Nestor v. Comm'r

Foley, J., dissenting: In the Internal Revenue Service Restructuring and Reform Act of 1998 (rra 1998), Pub. L. 105-206, sec. 3401 , 112 Stat. 746 , Congress enacted sections 6320 and 6330 to provide safeguards for persons subject to collection actions. Sections 6320 and 6330 generally provide that respondent cannot proceed with collection until the taxpayer has been given notice and the opportunity for an Appeals Office hearing. See sec. 6330(a)(1), (b)(1), (e)(1). “In the case of any hearing conducted under * * * [section 6330] the appeals officer shall at the hearing obtain verification from the Secretary that the requirements of any applicable law or administrative procedure have been met.” Sec. 6330(c)(1).

Petitioner contends that respondent’s verification was incorrect because respondent did not, at the section 6330 hearing, provide him with proof of assessments. I agree. Despite respondent’s purported verification that all statutory or administrative procedures were met, respondent did not satisfy the section 6203 requirement that the Secretary provide a copy of the record of assessment (e.g., Form 4340, Certificate of Assessments, Payments, and Other Specified Matters (Form 4340)) to the taxpayer upon his request. Accordingly, respondent’s verification was erroneous.

Section 6203 provides that “The assessment shall be made by recording the liability of the taxpayer in the office of the Secretary in accordance with rules or regulations prescribed by the Secretary. Upon request of the taxpayer, the Secretary shall furnish the taxpayer a copy of the record of the assessment.” The majority choose not to decide “whether * * * the second sentence of section 6203 is an ‘applicable law or administrative procedure’ referred to in section 6330 (c)(1)”. Majority op. p. 167. Section 6203, in its entirety, is such a law. Assessment is an integral part of the collection process, and the method by which respondent makes an assessment is prescribed in section 6203. In addition, regulations promulgated by respondent provide that “If the taxpayer requests a copy of the record of assessment, he shall be furnished a copy of the pertinent parts of the assessment which set forth the name of the taxpayer, the date of assessment, the character of the liability assessed, the taxable period, if applicable, and the amounts assessed.” Sec. 301.6203-1, Proced. & Admin. Regs. Furnishing Form 4340 to the taxpayer satisfies the requirements of section 6203. See, e.g., Huff v. United States, 10 F.3d 1440, 1445 (9th Cir. 1993). Respondent, however, failed to adhere to section 6203 and section 301.6203-1, Proced. & Admin. Regs. Thus, the Appeals officer incorrectly determined that the requirements of applicable laws were met. See sec. 6330(c)(1).

Prior to the section 6330 hearing, respondent did not provide petitioner with Forms 4340. Moreover, at the hearing, respondent did not allow petitioner to discuss the assessments. Thus, respondent deprived petitioner of his right to raise relevant issues relating to the assessments. See sec. 6330(c)(2). The appropriate remedy is to have a further hearing on this matter. The majority may wonder what “bona fide interest would be served”. In short, the “bona fide interest” served is compliance with the provisions of section 6330.

Chiechi, J., agrees with this dissenting opinion.