T.C. Memo. 2018-206
UNITED STATES TAX COURT
LEON STEINHARDT, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 20658-17L. Filed December 18, 2018.
Leon Steinhardt, pro se.
Wendy C. Yan, for respondent.
MEMORANDUM OPINION
GERBER, Judge: This collection review case, filed pursuant to section
6330(d)(1), was calendared for trial at the Richmond, Virginia, session of the
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[*2] Court scheduled to commence on October 15, 2018.1 On August 15, 2018,
the Court filed respondent’s motion for summary judgment and the supporting
declaration of Settlement Officer Stephan R. Harding (SO Harding). On
September 10, 2018, the Court filed petitioner’s notice of objection to motion for
summary judgment and motion to remand.
Background
Respondent determined Federal income tax deficiencies against petitioner
for 1998, 1999, 2000, and 2001 based on substitutes for returns respondent
prepared pursuant to section 6020(b), and on January 31, 2011, the Court entered a
decision in docket No. 10113-05 for those years. Petitioner also failed to file
Federal income tax returns for 2008 and 2009. On May 16, 2011, respondent sent
petitioner a letter requesting that petitioner file Federal income tax returns for
2008 and 2009 or agree to the proposed deficiencies pursuant to the substitutes-
for-returns procedures. Respondent prepared substitutes for returns for 2008 and
2009 pursuant to section 6020(b). On July 18, 2011, respondent sent notices of
deficiency to petitioner’s Virginia Beach, Virginia, address for 2008 and 2009.
Those notices were sent via certified mail to the same address petitioner used on
1
All section references are to the Internal Revenue Code, as amended, and
all Rule references are to the Tax Court Rules of Practice and Procedure.
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[*3] his petition to this Court. Petitioner did not challenge the proposed
deficiencies for 2008 and 2009, and respondent assessed the deficiencies based on
the substitutes for returns.
On April 19, 2017, respondent issued petitioner a Notice of Intent to Levy
and Your Right to a Hearing relating to 1998, 1999, 2000, 2001, 2008, and 2009
(years in issue). On May 17, 2017, petitioner timely submitted his Form 12153,
Request for a Collection Due Process or Equivalent Hearing, requesting a
collection due process hearing for the years in issue. On the Form 12153,
petitioner stated that “[he was] disputing these alleged taxes or penalties
associated with these taxes, and strongly believe[s] that [he] do[es] not owe them”
and requested a face-to-face hearing closer to his home. Petitioner also requested
consideration of collection alternatives “[i]f at the end of … [his] hearing, it is
proven that [he] owe[s] the tax”, although he did not check any of the respective
boxes relating to collection alternatives.
On July 17, 2017,2 SO Harding from respondent’s Appeals Office in
Atlanta, Georgia, sent petitioner a letter acknowledging that respondent received
2
The notice of determination references respondent’s letter dated July 7,
2017. The record includes, and both respondent’s counsel and petitioner
reference, a letter dated July 17, 2017. The July 7, 2017, reference appears to be a
typographical error on respondent’s part.
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[*4] petitioner’s Form 12153 relating to the years in issue and scheduling a
telephone conference for August 15, 2017. SO Harding informed petitioner that
he was not permitted to dispute the liabilities for 1998, 1999, 2000, and 2001
because petitioner had previously disputed these liabilities in a collection due
process hearing. Since SO Harding was unable to verify petitioner’s receipt of the
notices of deficiency for 2008 and 2009, he informed petitioner that he could
challenge the underlying liabilities relating to 2008 and 2009 but needed to
provide his 2008 and 2009 amended Federal income tax returns. SO Harding also
informed petitioner that he could qualify for a face-to-face collection due process
hearing if he was in current compliance with his filing requirements.
In order for SO Harding to consider collection alternatives, he requested
that petitioner provide the following information: a completed Form 433-A,
Collection Information Statement for Wage Earners and Self-Employed
Individuals; a completed Form 433-B, Collection Information Statement for
Businesses; and signed tax returns for 2010, 2011, 2012, 2013, 2014, 2015, and
2016 or proof of his compliance with filing requirements. SO Harding requested
additional information including a Form 656, Offer in Compromise, and financial
information.
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[*5] On August 14, 2017, petitioner called SO Harding and informed him that he
would not be calling in for the collection due process telephone hearing.
Petitioner also sent SO Harding a letter dated August 14, 2017, which stated: “I
will not be able to participate in the telephone conference you scheduled for
August 15, 2017.” Petitioner also alleged that he was entitled to a face-to-face
collection due process hearing; the assignment of his hearing to the Atlanta,
Georgia, Appeals Office was in error because he resided in Virginia Beach,
Virginia; and he was able to dispute the liabilities relating to 1998, 1999, 2000,
and 2001 because “[he] believe[d] that the amounts of interest and penalties [were]
incorrect [and] the IRS makes a lot of mistakes”. Additionally, petitioner
contended that he had not received a notice of deficiency for 2008 or 2009. SO
Harding’s July 17, 2017, letter gave petitioner 14 days to provide the requested
information and 21 days to provide the Federal tax returns. Petitioner did not
provide the requested information before the scheduled collection due process
hearing, nor did he request additional time to collect the information. SO Harding
did not contact petitioner after reviewing petitioner’s letter, which did not include
the requested information.
Before the issuance of the notice of determination, SO Harding reviewed the
information available to him, including the information returns provided by third-
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[*6] party payors. He determined that petitioner would have a filing requirement
for each of his 2010 through 2016 taxable years. Additionally, he determined
respondent had grounds for making the 2008 and 2009 assessments and that the
notices of deficiency were mailed to petitioner’s last known address via certified
mail, although delivery could not be established.3 SO Harding determined that
although “[petitioner] can and does dispute these 2008 and 2009 tax assessments,
no documentation has been provided to indicate the amount of the dispute or
evidence to support a reduction of these assessments.” SO Harding also
determined that “all penalty and interest assessments [for the years at issue] appear
correct” after he had considered all of information available to him.
On September 1, 2017, respondent issued to petitioner a notice of
determination sustaining the notice of intent to levy relating to the years in issue.
On October 2, 2017, petitioner, while residing in the State of Virginia, filed his
petition with the Court disputing the notice of determination.
On his petition, petitioner stated that “[t]he IRS never gave [him] a Face-to-
Face hearing, ignoring [his] request for a [collection due process hearing]”.
Respondent contends that petitioner did not qualify for a face-to-face hearing.
3
The Case Activity Record states that “the post office does not hol[d] [sic]
the proof of delivery on line back to 2011, when these notices were issued and
proof of delivery or intentional refusal of delivery cannot be established.”
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[*7] Petitioner did not explicitly challenge in his petition the underlying liability
for 1998, 1999, 2000, or 2001 or his receipt of the notices of deficiency for 2008
and 2009. Respondent contends in his motion for summary judgment that
petitioner conceded the underlying tax liabilities for the years in issue.
Petitioner challenged respondent’s contention regarding the concession of
the underlying liabilities. In his notice of objection petitioner stated that he had
raised numerous issues in his August 14, 2017, letter, including that he objected to
a settlement officer from Atlanta holding the hearing, he did not receive notices of
deficiency for 2008 and 2009, and he wished to dispute the penalties and interest
for 1998, 1999, 2000, and 2001.
In his motion to remand, petitioner again contended that the case should be
remanded to the IRS Appeals Office for a face-to-face hearing.
Discussion
Either party may move for summary judgment on all or any part of the legal
issues in controversy. Rule 121(a). The Court may grant summary judgment only
if “there is no genuine dispute as to any material fact and … a decision may be
rendered as a matter of law.” Rule 121(b); see Naftel v. Commissioner, 85 T.C.
527, 528-529 (1985). As the moving party, respondent bears the burden of
proving that no genuine dispute exists as to any material fact and that respondent
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[*8] is entitled to judgment as a matter of law. See Sundstrand Corp. v.
Commissioner, 98 T.C. 518, 520 (1992), aff’d,
17 F.3d 965 (7th Cir. 1994). The
party opposing summary judgment must set forth specific facts which show that a
genuine question of material fact exists and may not rely merely on allegations or
denials in the pleadings. Rule 121(d); see Sundstrand Corp. v. Commissioner,
98
T.C. at 520.
In deciding whether to grant summary judgment, the factual materials and
the inferences drawn from them must be considered in the light most favorable to
the nonmoving party (i.e., petitioner in this case). FPL Grp., Inc. v.
Commissioner, 115 T.C. 554, 559 (2000); Naftel v. Commissioner,
85 T.C. at 529.
Where the record viewed as a whole could not lead a reasonable trier of fact to
find for the nonmoving party, there is no “genuine issue for trial”. Matsushita
Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 587 (1986).
This Court has jurisdiction under section 6330 to review the
Commissioner’s administrative determinations. See sec. 6330(d); see also Iannone
v. Commissioner, 122 T.C. 287, 290 (2004). Generally, the Court may consider
only those issues that the taxpayer properly raised during the hearing. See sec.
301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see also Giamelli v.
Commissioner,
129 T.C. 107, 112-114 (2007); Magana v. Commissioner, 118 T.C.
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[*9] 488, 493 (2002). At a collection due process hearing the taxpayer may raise
“any relevant issue relating to the unpaid tax or the proposed levy”. Sec.
6330(c)(2)(A). The taxpayer may also raise challenges to the existence or amount
of the underlying tax liability if the taxpayer did not receive a statutory notice of
deficiency with respect to the underlying liability or did not otherwise have an
opportunity to dispute that liability. Sec. 6330(c)(2)(B).
Rule 331(b)(4), however, requires petitioner to include in his petition “clear
and concise assignments of each and every error which … petitioner alleges to
have been committed in the notice of determination. Any issue not raised in the
assignments of error shall be deemed conceded.” See McLaine v. Commissioner,
138 T.C. 228, 244 (2012); Westby v. Commissioner,
T.C. Memo. 2007-194. The
petition contained only arguments relating to respondent’s failure to provide him a
face-to-face collection due process hearing. Petitioner, however, contended in his
notice of objection that he indirectly challenged the underlying liabilities relating
to the years in issue and the receipt of the notices of deficiency relating to 2008
and 2009 in his petition and explicitly challenged these issues in a letter to SO
Harding.
Irrespective of whether he conceded his underlying liabilities, petitioner
cannot challenge his underlying tax liabilities for 1998, 1999, 2000, and 2001.
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[*10] Petitioner previously disputed the underlying liabilities for those years, and
on January 31, 2011, the Court entered a decision against him in docket No.
10113-05 for those years. When the underlying tax liability is not at issue, the
Court reviews the determinations regarding the collection action for abuse of
discretion. Goza v. Commissioner, 114 T.C. 176, 182 (2000).
Petitioner challenged the underlying liabilities for 2008 and 2009, and SO
Harding determined that petitioner could do so. Petitioner, however, did not
participate in the collection due process hearing or provide to the settlement
officer his amended 2008 and 2009 Federal income tax returns. Petitioner did not
properly dispute the underlying tax liabilities for the years at issue, and
accordingly, the Court will not consider any adjustments to the amounts. See
Goza v. Commissioner, 114 T.C. at 182; sec. 301.6330-1(f)(2), Q&A-F3, Proced.
& Admin. Regs.
The Court reviews the determinations regarding the collection action for the
years in issue for abuse of discretion. Pursuant to this standard, the taxpayer must
prove that the determination was arbitrary, capricious, or without sound basis in
fact or law. See Sego v. Commissioner, 114 T.C. 604, 610 (2000); Woodral v.
Commissioner,
112 T.C. 19, 23 (1999).
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[*11] Collection due process hearings are informal, may consist of one or more
oral or written communications between an Appeals officer and the taxpayer, and
do not require the Appeals officer and the taxpayer to have a face-to-face
conference. See sec. 301.6330-1(d)(2), Q&A-D6, Proced. & Admin. Regs. While
petitioner contends that he was denied a face-to-face collection due process
hearing, this Court has consistently held that a face-to-face hearing is not required
pursuant to section 6320 or 6330, and a proper collection due process hearing may
be held by telephone or by correspondence under certain circumstances. See Katz
v. Commissioner, 115 T.C. 329, 337-338 (2000); Rice v. Commissioner,
T.C.
Memo. 2009-169; Huntress v. Commissioner,
T.C. Memo. 2009-161; Moline v.
Commissioner,
T.C. Memo. 2009-110, aff’d,
363 F. App’x 675 (10th Cir. 2010).
A taxpayer may request a face-to-face collection due process hearing at the
Appeals Office closest to the taxpayer’s residence. See sec. 301.6330-1(d)(2),
Q&A-D7, Proced. & Admin. Regs. However, “a face-to-face CDP conference
concerning a collection alternative, such as an installment agreement or an offer to
compromise liability, will not be granted unless … [another] taxpayer[] would
be eligible for the alternative in similar circumstances.” See id. Q&A-D8. For
example, if a taxpayer is not in compliance with his filing obligations or has not
made certain required deposits of tax as set forth in Form 656, no face-to-face
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[*12] conference will be granted to the taxpayer if he wishes to make an offer-in-
compromise but has not fulfilled these obligations. Id. SO Harding informed
petitioner that he needed to be in compliance with his Federal income tax filing
obligations in order to qualify for a face to face hearing concerning collection
alternatives. From review of the information available to him, SO Harding
determined that petitioner had Federal tax filing obligations for 2010 through
2016. Petitioner, however, did not provide any of the information requested,
including whether he was in compliance with his 2010 through 2016 Federal
income tax filing obligations, and did not participate in the telephone collection
due process hearing. Accordingly, the Court concludes that there was no abuse of
discretion in respondent’s determinations, and respondent’s motion for summary
judgment will be granted.
To reflect the foregoing,
An appropriate order and
decision will be entered.
