UNITED STATES TAX COURT

Agency decision

Ask Donna

What actually matters in this document.

Text

T.C. Memo. 2001-285

UNITED STATES TAX COURT

TERRY L. LINDSAY, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 3486-01L.

Filed October 15, 2001.

Terry L. Lindsay, pro se.

Julie A. Fields, for respondent.

MEMORANDUM OPINION

RUWE, Judge:

This case is based on a petition filed under

section 6320(c), which incorporates the provisions for judicial

review contained in section 6330(d)(1).

Respondent has filed a

motion for summary judgment pursuant to Rule 121,1 alleging that

Unless otherwise indicated, all section references are to

(continued...)

- 2 no genuine issue of material fact remains for trial.

At the time

petitioner filed his petition to this Court, he resided in

Salinas, California.

On August 14, 2000, respondent filed a Notice of Federal Tax

Lien, Form 668(Y)(c), with the County Recorder of Monterey

County, Salinas, California.

The lien was filed with respect to

unpaid income taxes of $10,239.52 for taxable years 1990, 1991,

1992, 1993, and 1994.2

On August 18, 2000, respondent issued a

Notice of Federal Tax Lien Filing and Your Right to a Hearing

Under IRC 6320, Letter 3172 (ALS), to petitioner.

The notice

informed petitioner of his right to a hearing before the IRS

Appeals Office.

On September 21, 2000, petitioner filed a timely

Form 12153, Request for a Collection Due Process Hearing.

Attached to petitioner’s Form 12153 was a 12-page document in

which petitioner raised challenges to the lien filing.

(...continued)

the Internal Revenue Code currently in effect, and all Rule

references are to the Tax Court Rules of Practice and Procedure.

Petitioner did not file tax returns for taxable years 1990

through 1994. Petitioner has addressed several letters to

members of the Federal Government arguing that the 16th Amendment

was fraudulently certified as ratified by the States, and the IRS

is without the constitutional power to assess and collect taxes.

These arguments, as articulated by petitioner, have been

correctly described as tax protester gibberish. See Crain v.

Commissioner, 737 F.2d 1417, 1418 (5th Cir. 1984); Williams v.

Commissioner, 114 T.C. 136, 144 (2000); Nagy v. Commissioner,

T.C. Memo. 1996-24; Black v. Commissioner, T.C. Memo. 1995-560;

Olsen v. Commissioner, T.C. Memo. 1995-471; Pabon v.

Commissioner, T.C. Memo. 1994-476.

- 3 On January 30, 2001, a hearing was held before an IRS

Appeals officer.

On February 14, 2001, a notice of determination

was sent to petitioner by the Appeals Office.

determination stated:

The notice of

(1) A certified transcript was reviewed

which shows that the assessments exist; (2) petitioner cannot

dispute the underlying tax liability since a notice of deficiency

was received; (3) all legal and administrative requirements for

the proposed action have been met; and (4) balancing of the

efficient collection of taxes with petitioner’s privacy interests

weighed in favor of the lien filing.

On March 14, 2001,

petitioner filed a timely petition to the Tax Court.

Section 6321 imposes a lien on all property and property

rights of a taxpayer where a demand for the payment of taxes has

been made and the taxpayer fails to pay those taxes.

imposed when an assessment of taxes is made.

A lien is

Sec. 6322.

Section

6323(a) requires the Secretary to file notice of a lien if it is

to be valid against any purchaser, holder of a security interest,

mechanic’s lienor, or judgment lien creditor.

Section 6320 was added to the Code in 1998, along with its

sister provision, section 6330.

See Internal Revenue Service

Restructuring and Reform Act of 1998, Pub. L. 105-206, sec. 3401,

112 Stat. 746.

Section 6320(a) requires the Secretary to send a

written notice to the taxpayer of the filing of a notice of lien

- 4 and of his right to a hearing.3

Section 6320(b) affords the

taxpayer the right to a fair hearing before an impartial Appeals

officer.

Section 6320(c) incorporates the provisions under

section 6330(c), (d), and (e).

Section 6330(c)(1) requires the

Appeals officer to verify that the requirements of any applicable

law or administrative procedure have been met.

Section

6330(c)(2)(A) specifies issues that the taxpayer may raise at the

Appeals hearing.

The taxpayer is allowed to raise any relevant

issue relating to the unpaid tax including spousal defenses,

challenges to the appropriateness of collection action, and

alternatives to collection.

Sec. 6330(c)(2)(A).

The taxpayer

cannot raise issues relating to the underlying tax liability if

the taxpayer received a notice of deficiency or the taxpayer

otherwise had an opportunity to dispute the tax liability.

6330(c)(2)(B).

Sec.

Section 6330(d)(1) allows the taxpayer to appeal

a determination to the Tax Court or a district court.

Respondent argues that there are no genuine issues of

material fact in this case, and, therefore, we should grant his

motion for summary judgment.

Respondent claims that petitioner

received a notice of deficiency, and, therefore, the underlying

Generally, a Notice of Federal Tax Lien, Form 668(Y)(c), is

filed with an appropriate local Government entity and gives

public notice of the Federal Government’s lien on the taxpayer’s

property. A Notice of Federal Tax Lien Filing and Your Right to

a Hearing Under IRC 6320, Letter 3172 (ALS), is then sent to the

taxpayer.

- 5 tax liability cannot be raised in the hearing or in the Tax Court

proceeding.

Respondent argues that petitioner effectively

conceded the Appeals officer’s determination that petitioner

received a notice of deficiency by failing to raise the issue in

the petition.

Respondent also argues that petitioner has

conceded the issues that may be raised under section

6330(c)(2)(A), since he did not raise those issues in the

petition or at the hearing.

Further, respondent contends that

the validity of the assessments has already been verified by a

Form 4340, Certificate of Assessments and Payments, which could

be relied on by an Appeals officer to satisfy his verification

function under section 6330(c)(1).

We shall grant a motion for summary judgment where the

pleadings and other materials show that there is no genuine issue

as to any material fact and that a decision may be rendered as a

matter of law.

Sundstrand Corp. v. Commissioner, 98 T.C. 518,

520 (1992), affd. 17 F.3d 965 (7th Cir. 1994).

The burden is on

the moving party, respondent, to prove the nonexistence of a

genuine issue as to any material fact and that he is entitled to

judgment as a matter of law.

FPL Group, Inc. & Subs. v.

Commissioner, 116 T.C. 73, 74-75 (2001); Naftel v. Commissioner,

85 T.C. 527, 529 (1985).

In all cases, we must view the facts

and inferences therefrom in the light most favorable to the

nonmoving party, petitioner.

Bond v. Commissioner, 100 T.C. 32,

- 6 36 (1993); Dahlstrom v. Commissioner, 85 T.C. 812, 821 (1985).

When a motion for summary judgment is made, the nonmoving party

cannot rely upon the allegations or denials in its pleading but

must demonstrate with specific facts that there is a genuine

issue for trial.

King v. Commissioner, 87 T.C. 1213, 1217

(1986); Shepherd v. Commissioner, T.C. Memo. 1997-555.

In his petition to this Court, petitioner raises no

discernable issues, except to argue generally that he disagreed

with the determination of the Appeals officer and that the

determination was not complete and was erroneous.

The petition

states:

1. Petitioner disagrees with the determination under

§§6230 and/or 6330 alleged for the year: 1990, 1991,

1992, 1993, and 1994 as set forth in the NOTICE OF

DETERMINATION CONCERNING COLLECTION ACTION(S) which is

dated FEB. 14, 2001, * * * and NOTICE OF FEDERAL TAX

LIEN * * *

Petitioner taxpayer identification number is: * * *

Petitioner disputes the following:

AMOUNT OF

DEFICIENCY

Years

1990

1991

1992

1993

1994

(disputed)

$1403.16

$3241.50

$427.57

$1787.47

$3379.82

ADDITIONS TO TAX/

PENALTIES-I.R.C.

[interest disputed &

penalties disputed]

$Unknown

4. Set forth those adjustments, i.e. changes, in the

FINAL NOTICE OF INTENT TO LEVY with which you disagree

and why you disagree: Respondent erred in its

administrative procedure against petitioner in issuing

- 7 the notice of levy pursuant to §6331.[4]

Request is made that this matter be transferred to the

appeals branch of the IRS on the grounds that the

information supporting the notice of levy is not

complete and is erroneous. SEE EXHIBIT “A” FOR

ADDITIONAL INFORMATION * * *

EXHIBIT “A”

DEMAND IS MADE THAT THE TAX COURT TRANSFER THIS CASE TO

THE APPELLATE DIVISION OF THE IRS ON THE GROUNDS THAT

THIS TAXPAYER HAS BEEN DENIED DUE PROCESS OF LAW, AND

HAS A SUBSTANTIAL CLAIM UNDER THE “NEW” TAXPAYER BILL

OF RIGHTS, AGAINST THE AGENT AND THE IRS, PLUS OTHER

CAUSES OF ACTION THAT HAVE NOT BEEN FULLY DETERMINED AS

OF THE PRESENT DATE

AVOIDANCE AND/OR AFFIRMATIVE DEFENSES

PETITIONER ALLEGES AS AN AVOIDANCE AND/OR AFFIRMATIVE

DEFENSE EACH OF THE FOLLOWING THAT HAVE BEEN MARKED BY

AN “X” ON THE LINE BEFORE THE ITEM LISTED:

RES JUDICATA

ESTOPPEL

WAIVER

DURESS

FRAUD

STATUTE OF LIMITATIONS

INVALID NOTICE OF INTENT TO LEVY NOT

COMPLYING WITH THE TAX CODE PROVISIONS

FAILURE TO PROVIDE FREEDOM OF INFORMATION ACT

DOCUMENTS AND MATERIALS NECESSARY FOR

PETITIONERS TO PREPARE FOR TRIAL

FAILURE OF RESPONDENT TO “FULLY COOPERATE” AS

PROVIDED BY THE STANDING ORDER

FAILURE OF RESPONDENT TO EXHAUST

ADMINISTRATIVE REMEDIES, NO PRIOR CONTACT

LACHES

We point out that there is no indication in the record that

respondent issued a Notice of Intent to Levy under sec. 6331(d),

gave a Notice of Levy to any third parties, or otherwise

initiated a levy action. On the contrary, the only notices in

the record are the Notice of Federal Tax Lien filed with Monterey

County and the Notice of Federal Tax Lien Filing sent to

petitioner. We assume, therefore, that petitioner is referring

to those notices in his petition.

- 8 X

THE “CLEAN HANDS” DOCTRINE (UNCLEAN HANDS OF

RESPONDENT)

ILLEGALITY

FAILURE OF JURISDICTION OVER PETITIONER

DISCHARGE IN BANKRUPTCY

OTHER________________________________________

A petition filed under section 6330(d)(1)(A) must contain

“Clear and concise assignments of each and every error”.

331(b)(4).

Rule

Further, “clear and concise lettered statements of

the facts on which the petitioner bases each assignment of error”

must be contained in the petition.

Rule 331(b)(5).

If any issue

is not raised in the petition, it “shall be deemed to be

conceded.”

Rule 331(b)(4).

be set forth in the petition.

Further, the prayer for relief shall

Rule 331(b)(6).

Petitioner was

not represented by counsel at the time he filed his petition.

Petitioner, nevertheless, has an obligation to comply with the

Rules of this Court.

The broad and general issues that

petitioner raised do not even come close to complying with those

Rules.5

In any event, the issues that petitioner presented

throughout the proceedings in this case do not raise a genuine

issue of material fact.

At the Appeals hearing, petitioner attempted to challenge

the underlying tax liability.

Specifically, petitioner argued

In his petition, petitioner presents a laundry list of

defenses to his tax liability and to the proposed collection

activity. Petitioner alleged no facts in support of those

defenses in his petition, in the Appeals hearing, or in documents

submitted to IRS Appeals or this Court. Our review of the record

shows that the defenses pleaded by petitioner have no merit.

- 9 that the Notice of Federal Tax Lien listed the “Kind of Tax” to

be collected as a “1040".

Petitioner contended that there was no

1040 tax under the Code, and, therefore, any such tax cannot be

legally collected and any payment would be voluntary.

Further,

in the attachment to the Form 12153, petitioner argued that the

presumption normally afforded a Form 4340, Certificate of

Assessments and Payments, should not apply where the notice sent

to him shows the kind of tax assessed as a 1040.

While it is true that a 1040 is not a tax under the Code,

Form 1040, U.S. Individual Income Tax Return, is recognized by

tax professionals and laymen alike as the form filed generally to

report income tax, which is a tax under the Code.

Petitioner’s

challenges to the underlying tax liability and the assessment of

taxes on this basis do not present a genuine issue of material

fact.

In any event, the underlying tax liability is not an issue

that can be raised at the hearing if the taxpayer has received a

notice of deficiency.

See sec. 6330(c)(2)(B).

Although there

was some dispute in the hearing as to whether petitioner

“received” notices of deficiency for taxable years 1990, 1991,

1992, 1993, and 1994, or refused to accept them,6 he failed to

At the Appeals hearing, petitioner argued that he did not

receive the notices of deficiency for the underlying tax

liabilities. The notices of deficiency were sent by certified

mail to petitioner’s last known address; however, the notices

(continued...)

- 10 raise the issue either in the petition or in his response to

respondent’s summary judgment motion and memorandum which did

discuss that issue.

We find that petitioner has conceded the

specific issue of whether he received the notices of deficiency.7

It follows, then, that the underlying tax liability need not be

addressed in our review of the determination.

See Sego v.

Commissioner, 114 T.C. 604, 610-611 (2000); Goza v. Commissioner,

114 T.C. 176, 182-183 (2000).

Petitioner’s principal argument in the Form 12153 and at the

Appeals hearing was:

Whether the IRS recorded an assessment

against petitioner as required by section 6203 and section

301.6203-1, Proced. & Admin. Regs., and whether the Appeals

officer was required to present him with a Form 23C, Assessment

(...continued)

were not accepted and some were returned with the address

obliterated and with the notation “Return to Sender not at this

address”. See sec. 6212(a) and (b)(1). Petitioner argued at the

hearing that the notices must be actually received to be valid.

Similarly, in Davis v. Commissioner, 115 T.C. 35, 39

(2000), the taxpayer failed to present any allegations or facts

in his petition to this Court so as to raise the issue of whether

a notice of deficiency was received. We stated:

Petitioner does not allege that he did not receive a

notice of deficiency for the tax liabilities in issue,

nor does he allege that he did not have an opportunity

to contest the deficiency determinations. Because

petitioner failed to aver the facts specified in

section 6330(c)(2)(B), which are required to put the

underlying tax liability in issue, petitioner’s

underlying tax liability is not properly before the

Court. [Citation omitted.]

- 11 Certificate, which is the summary record of assessment.8

The

Appeals officer informed petitioner that a Form 4340 was

sufficient to verify that the taxes were properly assessed.

The

Appeals officer showed petitioner the Form 4340, which clearly

showed that the assessment of taxes was in fact made and

explained to petitioner its significance.

In Davis v. Commissioner, 115 T.C. 35 (2000), the taxpayer

involved argued that a “valid” summary record of assessment did

not exist because he was not given a Form 23C.

We held that the

Appeals officer could rely on a Form 4340 to verify that a valid

assessment existed.

Id. at 40-41.

Since the taxpayer did not

point to any irregularity in the assessment procedure, we granted

respondent’s motion for a judgment on the pleadings.

Id. at 41.9

Sec. 6203 requires the Secretary to record a liability of

the taxpayer and to furnish a copy of the record of assessment to

the taxpayer on request. Sec. 301.6203-1, Proced. & Admin.

Regs., provides that an assessment officer shall make the

assessment and sign a “summary record of assessment”. This

record “through supporting records” shall identify the taxpayer,

the character of the liability, the taxable period, and the

amount of the assessment.

Form 4340, Certificate of Assessments and Payments,

provides presumptive evidence that an assessment has in fact

occurred. See Nicklaus v. Commissioner, 117 T.C. ___, ___ (2001)

(slip op. at 8); Davis v. Commissioner, supra at 40; Wylie v.

Commissioner, T.C. Memo. 2001-65. Nevertheless, it is not

conclusive and further examination may be required in some

instances where the taxpayer points to an irregularity. See,

e.g., Huff v. United States, 10 F.3d 1440, 1446 (9th Cir. 1993)

(where the assessment date did not appear on Form 4340). But, in

a case such as this, where the taxpayer presents no evidence of

an irregularity, the presumption remains applicable. See Hughes

(continued...)

- 12 The same is true of this case:

The Appeals officer verified that

the assessments were made with a Form 4340, and petitioner has

presented no evidence of any irregularity in the assessment

procedure.

No genuine issue of material fact has been presented.

Petitioner also argued in the Form 12153 attachment that he

did not receive a notice and demand for payment as required under

section 6303.10

It is not apparent from that attachment whether

petitioner was challenging the physical “receipt” of the notice

or the validity of the notice received.

In any event, petitioner

did not raise the issue at the Appeals hearing, in his petition

to this Court, or in his response to respondent’s motion for

summary judgment.

conceded.

We must, therefore, find that the issue was

See Nicklaus v. Commissioner, 117 T.C. ___, ___ (2001)

(slip op. at 6 n.4).

Petitioner contended throughout the hearing that he could

not present a defense because he was not given a set of

procedures governing the Appeals hearing and the presentment of

issues therein.

Attached to the notice given to petitioner of

his right to a hearing under section 6320 was Publication 1660

(...continued)

v. United States, 953 F.2d 531, 535 (9th Cir. 1992).

Sec. 6303(a) requires the Secretary to send a notice of

assessment of a tax and a demand for payment within 60 days after

the assessment is made. “Such notice shall be left at the

dwelling or usual place of business of such person, or shall be

sent by mail to such person’s last known address.” Sec. 6303(a).

- 13 that described his appeal rights and invited him to raise issues,

including the issues referred to in the relevant statutes.

The

Appeals officer encouraged petitioner on multiple occasions to

simply raise the issues he wanted to present, noting that the

hearing was intended to be informal and no formal set of

procedures governed the hearing.

Petitioner was nonresponsive

and renewed the same argument on numerous occasions throughout

the hearing.

In Davis v. Commissioner, supra at 41-42, we

emphasized that the hearing process was informal, did not require

testimony under oath, and did not require the compulsory

attendance of witnesses or the production of documents.

Wylie v. Commissioner, T.C. Memo. 2001-65.