Court Opinion

ID: 4337394
Source: CourtListenerOpinion
Date Created: 2018-11-14 03:19:51.635037+00
Date Added: 2024-06-11T14:05:20.892833
License: Public Domain

T.C. Memo. 2008-292

                UNITED STATES TAX COURT

        DAVIS AND ASSOCIATES LLC, Petitioner v.
     COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 29211-07L.            Filed December 23, 2008.

     P received a final notice of intent to levy to
collect unpaid employer’s withholding, FICA, and FUTA
tax liabilities. P requested a hearing under sec.
6330, I.R.C. During the administrative hearing P did
not contest the amounts of the underlying unpaid tax
liabilities. D, P’s tax matters partner, submitted on
behalf of P an offer-in-compromise (OIC). D made a
payment of $10,000 with the OIC. The Appeals officer
informed P that she intended to reject the OIC and
suggested that P withdraw the OIC and submit a revised
OIC or request an installment payment agreement. P
withdrew the OIC but did not timely submit a new one or
request an installment payment agreement. P asserts
that D asked the Appeals officer to apply the $10,000
payment that accompanied the OIC to the tax rather than
to penalties or interest.

     Held: This Court lacks jurisdiction in this case
over the allocation among tax, interest, and penalties
of the payment accompanying the OIC submitted in the
                               - 2 -

     sec. 6330, I.R.C., administrative proceeding because
     the allocation among tax, interest, and penalty does
     not affect the amount of the underlying tax liability.

          Held, further, the Court will not consider whether
     P’s payment of tax should have been applied to “trust
     fund penalty amounts” because P did not raise the issue
     in the collection hearing and did not receive with
     respect to that issue a determination from R that we
     have jurisdiction to review.

          Held, further, R’s determination to proceed with
     the levy to collect P’s tax liabilities for the years
     and periods in issue was not an abuse of discretion.

          Held, further, R’s motion for summary judgment
     will be granted.

     C. Paul Davis, for petitioner.

     Veena Luthra, for respondent.

                        MEMORANDUM OPINION

     DAWSON, Judge:   This matter is before the Court on

respondent’s motion for summary judgment pursuant to Rule 121.1

                            Background

     The record establishes and/or the parties do not dispute the

following.

     1
       All Rule references are to the Tax Court Rules of Practice
and Procedure, and all section references are to the Internal
Revenue Code.
                              - 3 -

     Petitioner’s principal office and business was located in

South Boston, Virginia, at the time the petition was filed in

this case.

     This is an appeal from respondent’s determination to proceed

by levy to collect petitioner’s unpaid withholding and FICA tax

liabilities with respect to Forms 941, Employer’s Quarterly

Federal Tax Return, for the taxable quarters ending September 30,

2000; March 31, June 30, September 30, and December 31, 2001;

March 31 and June 30, 2002; March 31, June 30, and December 31,

2003; March 31, June 30, September 30, and December 31, 2004;

March 31, June 30, and September 30, 2005; and March 31 and June

30, 2006; and to collect by levy petitioner’s unpaid FUTA tax

liabilities with respect to Forms 940, Employer’s Annual Federal

Unemployment (FUTA) Tax Return, for the taxable years 2000, 2001,

2004, and 2005.2

     Petitioner filed all the Forms 941 late except for the one

due for the first quarter of 2001.    Petitioner also failed to

timely file its annual unemployment tax returns, Forms 940, until

contacted in 2006 by Revenue Officer Grainer of the Internal

Revenue Service (IRS).

     2
       The term “employment tax” is used to refer to taxes under
the Federal Insurance Contributions Act (FICA), secs. 3101-3128,
the Federal Unemployment Tax Act (FUTA), secs. 3301-3311, and
income tax withholding, secs. 3401-3406 and 3509.
                                  - 4 -

       On February 23, 2007, a Final Notice of Intent to Levy and

Notice of Your Right to a Hearing was sent to petitioner.          The

amounts due on all the returns for which the liabilities were

calculated with respect to the notice of intent to levy totaled

$89,834.18, as follows:

 Form       Tax         Unpaid    Additional   Additional     Amount
 No.       Period       Amounts     Penalty     Interest       Due

 941      9/30/2000   $2,228.65      - 0 -       $105.65    $2,334.30
 940     12/31/2000      474.04       $9.31        12.75       496.10
 941      3/31/2001    1,085.06      - 0 -        135.01     1,220.07
 941      6/30/2001    5,403.28      - 0 -        255.94     5,659.22
 941      9/30/2001    2,948.44      - 0 -        140.21     3,088.65
 940     12/31/2001      465.67        9.85        12.51       488.03
 941     12/31/2001    5,180.51      - 0 -        245.34     5,425.85
 941      3/31/2002    4,031.01      - 0 -      1,132.27     5,163.28
 941      6/30/2002    8,181.71      - 0 -        387.42     8,569.13
 941      3/31/2003    8,519.28      184.17       335.13     9,038.58
 941      6/30/2003    9,228.77      254.00       363.00     9,845.77
 941     12/31/2003    9,276.95      264.32       364.82     9.906.09
 941      3/31/2004      960.74       33.60        39.53     1,033.87
 941      6/30/2004    3,893.03      136.98       177.97     4,207.98
 941      9/30/2004    1,685.40       67.54        80.17     1,833.11
 940     12/31/2004      505.16       12.44        13.57       531.17
 941     12/31/2004    4,883.38      180.48       231.03     5,294.89
 941      3/31/2005    1,551.21       64.98        73.77     1,689.96
 941      6/30/2005    2,429.64      104.35       115.55     2,649.54
 941      9/30/2005    5,003.39      197.37       236.62     5,437.38
 940     12/31/2005      516.52       13.53        13.88       543.93
 941      3/31/2006    2,831.92      138.71       132.35     3,102.98
 941      6/30/2006    2,078.15       97.96        98.19     2,274.30

       On March 14, 2007, the IRS received petitioner’s Form 12153,

Request for a Collection Due Process Hearing, in response to the

Final Notice of Intent to Levy and Notice of Your Right to a

Hearing, with respect to the proposed levy.        The request was

submitted on petitioner’s behalf by C. Paul Davis (Mr. Davis), a

50-percent owner of petitioner, its tax matters partner, and the
                                - 5 -

person responsible for depositing its employment taxes.    In the

request, Mr. Davis did not express a reason for disagreeing with

the proposed levy.

     By letter dated May 15, 2007, Settlement Officer Anh T.

Munson (Appeals officer) requested that petitioner send to her

(1) proof of Federal tax deposits for the first two quarters of

2007, (2) a Form 433-B, Collection Information Statement for

Businesses, (3) petitioner’s signed Form 1065, U.S. Return of

Partnership Income, for 2006, and (4) the Form 940 for the

taxable year 2006.   By the time of the telephone Appeals hearing

on May 31, 2007, petitioner had not sent the requested

information.   However, the requested documents were received

after the hearing.

     At petitioner’s telephone Appeals hearing, Mr. Davis stated

that petitioner was in the process of obtaining a loan against

business real property and that petitioner would use the proceeds

for submitting an offer-in-compromise.

     On June 4, 2007, petitioner submitted an offer-in-compromise

of $50,000 ($10,000 paid with the offer and $40,000 to be paid

within 5 months after acceptance of the offer) for all of the

outstanding tax liabilities.    Petitioner had applied for a bank

loan of $50,000 against the real estate to make the offer-in-

compromise.    Included with the offer were a $10,000 check and a

$150 check for the application fee.     Section V, Part (b) of Form
                               - 6 -

656, Offer in Compromise, states that the amount sent with the

offer will be applied to the tax liability unless it is specified

as a deposit.   Petitioner did not specify the payment as a

deposit, and the $10,000 was applied to the Form 941 tax

liabilities for the third quarter of 2000 and the first three

quarters of 2001.

     On June 7, 2007, the Appeals officer advised petitioner that

the Federal tax deposits for the first two quarters of 2007 had

been made late and that the offer-in-compromise might not be

processed if petitioner was not current on the Federal tax

deposits.   Petitioner agreed to make timely deposits in the

future and to forward to the Appeals officer its Form 941 for the

first quarter of 2007.   That return was received on June 13,

2007, with petitioner’s check and payment voucher.   The balance

of the Form 941 liability was not paid in full by that date, and

the partial payment made with the filing of the return was made

late.

     By a faxed letter dated September 24, 2007, and by telephone

the same day, the Appeals officer informed petitioner through Mr.

Davis that the offer-in-compromise would not be accepted.     The

Appeals officer determined the petitioner had an asset equity of

$39,879 and future income potential of $17,904, and therefore the

minimum acceptable offer would be $57,783.   Petitioner was

advised that another collection alternative could be submitted by
                                - 7 -

October 5, 2007.    In response, Mr. Davis, in a letter dated

October 15, 2007, withdrew the offer-in-compromise on behalf of

petitioner and indicated that another proposal would be

submitted.   Mr. Davis also indicated that he had applied for a

loan and hoped to have an answer for the Appeals officer by

October 22, 2007.

     On October 29, 2007, the Appeals officer contacted Mr. Davis

regarding petitioner’s failure to submit a proposed collection

alternative.   Mr. Davis then indicated that petitioner might

request an installment payment agreement and that he would

contact the Appeals officer again in 1 week.    The Appeals officer

informed Mr. Davis that if a proposed collection alternative was

not received by November 6, 2007, she would begin action to

sustain the levy.    Not having heard from Mr. Davis on or before

November 6, 2007, nor having received a proposed collection

alternative, the Appeals officer proceeded on November 7, 2007,

to prepare her report sustaining the levy.

     On November 14, 2007, the Appeals officer’s summary and

recommendation to sustain the proposed levy action was approved

by the Appeals team manager, and the Notice of Determination

Concerning Collection Action(s) Under Section 6320 and/or 6330

was sent to petitioner sustaining the proposed levy and returning

the case to the Compliance Office for appropriate action.
                              - 8 -

     An attachment to the notice of determination sustaining the

notice of intent to levy stated in pertinent part:

                        Brief Background

          Our records indicate your business, Davis &
     Associates LLC, is a retail store established in 1997
     to sell and service SEARS merchandise. You filed the
     940 and 941 tax returns timely until mid 2000. When
     contacted by the IRS in 2006 for the delinquent 941 and
     940 tax returns, you filed all the required tax returns
     from 2000 to 2006 with the Compliance Office. Your
     current tax liability is about $84,000.

          The Compliance Office contacted you for payment
     resolution of your taxes but you did not submit an
     acceptable payment plan. Therefore, the Compliance
     office issued the Notice of Intent to Levy on the above
     listed tax periods. You appealed the proposed levy
     action with claim the levy would cause you financial
     hardship.

          The Appeals Office offered a telephone hearing on
     May 31, 2007. Prior to the hearing, the Appeals Office
     requested you to provide proofs of federal tax
     deposits, financial information on Form 433-B and
     submit a collection alternative. At the hearing, you
     stated you were in the process of obtaining a loan
     against business real property and would use the loan
     proceeds for an offer-in-compromise. You submitted
     Form 656 on 06-04-2007 and offered $50,000 to
     compromise all your outstanding tax liabilities.

          Based on your financial information, the Appeals
     Office determined your reasonable collection potential
     was more than the tax liability, therefore, it would
     not be accepted. You later withdrew the offer-in-
     compromise and stated you would propose an installment
     agreement later.

          So far, you have not submitted an acceptable
     collection alternative.
                         - 9 -

              1. Discussion and Analysis

Verification of legal and procedural requirements:

     Appeals has obtained verification from the IRS
office collecting the tax that the requirements of any
applicable law, regulation or administrative procedure
with respect to the proposed levy or lien filing have
been met. Computer records indicate that the notice
and demand, notice of intent to levy and/or notice of
federal tax lien filing, and notice of a right to a
Collection Due Process (CDP) hearing were issued.

     Assessment was properly made per IRC § 6201 for
each tax period listed on the CDP notice.

     The notice and demand for payment letter was
mailed to the taxpayer’s last known address, within 60
days of the assessment, as required by IRC §6303.

     There was a balance due when the CDP levy notice
was issued and/or when the lien was filed.

Prior involvement:

     This Settlement Officer has had no prior
involvement with respect to the specific tax periods
either in Appeals or Compliance.

Collection statute verification:

     The collection statute has been suspended; the
collection period allowed by statute to collect these
taxes has been suspended by the appropriate computer
codes for the tax periods at issue.

     Collection followed all legal and procedural
requirements and the actions taken or proposed were
appropriate under the circumstances.

           2. Issues Raised by the Taxpayer

Collection Alternatives Offered by Taxpayer

     You withdrew your offer-in-compromise after being
advised that your offer would not be accepted. So far
you have not submitted another collection alternative.
                             - 10 -

     Challenges to the Existence of Amount of Liability

          Prior to the hearing, the tax transcripts were
     provided to you for review. You did not dispute the
     tax liability since the assessments were based on your
     tax returns.

     Other Issues: You claimed no other issue.

   3. Balancing of need for efficient collection with taxpayer
  concern that the collection action be no more intrusive than
                            necessary.

          Appeals has verified, or received verification,
     that applicable laws and administrative procedures have
     been met; has considered the issues raised; and has
     balanced the proposed collection with the legitimate
     concern that such action be no more intrusive than
     necessary by IRC Section 6330(c)(3).

          Collection alternatives include full payment,
     installment agreement, offer-in-compromise, and
     currently-not collectible. Since you have not
     submitted an acceptable collection alternative, the
     Appeals Office determines the proposed levy action is
     appropriate and balances the need for the efficient
     collection of the taxes with the legitimate concern
     that any collection action be no more intrusive than
     necessary. The IRS Compliance Office may proceed with
     appropriate collection actions.

     On December 17, 2007, petitioner filed its petition herein,

claiming that petitioner thought an installment payment agreement

was in the process of being arranged, disputed the penalties and

interest charged on the past due tax liabilities, and disputed

the application of a portion of the payment ($10,000)

accompanying the offer-in-compromise to those penalties and

interest.

     When respondent filed his motion for summary judgment on

July 9, 2008, the Court ordered petitioner to file a response to
                              - 11 -

the motion on or before August 15, 2008.   Petitioner did not file

a response.   Mr. Davis appeared at the Court’s Richmond trial

session on September 8, 2008, and, on the basis of petitioner’s

motion for continuance filed on September 2, 2008, requested

additional time to file a response to respondent’s motion for

summary judgment.   The Court denied the motion for continuance

but extended the time for filing a response to respondent’s

motion for summary judgment to September 25, 2008.   On September

23, 2008, the McKee CPA Office, P.C., of Cary, North Carolina,

filed a response on petitioner’s behalf.   The response, in part,

contends that (1) petitioner made payments in excess of the trust

fund amounts (employee withholding) and no trust fund recovery

penalty should be assessed on the employee tax withheld; (2)

petitioner calculated its unpaid balance due on the tax returns

at issue as $23,663 rather than the unpaid balance of tax,

penalty, and interest ($89,834.18) assessed by respondent, based

on the delinquent tax returns petitioner filed; and (3)

petitioner should now be permitted to pay its unpaid taxes in

installments of $500 per month until the balance due is paid in

full.   In a separate statement, apparently prepared for

petitioner by Mr. Davis and attached to the response, there are

assertions that petitioner no longer has a viable bank line of

credit; the real estate housing the retail store is heavily

mortgaged with “no further credit available”; and, in view of
                             - 12 -

present economic conditions, petitioner is in a “survival mode”

with “the lowest level of sales in its history”.

                           Discussion

     Summary judgment is intended to expedite litigation and

avoid unnecessary and expensive trials.     Fla. Peach Corp. v.

Commissioner, 90 T.C. 678, 681 (1988).     Summary judgment may be

granted where there is no genuine issue of any material fact and

a decision may be rendered as a matter of law.    Rule 121(a) and

(b); see Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520

(1992), affd. 17 F.3d 965 (7th Cir. 1994).    The moving party

bears the burden of proving that there is no genuine issue of

material fact, and factual inferences will be read in a manner

most favorable to the party opposing summary judgment.     Dahlstrom

v. Commissioner, 85 T.C. 812, 821 (1985).

     If a taxpayer liable for taxes fails to pay those taxes

within 10 days after notice and demand for payment is made,

section 6331(a) authorizes the Secretary to levy against the

taxpayer’s property and property rights.    Section 6331(d)

requires the Secretary to send the taxpayer written notice of the

Secretary’s intent to levy, and section 6330(a) requires the

Secretary to send the taxpayer written notice of his right to a

collection hearing at least 30 days before any levy is begun.

     If the taxpayer requests a collection hearing, it will be

held before an impartial officer or employee of the IRS Office of
                               - 13 -

Appeals.   Sec. 6330(b)(1), (3).   The Appeals officer conducting

the hearing must verify that the requirements of any applicable

law or administrative procedure have been met.   Sec. 6330(b)(1),

(c)(1).    The taxpayer may raise any relevant issue with regard to

the Commissioner’s intended collection activities, including

spousal defenses, challenges to the appropriateness of the

proposed levy, and alternative means of collection.   Sec.

6330(c)(2)(A); see Sego v. Commissioner, 114 T.C. 604, 609

(2000); Goza v. Commissioner, 114 T.C. 176, 180 (2000).      The

taxpayer may not contest the existence or amount of the

underlying tax liability if the taxpayer received a statutory

notice of deficiency with respect to the underlying tax liability

or otherwise had an opportunity to dispute that liability.      Sec.

6330(c)(2)(B).    Taxpayers are expected to provide all relevant

information requested by Appeals, including financial statements,

for its consideration of the facts and issues involved in the

hearing.    Sec. 301.6330-1(e)(1), Proced. & Admin. Regs.

     Following a collection hearing, the Appeals Office must make

a determination whether the proposed levy may proceed.      In so

doing, the Appeals officer is required to take into

consideration:    (1) The verification presented by the Secretary

that the requirements of applicable law and administrative

procedures have been met, (2) the relevant issues raised by the

taxpayer, and (3) whether the proposed levy action appropriately
                               - 14 -

balances the need for efficient collection of taxes with a

taxpayer’s concerns regarding the intrusiveness of the proposed

levy action.    Sec. 6330(c)(3).   A hearing officer may rely on a

computer transcript or Form 4340, Certificate of Assessments,

Payments, and Other Specified Matters, to verify that a valid

assessment was made and that a notice and demand for payment was

sent to the taxpayer in accordance with section 6303.       Nestor v.

Commissioner, 118 T.C. 162, 166 (2002); Schaper v. Commissioner,

T.C. Memo. 2002-203; Schroeder v. Commissioner, T.C. Memo. 2002-

190.    Absent a showing of irregularity, a transcript that shows

such information is sufficient to establish that the procedural

requirements of section 6330 have been met.     Nestor v.

Commissioner, supra at 166-167; see sec. 6330(c)(3).

       Where the underlying tax liability is properly at issue, we

review the determination de novo.    E.g., Goza v. Commissioner,

supra at 181-182.   Where the underlying tax liability is not at

issue, we review the determination for abuse of discretion. Id.

at 182.    The Appeals officer abuses his or her discretion if the

determination was made “arbitrarily, capriciously, or without

sound basis in fact.”    Mailman v. Commissioner, 91 T.C. 1079,

1084 (1988).    In reviewing for abuse of discretion under section

6330(d)(1), generally we consider only arguments, issues, and

other matters that were raised at the collection hearing or

otherwise brought to the attention of Appeals.     Magana v.
                              - 15 -

Commissioner, 118 T.C. 488, 493 (2002); see also sec. 301.6330-

1(f)(2), Q&A-F3, Proced. & Admin. Regs.   Whether an abuse of

discretion has occurred depends upon whether the exercise of

discretion is without sound basis in fact or law.    Freije v.

Commissioner, 125 T.C. 14, 23 (2005).

     Petitioner filed delinquent Forms 940 and 941 tax returns

for years and/or quarters from 2000 through June 30, 2006.

Before the telephone Appeals hearing with the Appeals officer,

tax transcripts were provided to petitioner for review. The

amounts assessed were based on the tax returns petitioner had

filed, and Mr. Davis did not dispute the amount of the underlying

liabilities during the collection hearing process.

     In its petition, petitioner requested an abatement of

penalties and interest.   The penalties and interest are based on

petitioner’s self-reported employment taxes due for various

periods from 2000 to 2006.   However, petitioner is barred from

challenging the penalties and interest because Mr. Davis did not

raise them in the collection hearing.

     Petitioner asserts that, when Mr. Davis discussed

withdrawing the offer-in-compromise with the Appeals officer, he

requested that the $10,000 submitted with the offer be applied to

its tax liabilities and not to penalties and interest and that he

thought the Appeals Officer agreed to do so.   The Tax Court is a

court of limited jurisdiction and may exercise only the power
                              - 16 -

conferred by statute.   Raymond v. Commissioner, 119 T.C. 191, 193

(2002).   The existence of jurisdiction in a particular case is

fundamental and may be raised at any point in the proceeding,

either by a party or by the Court sua sponte.     Smith v.

Commissioner, 124 T.C. 36, 40 (2005).     The Court sua sponte

questioned whether we have jurisdiction in these proceedings over

the application of the payment submitted with the offer-in-

compromise.

     In Landry v. Commissioner, 116 T.C. 60 (2001), we held that

this Court has jurisdiction in a levy action under section 6330

over the application of credits for overpayments of tax reported

on the taxpayer’s income tax returns for years preceding the

years giving rise to the tax liabilities subject to the proposed

levy.   We held: “Because the validity of the underlying tax

liability, i.e., the amount unpaid after application of credits

to which petitioner is entitled, is properly at issue, we review

respondent’s determination de novo.” Id. at 62.   Similarly, in

Freije v. Commissioner, supra, we held that we have jurisdiction

in a levy action under section 6330 to decide whether a payment

made during one of the years at issue was improperly credited to

an earlier year not before the Court.

     In this case the amount remaining unpaid after application

of the $10,000 payment made with the offer-in-compromise is

$79,834.18 ($89,834.18 - $10,000).     That amount is the same
                              - 17 -

regardless of whether the payment is applied to tax, penalty, or

interest, and respondent may levy against petitioner’s property

to recover $79,834.18 regardless of whether it represents tax,

penalty, or interest.   Landry and Freije are therefore

distinguishable and do not apply.    Thus, we conclude that this

Court does not have jurisdiction in this case under section

6330(d)(1) to decide how the payment made with the offer-in-

compromise submitted to the Appeals officer during the collection

hearing is to be allocated among tax, penalty, and interest.

     In its response to respondent’s motion for summary judgment,

petitioner contends that petitioner made payments in excess of

the trust fund amounts (employee withholding) and no “trust fund

recovery penalty” should be assessed on the employee tax

withheld.   We surmise that petitioner is concerned that the IRS

may impose the 100-percent penalty under section 6672 against Mr.

Davis, as petitioner’s responsible officer and that he would be

liable for the “trust fund amounts” withheld from employees’

wages and not paid over to the IRS.    That penalty is not the

subject of the proposed levy on petitioner’s property and thus

not an issue properly before us.    Moreover, we generally may

consider only those issues that the taxpayer raised during the

collection hearing or otherwise brought to the attention of the

Appeals Office.   Sec. 6330(c) and (d)(1); Giamelli v.

Commissioner, 129 T.C. 107, 115 (2007); sec. 301.6320-1(e),
                              - 18 -

Proced. & Admin. Regs.   Consequently, we may not consider whether

petitioner’s payments of tax should have been applied to the

“trust fund amount” because petitioner did not raise the issue in

the collection hearing and did not receive with respect to that

issue a determination that we have jurisdiction to review.

Similarly, we will not consider whether the amount of the unpaid

tax liability is less than the $89,834.18 respondent assessed (as

reduced by the $10,000 payment) because petitioner did not raise

the issue during the collection hearing.

     The amount of the unpaid tax is not at issue.   Consequently,

we will review the administrative determination of the Appeals

Office for abuse of discretion.   Sego v. Commissioner, 114 T.C.
604, 610 (2001); Goza v. Commissioner, 114 T.C. 176, 182 (2000).

     As summarized in the Appeals officer’s attachment to

respondent’s notice of determination, the Appeals officer

verified that all requirements of applicable law and

administrative procedures were met.    She had no prior involvement

with respect to the unpaid tax.   She considered whether the

proposed collection action is more intrusive than necessary.   The

alternative to collection that was submitted to her was an offer-

in-compromise.   After petitioner was informed that the offer-in-

compromise would not be accepted, petitioner withdrew the offer

and did not submit another offer or collection proposal in the
                                - 19 -

form of an installment payment agreement within the reasonable

time limitation set by the Appeals officer.

      We point out that consideration of collection alternatives

is a nonliability issue that is reviewed for an abuse of

discretion.    See Olsen v. United States, 414 F.3d 144, 153 (1st

Cir. 2005).     If an Appeals officer follows the prescribed

guidelines in determining whether a collection alternative is

acceptable, his or her conclusion generally will be considered

reasonable and not an abuse of discretion.     See Moorhous v.

Commissioner, T.C. Memo. 2003-183; Rodriguez v. Commissioner,

T.C. Memo. 2003-153; Schenkel v. Commissioner, T.C. Memo. 2003-

37.   Petitioner does not assert that prescribed guidelines were

not followed in evaluating the offer.     Furthermore, petitioner

withdrew the offer-in-compromise that was filed, leaving no other

collection alternative for the Appeals officer to consider.

      Petitioner disputes that the Appeals officer acted correctly

with regard to an installment payment agreement.     However, the

Appeals officer could not consider that collection alternative

when petitioner proposed no specific plan.     Petitioner claims

that an installment payment agreement was in the process of being

arranged.     However, the Appeals officer informed petitioner on

October 29, 2007, that if a proposed collection alternative was

not received within 1 week, the proposed levy action would be

sustained.     Because petitioner had not contacted the Appeals
                                - 20 -

officer or submitted a collection alternative by November 6,

2007, the proposed levy action was sustained.    The levy action

was sustained a month from the deadline to submit another

collection alternative given by the Appeals officer, after

petitioner was notified the offer-in-compromise would not be

accepted, and over 3 weeks from the date petitioner withdrew the

offer-in-compromise.    In these circumstances the Appeals officer

did not abuse her discretion by refusing to allow petitioner any

additional time.    See Kindred v. Commissioner, 454 F.3d 688, 697-

698 (7th Cir. 2006) (sustaining the levy after giving taxpayers

an additional 2 weeks was not an abuse of discretion).

     Accordingly, we hold that there is no issue as to any

material fact; that the Appeals officer committed no abuse of

discretion in rejecting the offer-in-compromise of $50,000 as

insufficient in relation to the collection potential of $57,783;

that the determination to proceed with the levy was not an abuse

of discretion; and that respondent is entitled to judgment as a

matter of law.     Respondent’s motion for summary judgment will be

granted.

     To reflect the foregoing,

                                      An appropriate order and

                                 decision will be entered.