-6 of the i t regulations describes how a taxpayer makes the election to recharacterize the ira contribution to recharacterize an amount that has been converted from a traditional_ira to a roth_ira the taxpayer must notify the roth_ira trustee of the taxpayer’s intent to recharacterize the amount the taxpayer must provide the trustee and the transferee trustee if different from the transferor trustee with specified information that is sufficient to effect the recharacterization and the trustee must make the transfer sec_301_9100-1 sec_301_9100-2 and sec_301_9100-3 of the p a regulations in general provide guidance concerning requests for relief submitted to the service on or after date sec_301_9100-1 provides that the commissioner of internal revenue in his discretion may grant a reasonable extension of the time fixed by a regulation revenue_ruling revenue_procedure notice or announcement published in the internal_revenue_bulletin for the making of an election or application_for relief in respect of tax under among others subtitle a of the code sec_301_9100-2 of the p a regulations lists certain elections for which automatic extensions of time to file are granted sec_301_9100-3 generally provides guidance with respect to the granting of relief with respect to those elections not referenced in sec_301_9100-2 the relief requested in this case is not referenced in sec_301_9100-2 sec_301_9100-3 of the p a regulations provides that applications for relief that fall within sec_301_9100-3 will be granted when the taxpayer provides sufficient evidence including affidavits described in sec_301_9100-3 to establish that the taxpayer acted reasonably and in good_faith and granting relief would not prejudice the interests of the government if the taxpayer’s request for sec_301_9100-3 of the p a regulations provides that a taxpayer will be deemed to have acted reasonably and in good_faith i sec_301_9100-1 relief is filed before the failure to make a timely election is discovered by the service ii if the taxpayer failed to make the election because of intervening events beyond the taxpayer’s control iii if the taxpayer failed to make the election because after exercising reasonable diligence the taxpayer was unaware of the necessity for the election iv the taxpayer reasonably relied upon the written advice of the service or v the taxpayer reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or advise the taxpayer to make the election sec_301_9100-3 of the p a regulations provides that the interests of the government are prejudiced if granting relief would result in a taxpayer having a lower tax_liability in the aggregate for all taxable years affected by the election than the taxpayer would have had if the election had been made timely sec_301_9100-3 of the p a regulations provides that ordinarily the interests of the government will be treated as prejudiced and that ordinarily the service will not grant relief when tax years that would have been affected by the election had it been timely made are closed by the statute_of_limitations before the taxpayer's receipt of a ruling granting relief under this section in this case due to circumstances beyond she needed to elect to recharacterize the contribution of amount as having been made to her traditional_ira in accordance with sec_408a of the code her control taxpayer a was unaware with respect to taxpayers’ request for relief and based on the information and representations submitted the service has concluded that taxpayer a has met the requirements of clauses i ii and iii of sec_301_9100-3 of the regulations and that granting relief would not prejudice the interests of the government therefore taxpayer a is granted a period of days from the date of the issuance of this letter_ruling to recharacterize amount plus earnings on that amount in roth_ira g to her traditional_ira no opinion is expressed as to the tax treatment of the transaction described herein under the provisions of any other section of either the code or regulations which may be applicable thereto this ruling is based on the assumption that the traditional_ira and roth_ira g described above meet the requirements of code sec_408 and sec_408a respectively at all relevant times this letter is directed only to the taxpayers who requested it sec_6110 of the code provides that it may not be used or cited as precedent a copy of this letter_ruling has been sent to your authorized representative pursuant to a power_of_attorney on file in this office this ruling please contact if you wish to inquire about i d at sincerely yours manager employee_plans technical group enclosures deleted copy of this letter notice cc