Opinion
5602-22P
02-28-2023
MARY LOU WOLFFING, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER AND DECISION
Joseph W. Nega, Judge.
This case is presently calendared for an in-person trial at the session of the Court scheduled to commence on Monday, March 6, 2023, in Boston, Massachusetts.On December 30, 2022, respondent filed a Motion for Summary Judgment (respondent's motion). By Order issued January 18, 2023, the Court directed petitioner to respond to respondent's motion by February 17, 2023. On February 22, 2023, petitioner filed an Objection to Motion for Summary Judgment.
Unless otherwise indicated, all statutory references are to the Internal Revenue Code, Title 26 U.S.C., in effect at all relevant times, all regulation references are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in effect at all relevant times, and all Rule references are to the Tax Court Rules of Practice and Procedure.
Background
On March 2, 2020, respondent issued to petitioner a Letter CP508C, Notice of Certification of Your Seriously Delinquent Federal Tax Debt to the U.S. Department of State (Passport Notice), with respect to petitioner's Federal income tax liabilities for the 2010 and 2012 tax years. The Passport Notice identifies Federal income tax liabilities of $28,231.87 and $33,824.79 for 2010 and 2012, respectively, totaling $62,056.66.
The Passport Notice also identifies additional penalties of $5,490.96 for 2012 and additional interest of $3,410.30 and $3,922.17 for 2010 and 2012, respectively, resulting in liabilities, penalties, and interest totaling $74,880.09.
On April 18, 2018, respondent issued to petitioner a notice of intent to levy, informing petitioner of her collection due process (CDP) rights regarding the 2010 tax year. On July 6, 2018, respondent issued to petitioner a notice of intent to levy, informing her of her CDP rights regarding the 2012 tax year. On September 20, 2019, respondent issued to petitioner a lien notice regarding the 2010 and 2012 taxable years. Petitioner did not request a hearing in response to any of these collection actions.
Petitioner filed her Petition disputing the Passport Notice on March 1, 2022.
Discussion
The purpose of summary judgment is to expedite litigation and to avoid unnecessary trials. Fla. Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988). In cases that are subject to a de novo scope of review, we may grant summary judgment when there is no genuine dispute as to any material fact and a decision may be rendered as a matter of law. Rule 121(b); Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), aff'd, 17 F.3d 965 (7th Cir. 1994). In cases that are decided on the administrative record, we ordinarily decide the issues raised by the parties by reviewing the administrative record using the procedure discussed in Van Bemmelen v. Commissioner, 155 T.C. 64, 78-79 (2020).
As in Rowen v. Commissioner, 156 T.C. 101, 106 (2021), we need not decide in this case either the applicable scope or standard of review. As to the scope of the review, there is no material dispute between the parties regarding the evidence we should consider. As to the standard of review, our decision would be the same whether we reviewed respondent's certification de novo or for abuse of discretion.
Section 7345(a) provides that, if respondent certifies that a taxpayer has "a seriously delinquent tax debt," that certification shall be transmitted "to the Secretary of State for action with respect to denial, revocation, or limitation of [the taxpayer's] passport." Respondent is responsible for notifying the taxpayer contemporaneously with the making of such certification. § 7345(d). A "seriously delinquent tax debt" is a Federal tax liability that has been assessed, exceeds $50,000 (adjusted for inflation), is unpaid and legally enforceable, and with respect to which a lien notice has been filed or a levy made. § 7345(b)(1), (f). The adjusted threshold amount for 2020, the year of petitioner's certification, was $53,000. See Rev. Proc. 2019-44, § 3.59, 2019-47 I.R.B. 1093, 1103.
Section 7345(e)(1) permits a taxpayer whom the IRS has certified as having a seriously delinquent tax debt to petition this Court to determine "whether the certification was erroneous or whether [respondent] has failed to reverse the certification." Section 7345(e)(2) restricts the relief that we may grant. If we determine that a certification is erroneous, we can grant only one remedy: an order that respondent "notify the Secretary of State that such certification is erroneous." § 7345(e)(2). Section 7345 does not authorize us to grant any other form of relief. Ruesch v. Commissioner, 25 F.4th 67, 70 (2d Cir. 2022), aff'g in part, vacating in part and remanding 154 T.C. 289 (2020).
Respondent has met the criteria to certify that petitioner has a "seriously delinquent tax debt." Respondent has supplied Forms 4340, Certificate of Assessments, Payments, and Other Specified Matters, corresponding to petitioner for the 2010 and 2012 tax years. Respondent has also supplied the unsworn declaration of Derrick Thompson, a senior program analyst employed by respondent. Mr. Thompson attested that he reviewed petitioner's computerized account transcripts, which indicated that notices of intent to levy were issued to petitioner with respect to the 2010 and 2012 tax years and that levies were made in 2018, 2019, and 2020 on petitioner's state income tax refunds. The Forms 4340 show that, as of December 1, 2022, petitioner had assessed, unpaid, and legally enforceable Federal income tax liabilities for 2010 and 2012, the sum of which exceeds the $53,000 threshold required for certification. With regard to the 2010 and 2012 Federal income tax liabilities, the Forms 4340 and the unsworn declaration also show a notice of lien was filed (for which CDP rights have since lapsed) and levies were made pursuant to sections 6323 and 6331. See § 7345(b)(1)(C); see also Belton v. Commissioner, T.C. Memo. 2023-13, at *19, *22.
To the extent petitioner is seeking to challenge the amount of her underlying tax liability or the lawfulness of respondent's collection actions, such challenges would be impermissible. The only determination we are authorized to make is whether the Commissioner's certification of a taxpayer as a person having a seriously delinquent tax debt (or his failure to reverse a certification) "was erroneous." § 7345(e)(1). And the only relief we are authorized to grant is to order the Commissioner "to notify the Secretary of State that such certification was erroneous." § 7345(e)(2); see Garcia v. Commissioner, 157 T.C. 1, 9-10 (2021). Section 7345 does not permit taxpayers to challenge, in a passport case such as this, the assessed tax liabilities that have triggered their certification. Ruesch v. Commissioner, 154 T.C. 289, 296-97 (2020), aff'd in part, vacated and remanded in part, 25 F. 4th 67 (2d Cir. 2022); accord Adams, 160 T.C., slip op. at 10-13 (readopting Ruesch's jurisdictional holding). On the basis of the undisputed facts, the Commissioner has shown that petitioner's 2010 and 2012 liabilities meet the requirements for certification to the Secretary of State as a "seriously delinquent tax debt." See § 7345(e)(1).
In her Petition, petitioner alleges that the State Department's revocation of her passport, following receipt of the Passport Notice from respondent, has caused an "restraint of her liberty and her unalienable right of freedom to movement." To the extent that petitioner appears to raise a substantive or procedural due process challenge to section 7345, we find that such an argument is unpersuasive. See Rowen, 156 T.C. at 111-12, 115-16 (finding taxpayer's substantive due process arguments meritless and procedural due process arguments insufficiently developed); see also Adams v. Commissioner, 160 T.C. No. 1, slip op. at 17-18 (Jan. 24, 2023) (holding that this Court lacks jurisdiction to review the passport actions of the Secretary of State).
Accordingly, upon due consideration, it is
ORDERED that respondent's Motion for Summary Judgment, dated December 30, 2022, is granted. It is further
ORDERED that this case is stricken from the Court's Boston, Massachusetts session commencing March 6, 2023. It is further
ORDERED AND DECIDED that respondent's certification that petitioner has a seriously delinquent tax debt, reflected in the Letter CP508C, dated March 2, 2020, upon which this case is based, is sustained.