Opinion
22405-19L
07-18-2023
DENISE CELESS GARRIS, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
David Gustafson Judge
Now before the Court in this "collection due process" ("CDP") case is a "Motion for Reconsideration of Order" (Doc. 23) filed by petitioner Denise Celess Garris. We will treat the motion as a motion to vacate or revise the stipulated decision (Doc. 22) that was entered February 18, 2022, and we will order the Commissioner to file a response.
Background
Ms. Garris's liability for 2014 income tax (including an accuracy-related penalty) was not fully paid, and the Internal Revenue Service ("IRS") issued one or more collection notices in September 2016. The very spare record in this case seems not to include any copy of such a notice. Ms. Garris apparently submitted to the IRS's Independent Office of Appeals ("IRS Appeals") a request for a CDP hearing (but that request is also not in our record), and we have no information about that hearing except for what is given in the notices of determination described below.
Notice of Determination as to lien only
On November 26, 2019, IRS Appeals issued to Ms. Garris a "Notice of Determination Concerning Collection actions under IRC Sections 6320 or 6330 of the Internal Revenue Code" (which was attached to Ms. Garris's petition). That notice sustained the filing of a notice of federal tax lien for one taxable year--i.e., the year 2014. The "Summary of Determination" refers to a Notice of Federal Tax Lien ("NFTL") and does not refer to a proposed levy. On the attachment, the "Type of hearing" is stated to be "6320"--i.e., a reference to I.R.C. sec. 6320, which is the provision as to liens, not levies (which are addressed in sec. 6330); and the column marked "Date of CDP Notice" gives only one date (i.e., "09/27/2016"). The "Brief Background" refers to an NFTL and not to a proposed levy.
As far as we can tell, the only arguable mentions of a proposed levy in the notice of determination are three disjunctive references to lien or levy: The title of the notice includes reference to "Sections 6320 or 6330"; the "Legal and Administrative Review" section of the attachment states that "IRS records confirmed the proper issuance of the ... Notice of Intent to Levy and/or Notice of Federal Tax Lien (NFTL) filing" and states that "[t]here was a balance due when the Notice of Intent to Levy was issued or when the NFTL filing was requested." That is, in CDP cases IRS Appeals uses a multi-purpose form letter that works for a lien case, for a levy case, and for a case that involves lien and levy, sparing the Appeals Officer the chore of specifying what sort of determination he is issuing and requiring the reader to discern what sort of determination he has received.
Cf. Lacey v. Commissioner, 153 T.C. 146, 170 (2019), abrogated by Li v. Commissioner, 22 F.4th 1014 (D.C. Cir. 2022) ("we note an imprecision in the [whistleblower rejection] letter, resulting from its use of 'and/or'--i.e., it held that the claim 'was speculative and/or did not provide specific or credible information'. (Emphasis added.) Admittedly, these two alternatives overlap, but the use of 'and/or' allows the writer to avoid specifying. Was there one reason the claim was rejected? If so, which one? Or were there two reasons? If we look at the staff recommendations that preceded the decision, but see Chenery II, 332 U.S. at 196, 67 S.Ct. 1760, they give no help, since one says 'and/or' and the other says 'or'. It is unclear how we should review the WBO's multiple-choice letter from November 2015"); Alber v. Commissioner, 119 T.C.M. (CCH) 1126 (T.C. 2020) "The Commissioner's form letter contained the same 'and/or' conjunction that led to unclarity in Lacey . . . . But on the record of this case, with the benefit of the detail in the ARM, all of the listed reasons for the rejection are warranted, so we need not pick and choose. However, we continue to be concerned that, in a closer case, this form text may create confusion when we review a summary rejection of a whistleblower claim"); All Is Well Homecare Services, LLC v. Commissioner, Tax Court No. 21210-19L (Dec. 22, 2022), Order at 10-11 ("A form that is merely ambiguous or unclear might or might not implicate an abuse of discretion, depending on (1) how serious the problems are and (2) how IRS Appeals administers the use of the form").
The November 2019 notice of determination issued to Ms. Garris did not refer to any notice of proposed levy, to any request for IRS Appeals' review of a proposed levy, nor to the sustaining of any proposed levy. We conclude it was a notice of determination addressing only a lien notice.
Tax Court petition and remand
Ms. Garris challenged IRS Appeals's notice of determination by filing her petition in the Tax Court. On November 20, 2020, the Commissioner filed a motion (Doc. 7) to remand the case to IRS Appeals for further consideration.
The motion asserted without further comment that this case "stems from respondent's November 25, 2019 determination notices as to proposed levy collection action and a lien notice filing against petitioner"--i.e., both lien and levy. As far as we can tell, this is the first assertion in our record that a proposed levy was involved in this case--a fact not noticed by the judge signing this order. We granted the motion to remand. (See Doc. 10.)
Supplemental Notice of Determination as to lien and levy
On October 18, 2021, IRS Appeals issued a "Supplemental Notice of Determination" (see Doc. 20, Ex. A). The supplemental notice again sustained the filing of the notice of lien, but it also made conjunctive references to a proposed levy:
First, the "Summary of Determination" in the notice itself and the "Summary and Recommendation" in the Attachment both stated: "Based on available facts, ... the issuance of the Final Notice of Levy and filing of the Notice of Federal Tax Lien was proper and appropriate. However, the proposed levy action is not now sustained, and the filing of the Notice of Federal Tax Lien is sustained."
Second, the column marked "CDP Notice Date" gives two dates (i.e., "09/27/2016" and "09/12/2016"), as if there were two collection notices underlying the CDP hearing.
Third, the "Brief Background" section states: "The taxpayer submitted a timely collection due process hearing request in response to the issuance of a Final Notice of Intent to Levy and the filing of a Notice of Federal Tax Lien .... On November 29, 2019, the IRS issued a Notice of Determination sustaining its proposed levy action and lien filing.... In its remand, the Tax Court stated that in determining whether a proposed levy may proceed, or a lien notice filing should be upheld, the assigned Appeals Officer must obtain verification ...." (We do not see in our record any order by this Court mentioning a proposed levy.) IRS Appeals' "Conclusion" in the supplemental notice states twice (in a section on "Balancing"): "The proposed levy action is not now sustained".
Proposed Stipulated Decision silent as to both lien and levy
On February 16, 2022, the parties to this case filed a proposed stipulated decision (Doc. 21), asking us to enter decision holding that the determinations set forth in IRS Appeals' November 2019 notice of determination, "as supplemented by the Notice of Determination on October 18, 2021, are sustained in full." Underneath the space for the judge's signature on that proposed decision document, the parties stated their stipulation that "collection of petitioner's income tax liability for the taxable year 2014 shall be made in accordance with the terms of the Installment Agreement, signed August 31, 2021, and countersigned September 28, 2021, entered into between the parties pursuant to the provisions of I.R.C. sec. 6159." The installment agreement is not in our record.
Neither the proposed decision nor the attached stipulation explicitly mentions lien or levy, and it quotes the title of the notice to refer to "Section 6320 and/or 6330". No tax year other than 2014 is referred to in the proposed stipulated decision We granted the parties' request and entered that decision on February 18, 2022.
Petitioner's motion
More than 16 months later, Ms. Garris filed with the Court a letter; and on the cover sheet for that feeling, she called the document a "Motion for Reconsideration of Order". It appears that the "Order" to which she refers is the decision that we entered at the parties' request, and what she evidently requests is not a "reconsideration" under Rule 161 but rather a vacating or revising of our decision under Rule 162. However, she does not mention any aspect of the decision (nor of any order we have issued in the case) that she would have us reconsider or revise.
Rather, she alleges that she "entered into an agreement [with the IRS] on 2-18-22"--the date we entered decision--and she apparently argues that the IRS has not complied with that agreement. (Although she does not submit a copy of any agreement, she refers to issues such as a waiver of penalties and interest and the proper application of her payments to 2014 and 2019 (a year not included in the CDP hearing or the notice of determination.) If there was such an agreement, it does not seem to be part of the November 2019 notice of determination (supplemented in October 18, 2021) that is the subject of our review in this case.
It may be that the "agreement" to which she refers is simply the parties' stipulations on the proposed decision document, which does specifically refer to an installment agreement. If so, she sometimes treats them as an agreement of the parties and sometimes as having been ordered by the Court. However, those stipulations, though appended to the Court's decision, are an agreement of the parties, and not an order of the Court.
Discussion
The character of the motion
Although Ms. Garris styled her motion as a motion for "reconsideration" under Rule 161, we have issued in this case no opinion making findings of fact. We simply entered a decision that the parties jointly proposed. We infer that the relief Ms. Garris actually seeks is the vacating or correcting of that decision, and we therefore will characterize her submission as a motion to vacate or revise decision under Rule 162.
Strict limits on motions under Rule 162
Rule 162 provides that a motion to vacate a decision "shall be filed within 30 days after the decision has been entered", whereas Ms. Garris's motion was more than a year late. As we stated in Snow v. Commissioner, 142 T.C. 413, 419 (2014), "As a general rule, the finality of a decision [under section 7481] is absolute. . . . There are very few exceptions." One exception is where there was a fraud on the court, which Ms. Garris does not seem to allege.
However, we observed in Snow that we have "vacated an otherwise final decision in a situation where the Court had never acquired jurisdiction to make a decision. See Abeles v. Commissioner, 90 T.C. 103 (1988); accord Seven W. Enters., Inc. & Subs. v. Commissioner, 723 F.3d 857 (7th Cir. 2013), vacating and remanding 136 T.C. 539 (2011); Billingsley v. Commissioner, 868 F.2d 1081, 1084-1085 (9th Cir. 1989); Brannon's of Shawnee, Inc. v. Commissioner, 69 T.C. 999, 1002 (1978)." On the scant record before us, we cannot eliminate the possibility that there might be a jurisdictional issue in this case.
Possible jurisdictional issue in this case
If in September 2016 the IRS did issue (as it alleges) both a notice of lien filing and a notice of proposed levy, and if (as the IRS seems to assume) Ms. Garris requested a CDP hearing as to both lien and levy, then IRS Appeals' November 2019 determination apparently addressed (and sustained) only the notice of lien filing, and did not constitute a determination as to the levy notice. Thus, Ms. Garris was granted a CDP hearing as to the lien; but as to the levy, the CDP process has not yet been completed.
Therefore, on these assumptions, Ms. Garris did not have the predicate for filing a Tax Court petition as to any proposed levy. Rather, when she filed her petition, we acquired jurisdiction to review only the lien-based determinations in the November 2019 notice. "Our jurisdiction over a given case is determined at the time the suit is filed, see Charlotte's Office Boutique, Inc. v. Commissioner, 425 F.3d 1203, 1208 (9th Cir.2005), affg. 121 T.C. 89 (2003) and T.C. Memo.2004-43". Bent v. Commissioner, T.C. Memo. 2009-146, 97 T.C.M. (CCH) 1825.
In that circumstance, IRS Appeals' issuance of the supplemental notice of determination in October 2021 purporting to make determinations as to the levy would not expand our jurisdiction in this case (filed in December 2019) to include review of the proposed levy described in that supplemental determination. Moreover, it is unclear whether the October 2021 "supplemental" notice of determination--which supplemented the (lien-based) determinations and was undertaken in a remand of the (lien-based) Tax Court case and pursuant to a Tax Court remand order--could constitute not just a determination "supplemental" to IRS Appeals' lien-based notice of determination but also a distinct levy-based "determination" (for purposes of section 6330(c)(3) and (d)(1)), so that the 30-day deadline for starting a levy-based suit began to run in October 2021 (and taxpayer was obliged to file a second CDP petition).
If IRS Appeals' October 2021 "supplemental" determination did constitute a new determination, then the question arises whether any resulting deadline should be tolled, see Boechler, P.C. v. Commissioner, 596 U.S., slip op. at 11 (2022), because the taxpayer did not know (and, in fairness, could not have known) that a new, deadline-generating determination had just been issued.
If IRS Appeals' October 2021 "supplemental" determination did not constitute a new determination, then apparently the CDP hearing as to the proposed levy is still pending (perhaps unbeknownst to IRS Appeals and Ms. Garris). Only after IRS Appeals has issued a determination, could Ms. Garris file a petition seeking Tax Court review as to the proposed levy (and only then would the Tax Court could have jurisdiction to review such a determination).
If a jurisdictional issue makes possible, at this late date, the vacating or revising of our decision entered in February 2022, then we may need to learn more about the merits of Ms. Garris's allegations as to IRS collection activity that (she says) violates her agreement. The Commissioner should address those merits and, if he contends they fall outside our jurisdiction, should tell us his view as to what a taxpayer's remedy is when, after a CDP case sustaining a notice of determination after the taxpayer and IRS Appeals reached an agreement, the IRS fails (more than 30 days after decision is entered) to honor that agreement.
The Tax Court operates under Congressionally mandated strictures that define what we can and cannot address. The parties sometimes have liberty to go beyond those strictures. This might be a case in which the parties can resolve any disputes more efficiently and justly than the courts can. We encourage them to attempt to do so.
Until we know more about the issues set out above, and until we better understand the facts Ms. Garris alleges, we cannot determine how to proceed. It is therefore
ORDERED that Ms. Garris's filing shall be characterized as a Motion to Vacate or Revise Decision under Rule 162. It is further
ORDERED that, no later than August 21, 2023, the Commissioner shall file a response to Ms. Garris's motion that shall address the issues stated herein.