Court Opinion

ID: 855488
Source: CourtListenerOpinion
Date Created: 2013-03-18 20:29:46.184855+00
Date Added: 2024-06-11T13:22:36.259473
License: Public Domain

T.C. Memo. 2013-79

                         UNITED STATES TAX COURT

                   MICHAEL J. HARPER, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent

      Docket No. 20408-11L.                         Filed March 18, 2013.

      Michael J. Harper, pro se.

      Rebecca M. Clark, for respondent.

                           MEMORANDUM OPINION

      CHIECHI, Judge: This case is before us on respondent’s motion for sum-

mary judgment (respondent’s motion). We shall grant respondent’s motion.

                                    Background

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

      Petitioner’s mailing address was in Michigan at the time he filed the petition.
                                          -2-

[*2] Petitioner did not file a Federal income tax (tax) return for his taxable year

2007.1 Respondent prepared a substitute for return for that year.

      Respondent issued to petitioner a notice of deficiency with respect to his

taxable year 2007 (2007 notice of deficiency). In that notice, respondent deter-

mined a deficiency in, and certain additions to, petitioner’s tax for that year.

Petitioner did not file a petition with the Court with respect to the 2007 notice of

deficiency.

      On May 24, 2010, respondent assessed the tax and the additions to tax for

petitioner’s taxable year 2007 that respondent had determined in the 2007 notice of

deficiency as well as interest as provided by law thereon. (We shall refer to the

amounts that respondent assessed on May 24, 2010, as well as interest as provided

by law accrued after that date, as the 2007 unpaid liability.)

      On May 24, 2010, and on certain dates thereafter, respondent issued to

petitioner notices of balance due with respect to his 2007 unpaid liability.

      On January 18, 2011, respondent issued to petitioner a final notice of intent to

levy and notice of your right to a hearing (notice of intent to levy) with respect to his

2007 unpaid liability.

      1
       Moreover, petitioner did not file a tax return for any of his taxable years
2004, 2005, 2006, 2008, and 2009. Respondent prepared a substitute for return for
each of those years.
                                         -3-

[*3] Petitioner timely filed with respondent Form 12153, Request for a Collection

Due Process or Equivalent Hearing (petitioner’s Form 12153), and requested a

hearing with respondent’s Appeals Office (Appeals Office). In that form, petitioner

indicated his disagreement with the notice of intent to levy.2 In petitioner’s Form

12153, petitioner requested an installment agreement and an offer-in-compromise as

collection alternatives.

      By letter dated March 23, 2011 (March 23, 2011 letter), a settlement officer

with the Appeals Office (settlement officer) who was assigned petitioner’s Form

12153 acknowledged receipt of that form. That letter stated in pertinent part:

      Appeals received your request for a Collection Due Process (CDP)
      Hearing. I have scheduled a telephone conference call for you on
      May 11, 2011 at 1:00pm EST.[3] This call will be your primary
      opportunity to discuss with me the reasons you disagree with the
      collection action and/or to discuss alternatives to the collection action.

      2
        In petitioner’s Form 12153, petitioner also indicated his disagreement with a
notice of Federal tax lien filing. The record does not establish that respondent
issued to petitioner any such notice with respect to his taxable year 2007. The
notice of determination concerning collection action(s) under sec. 6320 and/or 6330
(notice of determination) with respect to petitioner’s taxable year 2007 on which
this case is based addresses solely the notice of intent to levy that respon-dent
issued to petitioner with respect to his taxable year 2007.
      3
      We shall refer to the telephonic conference with petitioner that the settle-
ment officer scheduled for May 11, 2011, as the scheduled telephonic conference.
                                          -4-

[*4] I will call you at * * *, the number you indicated on your CDP
     request.

      If this time is not convenient for you, the phone number has changed,
      or you would prefer your conference to be held by face-to-face at
      the Appeals office closest to your current residence, the school you
      attend or your place of employment or if you are a business, your
      business address, or by correspondence, please let me know within
      fourteen (14) days from the date of this letter, no later than May 5,
      2011. I will discuss with you if there are any offices that may be more
      convenient for you (e.g., Appeals office nearest place of employment
      or school) when you contact me.

      Your attached letter requests a face to face hearing. In order to
      have a face to face you must be in full compliance. Our records
      indicate that you are currently missing you [sic] 2004 and 2009[4]
      tax returns. Enclosed you will find the 1040’s with the reported
      income for these years. * * * complete and sign these forms [1040]
      and fax them to me at the fax number listed above and also send
      me the completed [Form] 433A also enclosed by April 5, 2011, I
      will be able to transfer your case at that time for a face to face
      hearing. If I do not receive this information by April 5, 2011 you
      will still be eligible for the telephone conference.

          *         *           *          *           *          *           *

      4
        The attachment to the notice of determination that respondent issued to
petitioner with respect to his taxable year 2007 (quoted in pertinent part in the text
below) stated that respondent did not have any tax returns from petitioner for his
taxable years 2004 through 2009. It is immaterial to our resolution of respon-dent’s
motion that the settlement officer’s March 23, 2011 letter is inconsistent in this
regard with that attachment to the notice of determination. The record establishes
that petitioner did not file a tax return for any of his taxable years 2004, 2005, 2006,
2007 (the taxable year involved here), 2008, and 2009. See supra note 1.
                                        -5-

[*5] During the hearing, I must consider:

         •    Whether the IRS met all the requirements of any applicable
              law or administrative procedure

         •    Any non frivolous issues you wish to discuss. These can
              include:

              1.   Collection alternatives to levy such as full payment of the
                   liability, installment agreement, offer in compromise or
                   temporary suspension of collection action if the action
                   imposes a hardship condition. Although they may not be
                   considered an “alternative” to a notice of lien filing, these
                   collection options may also be discussed at a lien hearing.

              2.   Challenges to the appropriateness of collection action. If
                   this is a lien hearing, you may ask us to determine if the
                   notice of lien filing was appropriate and if you qualify for
                   a lien withdrawal or other lien options, such as subordina-
                   tion.

              3.   Spousal defenses, when applicable.

         •    We may also consider whether you owe the amount due, but
              only if you have not otherwise had an opportunity to dispute it
              with Appeals or did not receive a statutory notice of defi-
              ciency.

         •    We will balance the IRS’ need for efficient tax collection and
              your legitimate concern that the collection action be no more
              intrusive than necessary.

        *          *           *          *           *          *            *

      For me to consider alternative collection methods such as an install-
      ment agreement or offer in compromise, you must provide any
                                        -6-

[*6] items listed below. In addition, you must have filed all federal tax
     returns required to be filed.

         •    A completed Collection Information Statement (Form 433-
              A for individuals and/or Form 433-B for businesses.)

         •    Signed tax return(s) for the following tax periods. Our
              records indicate they have not been filed:
              Type of Tax: 1040
              Period or Periods: 2004 and 2009

         •    Proof of estimated tax payments for the period(s) listed
              below:
              2001 or a corrected W4

         •    Other All income and expense substantiation and three
              months of bank statements

         •    Form 656 Offer in Compromise

      Please send me the items requested above within 14 days from the
      date of this letter, no later than May 5, 2011. I cannot consider
      collection alternatives at your conference without this information. I
      am enclosing the applicable forms and a return envelope for your
      convenience.

         *          *          *          *           *          *          *

      If you do not participate in the conference or respond to this letter, the
      determination and/or decision letter that we issue will be based on your
      CDP request, any information you previously provided to this office
      about the applicable tax periods, and the Service’s administrative file
      and records.

      In response to the settlement officer’s March 23, 2011 letter, on May 8,

2011, three days before the scheduled telephonic conference, petitioner sent a
                                           -7-

[*7] letter (May 8, 2011 letter) to the settlement officer. In that letter, petitioner

stated in pertinent part:

       You sent me your letter dated March 23, 2011 that was in response to
       my request for CDP Hearing, the copy attached. In response to your
       letters, I do not wish to have a telephone conference nor do I wish to
       discuss this matter via correspondence since the majority of my ques-
       tions over the years pertaining to this matter have gone unanswered.

       I requested a face-to-face hearing as I am entitled to under the law.
       The things I will discuss include collection alternatives, including OIC
       and payment schedule, procedural irregularities, and possibly Currently
       Non Collectible. Please send me the necessary forms, including the
       financial statement form.

       What I am requesting is an in-person meeting as prescribed by law.
       ***

         *           *           *           *           *           *           *

       I would like a copy of all information, documentation and the adminis-
       trative records you have on us before the CDP Hearing. Please send
       me Form 4340 with the transcripts and certificate. This is necessary
       for my CDPH.

       At the hearing, I will bring a tape recorder and a few witnesses to
       observe the process. Please schedule the Hearing at the IRS office
       closest to my residence and notify me of the date, time and place.
       Please contact security and make arrangements for me to bring my tape
       recorder, etc. through the security check point.

       In your letter, you stated I would be allowed a face-to-face conference
       on any relevant, non-frivolous issues if I requested this in writing. Is
       this still correct? I have listed above in this letter the issues that will be
       raised. These will not exclude me from the face-to-face confer-
                                          -8-

[*8]   ence. Please respond to my issues and concerns, and please provide me
       with the information I have requested from you.

       As for this form 433-A and the other forms you have requested from
       me, there are no laws that require me to fill out this form before you
       schedule a face to face hearing. In fact in Brandt v. Commissioner,
       T.C. 2009-16 a Collection hearing was held, but yet the taxpayer had
       not filed the applicable forms and was in fact granted an extension of
       28 days beyond the date of the hearing to do so. You requested that I
       complete a comprehensive financial form within 14 days. Not only do
       you want the paperwork in advance of the scheduling of the hearing,
       but you are only giving me less than half that time to complete it.

       I will work with appeals to provide all the necessary forms. At the
       hearing, I will bring copies of my books and records. Please schedule
       the hearing 90 days in advance so I can arrange my schedule.

       After having received the May 8, 2011 letter from petitioner, the settlement

officer called him to inform him that a face-to-face hearing could not be held until he

provided the settlement officer with the information and the documents that the

settlement officer had requested in her March 23, 2011 letter. Petitioner did not

respond to that telephone call.

       On May 11, 2011, the date of the scheduled telephonic conference, the

settlement officer called petitioner, but petitioner was not available. On the same

date, after petitioner failed to participate in the scheduled telephonic conference, the

settlement officer sent him a letter (May 11, 2011 letter). In that letter, the settle-

ment officer stated in pertinent part:
                                         -9-

[*9] I sent you a letter dated March 23, 2011 offering you a telephonic
     Collection Due Process conference. The conference was scheduled for
     May 11, 2011 at 1:00pm EST.

      I tried calling you at the scheduled time but you were not available and
      you had not called to indicate that this date and/or time was not conve-
      nient.

      The conference letter also asked that you send me the information I
      needed to consider the issues you raised in your request for a hearing.

          •    I never received the information from you.

      Please be advised that we will make a determination in the Collection
      Due Process hearing you requested by reviewing the Collection admin-
      istrative file and whatever information you have already provided.

      If you would like to provide information for our consideration, please
      do so within 14 days from the date on this letter, no later than May 25,
      2011.

      We will promptly issue you a determination and/or decision letter with
      our findings.

      In July 2012, petitioner sent one check or two checks to respondent with

respect to his respective tax liabilities for his taxable years 2005 and 2006.5 The

checks were dishonored, and respondent charged petitioner dishonored check fees.

      5
         The record does not establish whether petitioner sent one check with respect
to his tax liability for his taxable year 2005 and one check with respect to his tax
liability for his taxable year 2006 or whether he sent one check with respect to his
respective liabilities for both of those years. For convenience, we assume and state
hereafter that petitioner sent two checks to respondent.
                                         - 10 -

[*10] On August 10, 2011, the Appeals Office issued to petitioner a notice of

determination with respect to his taxable year 2007. That notice stated in pertinent

part:

        Summary of Determination

        Appeals has determined that your Notice of Intent to Levy is sustained.

        The notice of determination included an attachment that stated in pertinent

part:

                    SUMMARY AND RECOMMENDATION

        You requested a Collection Due Process Hearing under authority of
        IRC Code 6330 in response to the proposed levy action on the above
        accounts. The request was timely as it was received within 30 days
        from the date of the levy notice.

        Appeals has determined that the Notice of Intent to Levy is sustained.

                              BRIEF BACKGROUND

        On March 23, 2011 the Settlement Officer sent you a letter which
        scheduled a telephone conference for you on May 11, 2011 at 1:00pm
        EST. You were offered the opportunity to request a face to face
        conference but you did not send any of the requested information that
        was needed in order for the Settlement Officer to consider it for you.
        In the letter, you were asked to provide Form 433A, collection infor-
        mation statement with all income and expense substantiation and three
        months of bank statements along with Form 1040 for tax years 2004
        through 2009, estimated tax payments for 2011 or a corrected W4 and
        Form 656 for the offer in compromise you requested. The
                                       - 11 -

[*11] Settlement Officer did not receive any of the requested information
      from you.

      On May 8, 2011, the Settlement Officer received a letter from you
      requesting a face to face conference. The Settlement Officer called
      you to advise you that a face to face could not be granted until you sent
      the requested information. You did not respond to that telephone
      attempt.

      On May 11, 2011 the Settlement Officer called you for your scheduled
      conference, You were not available. You were advised that the call
      was in reference to you collection due process and that a letter would
      be sent dated May 11, 2011. The Settlement Officer sent you the letter
      which stated that the telephone conference was attempted and that you
      had 14 days from the date of the letter which was by May 25, 2011 for
      you to provide any information you wished to be considered prior to
      determination on your account. You were to provide this information
      within 14 days, no later than May 25, 2011; The Settlement Officer did
      not receive any information.

                        DISCUSSION AND ANALYSIS

            a. Verification of legal and procedural requirements:

                 Appeals has obtained verification from the IRS office col-
                 lecting the tax that the requirements of any applicable law,
                 regulation or administrative procedure with respect to the
                 proposed levy or NFTL 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 hearing were issued.

                 Assessment was properly made per IRC § 6201 for each
                 tax and period listed on the CDP notice.
                                          - 12 -

[*12]              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 or when the NFTL filing was requested.

                   There is no pending bankruptcy case, nor did you have a
                   pending bankruptcy case at The Time the CDP was sent
                   (11USC § 362(a)(6).

        Prior involvement

        The Settlement Officer 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 al-
        lowed 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.

                            Issues raised by the taxpayer

        Collection Alternatives Offered by Taxpayer

        You requested the collection alternative of an installment agreement or
        an offer in compromise but you did not provide any of the requested
        information in order for the Settlement Officer to consider one for you.

        Challenges to the Existence of Amount of Liability

        You disagree with your liability because you state that the tax
                                        - 13 -

[*13] assessments were incorrect but you did not provide any information
      showing why. You annotated subordination, discharge or withdrawal of a
      lien. Our records show that the Notice of Federal Tax Lien has not been
      filed.

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

      The proposed collection action has been determined to be appropriate
      in you case. Although a levy is intrusive a levy is the most efficient
      method of collection remaining. You did not send in any requested
      information in order for the Settlement Officer to explore for collection
      alternatives. It is our judgment that the proposed levy action balances
      the need for efficient collection with your legitimate concern that the
      collection action be no more intrusive than necessary. [Reproduced
      literally.]

      In the petition commencing this case, petitioner alleged in pertinent part:

            2.   Pursuant to IRC §§ 6320 and 6330, Petitioner requested a
                 face-to-face Collection Due Process Hearing for the tax
                 period 2007 within the 30-day time period allowed by
                 statute, dated February 7, 2011. (Certificate of Service--
                 Exhibit B).

            3.   The IRS Appeals Office issued a “Notice of Determination
                 Concerning Collection Action under Section 6320 and/or
                 6330” dated August 10, 2011. This denied Petitioner’s
                 lawful request and is hereby appealed. (Exhibit C).

        *           *          *          *           *          *          *

            5.   Appeals Officer Roseann Novetti sent taxpayer a letter
                 dated March 23, 2011, scheduling a telephone conference
                 for May 11, 2011 at 1 pm. The same letter indicated tax-
                 payer could have a face to face hearing if he notified Ms.
                 Novetti. (Exhibit E)
                                   - 14 -

[*14]   6.   On May 8, 2011, taxpayer sent Ms. Novetti a letter
             requesting a face-to-face hearing. Petitioner never heard
             from Ms. Novetti after the May 8th letter. (Exhibit F)

        7.   Congress has set forth three pre-conditions for Collection
             Due Process Hearing (herein referred to as CDPH):

             a.   Petitioner must make request.

             b.   Petitioner must make request in a timely manner, 30
                  days.

             c.   Petitioner must state the purpose of the hearing which
                  includes collection alternatives, procedure irregulari-
                  ties, spousal relief and tax liability in some cases.

        8.   Petitioner complied with all of these. Further, the IRS has
             an extra precondition for taxpayer not to raise political,
             Constitutional and religious concerns. Petitioner complied
             with this extra requirement.

        9.   The IRS has other irregular and interesting preconditions
             such as filling out forms and submitting a payment sched-
             ule. These requirements are impossible for Petitioner to
             meet on the Appeals Office time table.

        10. Petitioner stated in his CDPH Request that he would pro-
            vide all applicable forms. In Brandt v. Commissioner, T.C.
            2009-16, a Collection Hearing was granted even though
            Petitioner had not filed the applicable forms. Brandt was
            even granted an extension of 28 days beyond the date of the
            actual hearing to do so. Settlement Officer Novetti wanted
            all such paperwork prior to the scheduling of the CDPH.

        11. The IRS illegally and wrongfully did not allow an in-
            person hearing and violated Petitioner’s statutory and
                                    - 15 -

[*15]        administrative due process rights. Petitioner’s rights under
             the administrative procedure code include an opportunity to
             appear before the fact-finding tribunal. The U.S. Tax Court
             has held many times that the law requires an in-person
             hearing. Marett v. CIR, Docket # 4048-061, decided 7 Jul
             06; Shell v. CIR, Docket # 20188-05L, decided 31 May 06;
             Nelson v. CIR, Docket # 13212-05L, decided 7 Nov 05.

        12. The Settlement Officer prematurely issued her Notice of
            Determination without taking into consideration Petitioner’s
            reasoning for a face to face hearing. She failed to consider
            all available collection alternatives and the facts of the case.

        13. Petitioner requested a face-to-face hearing so that he could
            tape record the hearing as is allowed by law pursuant to
            §7521 and Keene v. Commissioner, 121 T.C. 8 (2003) and
            Calafati v. Commissioner, 127 T.C. 16.

        14. Petitioner requested a face-to-face hearing within the time
            period and raised relevant issues. Therefore taxpayer is
            entitled to an in-person hearing. Under IRC §§6320 and
            6330, Petitioner is entitled to an in-person CDP hearing at
            a location convenient to him.

        15. Petitioner was not given the opportunity to raise any rele-
            vant issue relating to the unpaid tax or the proposed levy at
            a hearing in accordance with IRC §§6320 and/or 6330(C).

        16. Petitioner was not able to discuss collection alternatives,
            which is a relevant issue for a face-to-face hearing,
            be cause no in-person hearing was held. In Mesa Oil Inc.
            v. United States, No. 00-B-851 (D. Colo. Filed Nov. 21,
            2000) the court decided that the CDP statute, I.R.C.
            §6330(c)(3), was ambiguous because it did not specify
                                       - 16 -

[*16]           what factors the appeals officer needed to consider in
                performing the balancing analysis. The court held that the
                appeals officer must verify that she thoroughly considered
                the facts of the case, including the availability of alternative
                collection methods. (Paraphrased from Collection,
                Bankruptcy and Summonses Bulletin No. 428,
                November 2000).

            17. At the in-person hearing, which should have been scheduled
                since Petitioner requested it and has relevant issues to dis-
                cuss; Petitioner would have been present in person and
                brought with him a tape recorder, witnesses to observe the
                process and possibly a representative.

            18. Petitioner understands that face-to-face hearings are not
                required but if a taxpayer asks for a face-to-face hearing,
                one must be granted on all non-frivolous issues. * * *

        *          *          *          *           *           *            *

            20. In the case of Schulz II, the U.S. Court of Appeals for the
                2nd Circuit issued a definitive ruling: Independent judicial
                review is required for all IRS collection enforcement activi-
                ties. Now, the IRS is like landlords, banks and loan compa-
                nies who need a court hearing before state action. The
                Debtor is entitled to an independent judge to scrutinize the
                enforcement activities of all collection agencies. Harsh
                actions are no longer allowed without the acquiescence or
                intervention from a judge. A judge is defined as holding a
                lifetime appointment with no diminishment in salary. Schulz
                v. IRS, 2nd Circuit, June 2005, 413 F.3d 297(2d)NY, 95
                A.F.T.R.2d 2005-3007, 2005 WL 152090.

        *          *          *          *           *           *            *

            22. Petitioner’s rights were violated in the following manner:
                                          - 17 -

[*17]              A. Petitioner was not granted an in-person hearing as he
                      had requested;

                   B.   Petitioner did not have the opportunity to raise collec-
                        tion alternatives such as OIC, payment schedules, non-
                        collectible status;

                   C.   Petitioner did not have the opportunity to examine the
                        administrative record to verify that all procedural re-
                        quirements had been met by the IRS and that all pay-
                        ments had been properly applied.

                   D. This caused financial hardship for Petitioner as well as
                      severe emotional and physical distress.

              23. Issuance of the Notice of Determination was inappropriate.
                  It did not balance the need for efficient collection with Tax-
                  payer’s concerns that the collection action be no more intru-
                  sive than necessary.

              24. The Notice of Determination should be overturned, and a
                  new proper CDP hearing should be scheduled. The Settle-
                  ment Officer was not a person authorized to hold a CDPH.

        Petitioner also alleged in the petition that he was seeking “judicial review of

the IRS tax assessment under the due process clause of the United States Constitu-

tion”. In this connection, petitioner alleged in the petition in pertinent part:

“No government agency can take any action against any Citizen absent judicial

intervention. Government agents are not allowed into people’s homes or people’s

pocketbooks without review by the independent judiciary.”

        Petitioner concluded the petition by alleging:
                                          - 18 -

[*18]         30. This Petition explains Petitioner’s position and Petitioner
                  requests that the Court remand this case to Appeals Office
                  and order the IRS to schedule a face-to-face hearing.

              31. In conclusion, Petitioner requests independent judicial re-
                  view of IRS’s enforcement actions. The courts have a long
                  string of cases requiring a judicial intervention under the due
                  process clause before state action against a Citizen. There-
                  fore, this court should schedule a hearing to review or scruti-
                  nize the intended IRS police state activities.

        WHEREFORE, Petitioner requests that the Notice of Determination
        be overturned and that a new, proper CDPH be scheduled.

        Many of the allegations that petitioner made in the petition are very similar

to allegations that we have seen advanced repeatedly by so-called tax protesters.

        On October 26, 2012, we issued an Order in which we ordered petitioner to

file a response to respondent’s motion. In that Order, we also indicated that our

review of the record suggested that petitioner might intend to advance in this case

frivolous and/or groundless statements, contentions, arguments and/or questions.

We reminded petitioner in the Order dated October 26, 2012, about section

6673(a)(1)6 and admonished him that if he advanced frivolous and/or groundless

statements, contentions, arguments, and/or questions and/or instituted or main-

        6
       All section references are to the Internal Revenue Code in effect at all
relevant times. All Rule references are to the Tax Court Rules of Practice and
Procedure.
                                         - 19 -

[*19] tained this proceeding primarily for delay, we would impose on him a penalty

under section 6673(a)(1) in an amount not exceeding $25,000.

      On December 4, 2012, petitioner filed a response to respondent’s motion

(petitioner’s response).

                                       Discussion

      The Court may grant summary judgment where there is no genuine dispute of

material fact and a decision may be rendered as a matter of law. Rule 121(b);

Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), aff’d, 17 F.3d 965 (7th

Cir. 1994). We conclude that there is no genuine dispute as to any material

fact regarding the questions raised in respondent’s motion.

      Petitioner did not file a petition with the Court with respect to the 2007 notice

of deficiency that he received. Where, as is the case here, the validity of the underly-

ing tax liability is not properly placed at issue, the Court will review the determina-

tion of the Commissioner of Internal Revenue for abuse of discretion. Sego v.

Commissioner, 114 T.C. 604, 610 (2000); Goza v. Commissioner, 114 T.C. 176,

182 (2000).

      It is petitioner’s position that respondent abused respondent’s discretion in

issuing the notice of determination with respect to his taxable year 2007. In support

of that position, petitioner relies in petitioner’s response to respondent’s [*19] moti-
                                         - 20 -

on on respondent’s refusal to grant him a face-to-face hearing with respect to the

proposed collection action relating to that taxable year.7

      In the settlement officer’s March 23, 2011 letter to petitioner, she stated in

pertinent part:

      Your attached letter requests a face to face hearing. In order to
      have a face to face you must be in full compliance. Our records
      indicate that you are currently missing you [sic] 2004 and 2009 tax
      returns. Enclosed you will find the 1040’s with the reported income
      for these years. * * * complete and sign these forms [1040] and fax
      them to me at the fax number listed above and also send me the
      completed [Form] 433A also enclosed by April 5, 2011, I will be able
      to transfer your case at that time for a face to face hearing. If I do
      not receive this information by April 5, 2011 you will still be eligi-
      ble for the telephone conference.

           *        *           *          *           *           *          *

      For me to consider alternative collection methods such as an installment
      agreement or offer in compromise, you must provide any items
      listed below. In addition, you must have filed all federal tax re-
      turns required to be filed.

           • A completed Collection Information Statement (Form 433-A
             for individuals and/or Form 433-B for businesses.)

       7
        Petitioner relies in the petition on several additional allegations in support of
his position that respondent abused respondent’s discretion in issuing the notice of
determination, including certain frivolous and/or groundless allegations. For
example, petitioner alleged in the petition that his “rights were violated” because,
inter alia, he “did not have the opportunity to examine the administrative record to
verify that all procedural requirements had been met by the IRS and that all pay-
ments had been properly applied.” We have rejected that type of allegation on
numerous occasions. See, e.g., Craig v. Commissioner, 119 T.C. 252, 262 (2002).
                                          - 21 -

[*21]      • Signed tax return(s) for the following tax periods. Our records
             indicate they have not been filed:
             Type of Tax: 1040
             Period or Periods: 2004 and 2009

           • Proof of estimated tax payments for the period(s) listed
             below:
             2001 or a corrected W4

           • Other All income and expense substantiation and three
             months of bank statements

           • Form 656 Offer in Compromise

        Please send me the items requested above within 14 days from the
        date of this letter, no later than May 5, 2011. I cannot consider
        collection alternatives at your conference without this information. I
        am enclosing the applicable forms and a return envelope for your
        convenience.

          *           *          *          *           *          *           *

        If you do not participate in the conference or respond to this letter, the
        determination and/or decision letter that we issue will be based on your
        CDP request, any information you previously provided to this office
        about the applicable tax periods, and the Service’s administrative file
        and records.

        In response to the settlement officer’s March 23, 2011 letter, petitioner sent

the settlement officer his May 8, 2011 letter. In that letter, petitioner indicated that

he would provide the settlement officer with the information and the documents that

the settlement officer had requested from him in her March 23, 2011 letter only at a

face-to-face hearing.
                                         - 22 -

[*22] After having received the May 8, 2011 letter from petitioner, the settlement

officer called him to inform him that a face-to-face hearing could not be held until he

provided the settlement officer with the information and the documents that the

settlement officer had requested in her March 23, 2011 letter. Petitioner did not

respond to that telephone call.

      We conclude that the settlement officer’s refusal to schedule a face-to-face

hearing with petitioner unless he provided the information and the documents that the

settlement officer had requested in her March 23, 2011 letter was not an abuse of

discretion. Indeed, the settlement officer’s actions were consistent with section

301.6330-1(d)(2), Q&A-D8, Proced. & Admin. Regs.8

      On May 11, 2011, the date of the scheduled telephonic conference, the

settlement officer called petitioner, but he was not available. On the same date, after

petitioner failed to participate in the scheduled telephonic conference, the

       8
       Sec. 301.6330-1(d)(2), Q&A-D8, Proced. & Admin. Regs., provides in
pertinent part:

       A face-to-face CDP conference concerning a collection alternative
       * * * will not be granted unless other taxpayers would be eligible for
       the alternative in similar circumstances. For example, because the IRS
       does not consider offers to compromise from taxpayers who have not
       filed required returns * * * no face-to-face conference will be granted
       to a taxpayer who wishes to make an offer to compromise but has not
       fulfilled those obligations. * * *
                                          - 23 -

[*23] settlement officer sent him the May 11, 2011 letter. In that letter, the

settlement officer stated in pertinent part:

       I sent you a letter dated March 23, 2011 offering you a telephonic
       Collection Due Process conference. The conference was scheduled for
       May 11, 2011 at 1:00pm EST.

       I tried calling you at the scheduled time but you were not available and
       you had not called to indicate that this date and/or time was not
       convenient.

       The conference letter also asked that you send me the information I
       needed to consider the issues you raised in your request for a hearing.

          • I never received the information from you.

       Please be advised that we will make a determination in the Collection
       Due Process hearing you requested by reviewing the Collection
       administrative file and whatever information you have already provided.

       If you would like to provide information for our consideration, please
       do so within 14 days from the date on this letter, no later than May 25,
       2011.

       We will promptly issue you a determination and/or decision letter with
       our findings.

       On August 10, 2011, the Appeals Office issued to petitioner the notice of

determination with respect to his taxable year 2007. In that notice, that office

sustained the proposed collection action with respect to that taxable year.
                                          - 24 -

[*24] Based upon our examination of the entire record before us, we find that

respondent did not abuse respondent’s discretion in making the determinations in the

notice of determination with respect to petitioner’s taxable year 2007.

      We consider sua sponte whether to impose on petitioner a penalty under

section 6673(a)(1), a provision that we brought to his attention in our Order dated

October 26, 2012. Section 6673(a)(1) authorizes us to require a taxpayer to pay to

the United States a penalty in an amount not to exceed $25,000 whenever it appears

to us, inter alia, that the taxpayer instituted or maintained a proceeding before us

primarily for delay, sec. 6673(a)(1)(A), or that the taxpayer’s position in a proceeding

before us is frivolous or groundless, sec. 6673(a)(1)(B).

      We believe that petitioner instituted and maintained this case primarily for

delay and that the arguments in support of his position that he was entitled to a face-

to-face hearing with the Appeals Office are frivolous and/or groundless. Nonetheless,

we shall not impose a penalty under section 6673(a)(1) on petitioner at this time. We

caution him that he may be subject to such a penalty if in the future he institutes or

maintains a proceeding before us primarily for delay and/or his position in any such

proceeding is frivolous or groundless. See Abrams v. Commissioner, 82 T.C. 403,

409-413 (1984); White v. Commissioner, 72 T.C. 1126, 1135-1136 (1979).
                                           - 25 -

[*25] We have considered any of petitioner’s contentions and arguments that are not

discussed herein and that are not frivolous and/or groundless, and we find them to be

without merit, irrelevant, and/or moot.

      On the record before us, we shall grant respondent’s motion.

      To reflect the foregoing,

                                                An order granting respondent’s

                                          motion and decision for respondent will be

                                          entered.