Opinion
21277-18L
08-23-2021
Guadalupe Ruiz & Maria C. Ruiz, Petitioners v. Commissioner of Internal Revenue, Respondent
ORDER
Courtney D. Jones Judge
This case was scheduled for trial at the remote trial session of the Court scheduled to commence at San Antonio, Texas, on January 25, 2021. On November 12, 2020, we struck this case from the calendar and granted respondent's motion to remand.
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Background
On October 29, 2018, petitioners Guadalupe Ruiz and Maria C. Ruiz (Mr. and Mrs. Ruiz) filed a petition to commence this case. Petitioners were married and residents of Texas when they filed their petition. Attached thereto was a notice of determination concerning collection actions under section 6320 or section 6330 (notice of determination) regarding the 2013 tax year.
Unless otherwise indicated, all section references are to the Internal Revenue Code in effect at all relevant times, and all Rule references are to the Tax Court Rules of Practice and Procedure.
On March 16, 2021, the Internal Revenue Service (IRS) Independent Office of Appeals (Office of Appeals) issued a supplemental notice of determination, addressed to both Mr. and Mrs. Ruiz. On March 24, 2021, respondent filed a status report informing the Court of the death of Mr. Ruiz.
The Court uses the term "Internal Revenue Service" or "IRS" to refer to administrative actions taken outside of these proceedings. The Court uses the term "respondent" to refer to the Commissioner of Internal Revenue, who is the head of the IRS and is respondent in this case, and to refer to actions taken in connection with this case.
On June 9, 2021, in response to the Court's order, respondent filed a status report representing that the IRS never issued Mrs. Ruiz a Notice CP90, Intent to Seize Your Assets and Notice of Your Right to a Hearing. As such, respondent's counsel contends that the notice of determination sent to Mrs. Ruiz was not a valid notice of determination. Accordingly, respondent represented that respondent would file a motion to dismiss for lack of jurisdiction as to Mrs. Ruiz.
On August 2, 2021, respondent filed a status report updating the Court on respondent's efforts to determine the appropriate person to represent the interests of the estate of Mr. Ruiz. Respondent attached a copy of the death certificate of Mr. Ruiz, which appears to have been issued by the State of Texas (Department of State Health Services - Vital Statistics).
Discussion
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I. Jurisdiction as to Mrs. Ruiz in the CDP Case
This Court is a court of limited jurisdiction, and we may exercise that jurisdiction only to the extent authorized by Congress. Naftel v. Commissioner, 85 T.C. 527, 529 (1985). The Court's jurisdiction to review certain collection activity by the IRS under sections 6320 and 6330 depends on the issuance of a valid notice of determination and the timely filing of a petition with the Court for review. Orum v. Commissioner, 123 T.C. 1 (2004), aff'd, 412 F.3d 819 (7th Cir. 2005); Moorhous v. Commissioner, 116 T.C. 263, 269 (2001); see also Rule 330(b). An invalid notice cannot form the basis for our jurisdiction. See sec. 6330(c)(3); LG Kendrick, LLC v. Commissioner, 146 T.C. 17, 29 (2016); Smith v. Commissioner, 124 T.C. 36, 44 (2005).
Although the Office of Appeals' determination need not follow a particular format, the determination must be in writing. See Craig v. Commissioner, 119 T.C. 252 (2002), Lunsford v. Commissioner, 117 T.C. 159, 164 (2001); sec. 301.6330-1(e), Q & A-E8, Proced. & Admin. Regs. A notice of determination "must specify to which taxable period, liability, and collection action it relates or, at least provide sufficient information so that the taxpayer cannot reasonably be deceived as to these items". LG Kendrick, LLC v. Commissioner, 146 T.C. 17, 28-29 (2016) (citing Commissioner v. Forest Glen Creamery Co., 98 F.2d 968, 971 (7th Cir.1938), rev'g and remanding 33 B.T.A. 564 (1935); Erickson v. Commissioner, T.C. Memo.1991-97, 61 T.C.M. (CCH) 2073, 2076-2077 (1991)).
In Lunsford, in determining the validity of a notice of determination, we reversed our prior holding in Meyer v. Commissioner, 115 T.C. 417, 422-423, 2000 WL 1672623 (2000). In Meyer, we acknowledged that there was no dispute that the Court lacked jurisdiction in the case. But we held that the ground for dismissing the case was the invalidity of the determination letters; the taxpayer was not given an opportunity for an Office of Appeals hearing. See Lunsford v. Commissioner, 117 T.C. at 163; Meyer v. Commissioner, 115 T.C. at 422-423. In Lunsford, we held that it was unnecessary to look behind the determination to see whether the taxpayers were afforded an appropriate Office of Appeals hearing to have jurisdiction. Id. We further held that "[o]ur jurisdiction under section 6330(d)(1)(A) is established when there is a written notice that embodies a determination to proceed with the collection of the taxes in issue, and a timely filed petition." Id. at 164. We request that respondent's counsel address the potential impact of Lunsford on this case.
In the event the notice of determination issued to Mrs. Ruiz was not valid, this is not the end of our inquiry as to the next course of action in this case. In Atlantic Pacific Management Group., LLC v. Commissioner, 152 T.C. 330, 333-334 (2019), we addressed the discrepancies in our caselaw surrounding our authority to ascertain whether the IRS complied with statutory requirements in CDP cases when we are determining jurisdiction. In Buffano v. Commissioner, T.C. Memo. 2007-32, 2007 WL 424705, at *2, no notice of determination was issued by the Office of Appeals but we nonetheless examined the Commissioner's compliance with the statutory requirement that a Final Notice of Intent to Levy be mailed to a taxpayer's last known address. We held that the Final Notice of Intent to Levy upon which a notice of determination would have been based was invalid since it was not mailed to the appropriate address and accordingly, we dismissed and invalidated the underlying levy notice. Id. at *5.
In Adolphson v. Commissioner, 842 F.3d 478, 480 (7th Cir. 2016), the Court of Appeals for the Seventh Circuit disagreed with our holding in Buffano. In Adolphson, the taxpayer argued that the levies at issue were invalid because the IRS had not mailed him a Final Notice of Intent to Levy as required, so he was deprived of the right to challenge the liability in a CDP hearing before the Office of Appeals. As such, the taxpayer lacked the requisite notice of determination. The Court of Appeals for the Seventh Circuit held that "[a] decision invalidating administrative action for not following statutory procedures is a quintessential merits analysis, not a jurisdictional ruling." Adolphson v. Commissioner, 842 F.3d at 484. Nevertheless, the Appeals Court affirmed the decision that we lacked jurisdiction to consider the taxpayer's challenge to the levies. In Atlantic Pacific Management Group., LLC, we did not rule whether to overturn Buffano and follow Adolphson as the facts of the case did not necessitate such ruling.
II. Authority of Surviving Spouse to Represent Deceased Spouse under Texas Law
Under Texas law it appears that a surviving spouse may commence or continue a case on behalf of the deceased spouse. Texas Estates Code sec. 453.003. Estate of Berry v. Commissioner, 41 T.C. 702 (1964).
In light of the foregoing, it is
ORDERED that, on or before September 16, 2021, respondent shall file an appropriate jurisdictional motion or status report informing the Court whether respondent considers the Court to have jurisdiction as to Mrs. Ruiz in this CDP case. In the jurisdictional motion or status report, respondent's counsel shall address the import of the following cases: Adolphson v. Commissioner, 842 F.3d 478 (7th Cir. 2016); Lunsford v. Commissioner, 117 T.C. 159 (2001); Buffano v. Commissioner, T.C. Memo. 2007-32. It is also
ORDERED that, on or before September 16, 2021, respondent shall file an appropriate jurisdictional motion or status report informing the Court whether respondent considers the Court to have jurisdiction as to Mrs. Ruiz's innocent spouse claim. It is also
ORDERED that, on or before September 16, 2021, respondent shall advise the Court of its position as to whether Mrs. Ruiz has authority to represent the interests of the Estate of Guadalupe Ruiz, deceased.
ORDERED that the caption in this case is changed to "Guadalupe Ruiz, Deceased, Maria C. Ruiz, Surviving Spouse, & Maria C. Ruiz, Petitioners, v. Commissioner of Internal Revenue, Respondent."
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