Opinion
Docket No. 4187-19S
05-05-2021
Steve Monser Petitioner v. Commissioner of Internal Revenue Respondent
ORDER
Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is
ORDERED that the Clerk of the Court shall transmit herewith to petitioner and to respondent a copy of the pages of the transcript of the trial in the above captioned case before Special Trial Judge Daniel A. Guy, Jr., at Philadelphia, Pennsylvania, on April 19, 2021, containing his oral findings of fact and opinion rendered at the trial session at which the case was heard.
In accordance with the oral findings of fact and opinion, an appropriate order and decision will be entered.
(Signed) Daniel A. Guy, Jr.
Special Trial Judge Bench Opinion by Judge Daniel A. Guy, Jr. April 22, 2021
THE COURT: The Court has decided to render oral findings of fact and opinion in this case, and the following represents the Court's oral findings of fact and opinion. The oral findings of fact and opinion shall not be relied upon as precedent in any other case.
This proceeding for review of a final determination disallowing petitioner's claim for interest abatement is a small tax case conducted pursuant to the provisions of section 7463 of the Internal Revenue Code of 1986, as amended, and Rules 170 through 174 of the Tax Court Rules of Practice and Procedure.
This bench opinion is made pursuant to the authority granted by section 7459(b) of the Internal Revenue Code of 1986, as amended, and Rule 152 of the Tax Court Rules of Practice and Procedure. Hereinafter in this bench opinion, section references are to the Internal Revenue Code of 1986, as amended, and Rule references are to the Tax Court Rules of Practice and Procedure.
Petitioner appeared at trial pro se. Nicholas Lyskin appeared on behalf of respondent. The parties filed with the Court a stipulation of facts, with accompanying exhibits, that is incorporated herein by this reference. The primary issue for decision is whether respondent abused his discretion in disallowing petitioner's claim for abatement of interest for the taxable years 2014, 2015, and 2016 (years in issue).
Background
Petitioner filed Federal income tax returns for the years in issue, the IRS commenced examinations of those returns, and timely issued notices of deficiency to petitioner determining adjustments that would result in additional tax, penalties, and interest for the years in issue.
Petitioner did not timely file petitions for redetermination with the Court challenging the notices of deficiency for the years in issue. In due course, the IRS assessed the tax, penalties, and interest attributable to the adjustments determined in the notices of deficiency. The IRS entered the assessments for 2014, 2015, and 2016 on August 14, 2017, July 16, 2018, and December 10, 2018, respectively.
By letter dated September 13, 2018, petitioner submitted to the IRS separate Forms 843, Claim for Refund and Request for Abatement, for the years in issue.
Petitioner did not allege in any of the Forms 843 that an IRS officer or employee was responsible for an unreasonable error or delay in the performance of a ministerial or managerial act. On February 13, 2019, the IRS issued a final determination to petitioner disallowing his claim for abatement of interest for the years in issue.
On February 25,2019, petitioner filed a petition with the Court stating that he was seeking "to resolve IRS tax audits for tax years 2014, 2015, and 2016" and he attached numerous IRS notices and letters, including the final determination dated February 13, 2019, disallowing his claim for interest abatement for the years in issue.
On January 8, 2021, petitioner filed several declarations with the Court, one of which he filed as a motion to restrain assessment or collection or to order refund of amount collected.
By Order issued March 1, 2021, the Court granted respondent's motion to dismiss for lack of jurisdiction, filed February 12, 2021, requesting that the Court dismiss so much of the petition as purported to challenge notices of deficiency for the years in issue on the ground the petition was not filed within the time prescribed in section 6213(a). The Court acknowledged in its Order that petitioner had timely invoked the Court's jurisdiction under section 6404(h) to review the final determination letter disallowing his claim for interest abatement
Discussion
Section 6601(a) provides the general rule that interest shall be paid on any tax imposed under the Internal Revenue Code that is not otherwise timely paid. The Court's authority to review interest assessed under section 6601 is quite limited. See Urbano v. Commissioner, 122 T.C. 384, 390 (2004).
As is relevant here, section 6404(h) authorizes the Court to review an action brought by a taxpayer to determine whether the Commissioner's failure to abate interest under that section was an abuse of discretion. See Woodral v. Commissioner, 112 T.C. 19, 23 (1999).
Section 6404(e)(1)(A) authorizes the Commissioner to abate an assessment of interest on a tax deficiency when the interest is "attributable * * * to any unreasonable error or delay by an officer or employee of the Internal Revenue Service * * * in performing a ministerial or managerial act". A ministerial act is "a procedural or mechanical act that does not involve the exercise of judgment or discretion, and that occurs during the processing of a taxpayer's case after all prerequisites to the act, such as conferences and review by supervisors, have taken place." Sec. 301.6404-2(b)(2), Proced. & Admin. Regs. A managerial act is "an administrative act that occurs during the processing of a taxpayer's case involving the temporary or permanent loss of records or the exercise of judgment or discretion relating to management of personnel." Id. subpara. (1).
Petitioner asserts that it would be neither fair nor just to permit respondent to assess penalties and interest in this case because he never intended to avoid paying taxes for the years in issue. Although we have no reason to doubt that petitioner did not set out to avoid paying taxes, he has failed to show an abuse of discretion related to interest abatement.
The record shows that the IRS acted in a timely and reasonable manner and followed appropriate procedures in examining petitioner's tax returns, issuing notices of deficiency, and entering assessments for the years in issue. Likewise, although it took some time to resolve the jurisdictional questions presented by the wide ranging and vague petition that petitioner filed to initiate this action, there is no indication of an unreasonable error or delay by an IRS officer or employee in performing a ministerial or managerial act within the meaning of section 6404 in this case.
At trial, the Court directed petitioner's attention to the motion to restrain assessment or collection that he filed on January 8, 2021. Petitioner was uncertain why he filed the motion. In any event, the Court has reviewed the record and finds no evidence of any improper assessment or collection activity.
Consistent with the foregoing, the Court will enter an Order and Decision denying petitioner's motion to restrain assessment or collection and sustaining the final determination disallowing petitioner's claim for abatement of interest. This concludes the Court's oral findings of fact and opinion in this case.
(Whereupon, at 10:08 a.m., the above-entitled matter was concluded.)
CERTIFICATE OF TRANSCRIBER AND PROOFREADER
We, the undersigned, do hereby certify that the foregoing pages, numbers 1 through 9 inclusive, are the true, accurate and complete transcript prepared from the verbal recording made by electronic recording by Gary Baldwin on April 22, 2021 before the United States Tax Court at its remote session in Philadelphia, PA, in accordance with the applicable provisions of the current verbatim reporting contract of the Court and have verified the accuracy of the transcript by comparing the typewritten transcript against the verbal recording.
/s/_________
Meribeth Ashley, CET-507
Transcriber
__________
4/26/21
Date
/s/_________
Lori Rahtes, CDLT-108
Proofreader
__________
4/26/21
Date