Opinion
10043-22L
03-09-2023
ALIZA CANCILLER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER AND DECISION
Kathleen Kerrigan Chief Judge
The Petition in this case was filed in response to a notice of determination concerning collection actions under section 6320 and/or 6330 dated March 9, 2022, upholding a proposed levy collection action for unpaid tax liabilities for 2004, 2005, 2006, 2007, 2008, 2009, 2010, 2015, 2016, 2017, and 2018 (years in issue). This matter is before the Court on respondent's Motion for Summary Judgment pursuant to Rule 121, filed October 19, 2022. To date petitioner has not filed a response to respondent's motion.
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.
There are no genuine issues of material fact in this case, and we conclude that respondent is entitled to judgment as a matter of law as provided herein.
Background
Petitioner resided in California when she filed her Petition.
Petitioner's outstanding tax liabilities arose from the original returns she filed for the years in issue. She did not pay taxes due on her returns. On February 3, 2020, respondent issued a notice of intent to levy. Petitioner responded to the notice of intent with a Form 12153, Request for a Collection Due Process (CDP) or Equivalent Hearing. On her Form 12153, petitioner indicated that she could not make a monthly installment payment of $3,128.
Petitioner was mailed a letter dated February 11, 2021, advising her that her case had been received by the IRS Independent Office of Appeals (Appeals) for consideration and that a telephone conference had been scheduled for March 22, 2020. Petitioner did not contact the assigned settlement officer on March 22, 2021.
Petitioner was sent a letter on March 22, 2021, requesting that she provide information, including Form 433-A, Collection Information Statement, the last three months of bank statements, proof of expenses and income, to Appeals no later than April 5, 2021. The letter advised petitioner that if she did not respond, Appeals would issue a determination letter based on the administrative file, the case history, and petitioner's request for CDP hearing. On April 5, 2021, the settlement officer spoke with petitioner and explained that the telephone conference had been missed and that the requested information had not been received to determine collectability. Petitioner was given installment agreement options that did not require Form 433-A and supporting documents. Petitioner agreed to provide supporting documents by April 12, 2021.
On February 8, 2022, petitioner was sent a correspondence that explained collectability determination based on Form 433-A and that petitioner had the ability to pay $1,518 per month. Petitioner was asked to contact the office by February 22, 2022, to discuss installment agreement options or provide the last three months of bank statements, proof of income and expenses to be considered.
As of March 2, 2022, petitioner had not provided the requested information or contacted the settlement officer to discuss the installment agreement options. Respondent issued a determination based on the available information to not sustain the notice of intent to levy petitioner's assets.
Discussion
Summary judgment may be granted where the pleadings and other materials show that there is no genuine dispute as to any material fact and that 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). The burden is on the moving party (in this case, respondent) to demonstrate that there is no genuine dispute as to any material fact and that he or she is entitled to judgment as a matter of law. FPL Grp., Inc. & Subs. v. Commissioner, 116 T.C. 73, 74-75 (2001). In all cases, the evidence is viewed in the light most favorable to the nonmoving party. Bond v. Commissioner, 100 T.C. 32, 36 (1993). The nonmoving party may not rest upon mere allegations or denials in his or her pleadings but must set forth specific facts showing that there is a genuine dispute for trial. Sundstrand Corp. v. Commissioner, 98 T.C. at 520.
Petitioner has failed to demonstrate, by affidavits or other acceptable materials, that there is a genuine issue for trial. Rule 121(d). Consequently, we conclude that there is not dispute as to any material fact and that a decision may be rendered as a matter of law.
Section 6331(a) authorizes the Secretary to levy upon the property and property rights of a taxpayer who fails to pay a tax within 10 days after notice and demand. Before the Secretary may levy upon the taxpayer's property, the Secretary must notify the taxpayer of the Secretary's intention to make the levy. § 6331(d)(1). The Secretary must also notify the taxpayer of his or her right to a CDP hearing. § 6330(a)(1).
If the taxpayer requests a CDP hearing, the hearing is conducted by Appeals. § 6330(b)(1). At the hearing the taxpayer may raise any relevant issue relating to the unpaid tax or the proposed collection action. § 6330(c)(2)(A).
Section 6330 requires the Secretary to furnish a person notice and opportunity for a hearing before an impartial officer or employee of Appeals before levying on the person's property. The person may challenge the existence or the amount of the underlying tax liability for any period only if the person did not receive a notice of deficiency or did not otherwise have an opportunity to dispute the liability. § 6330(c)(2)(B); Sego v. Commissioner, 114 T.C. 604. 609 (2000).
Following the hearing, the Appeals officer must determine whether proceeding with the proposed levy action is appropriate. In making that determination, the Appeals officer is required to take into consideration: (1) whether the requirements of any applicable law or administrative procedure have been met; (2) any issues appropriately raised by the taxpayer; and (3) whether the proposed collection action balances the need for the efficient collection of taxes with the legitimate concern of the taxpayer that any collection action be no more intrusive than necessary. § 6330(c)(3); see also Lunsford v. Commissioner, 117 T.C. 183, 184 (2001).
Where, as here, the taxpayer does not challenge the underlying liability, our review is for abuse of discretion. Sego v. Commissioner, 114 T.C. at 610. An abuse of discretion occurs if Appeals exercises its discretion "arbitrarily, capriciously, or without sound basis in fact or law." Woodral v. Commissioner, 112 T.C. 19, 23 (1999). The Court does not conduct an independent review and substitute its judgment for that of the settlement officer. Murphy v. Commissioner¸125 T.C. 301, 320 (2005), aff'd, 469 F.3d 27 (1st Cir. 2006). If the Appeals officer follows all statutory and administrative guidelines and provides a reasoned, balanced decision, the Court will not reweigh the equities. Link v. Commissioner, T.C. Memo. 2013-53 at *12.
The settlement officer did not abuse her discretion by sustaining the proposed levy because of petitioner's failure to submit requested Federal tax returns, financial information, or a collection alternative. We have held consistently that it is not an abuse of discretion for a settlement officer to sustain a collection action where the taxpayer has failed, after being given sufficient opportunities, to provide financial information during the administrative hearing and was not currently in compliance with Federal tax laws, i.e., had not filed all required tax returns. See Huntress v. Commissioner, T.C. Memo. 2009-161.
ORDERED that respondent's motion for summary judgment dated October 19, 2022, is granted. It is further
ORDERED AND DECIDED that respondent's notice of determination, dated March 9, 2022, upon which this case is based, is sustained.