Opinion
25804-21SL
04-04-2023
Eric Schultz & Laura Paulsen a.k.a Laura Schultz, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER AND DECISION
Alina I. Marshall Judge
The petition in this collection due process (CDP) case was filed on July 13, 2021, in response to a Notice of Determination Concerning Collection Actions under IRC Sections 6320 or 6330 of the Internal Revenue Code, dated June 7, 2021 (notice of determination). The notice of determination sustained the filing of a notice of Federal tax lien and a proposed levy with respect to petitioners' income tax liability for tax year 2017. In the petition, petitioners do not dispute their underlying liability or assert any abuse of discretion by the Internal Revenue Service (IRS) Independent Office of Appeals (Appeals) settlement officer who conducted their CDP hearing. Petitioners instead contend that Ms. Paulsen had just lost her job when the petition was filed, they do not have the means to pay the liability, and the imposition of the levy would result in a financial hardship.
By notice served February 25, 2022, the case was set for trial at the Salt Lake City, Utah remote trial session commencing on June 6, 2022. On March 28, 2022, respondent filed a Motion for Summary Judgment with supporting exhibits. On April 5, 2022, the Court ordered petitioners to file a response to respondent's Motion for Summary Judgment by April 29, 2022, warning petitioners in that Order that failure to respond might lead to the Court granting respondent's motion. Petitioners did not respond as ordered.
On May 9, 2022, respondent filed a status report. On June 3, 2022, the Court conducted a conference call with respondent and Mr. Schultz. On June 6, 2022, the Court ordered that the case be stricken from the Salt Lake City trial session and continued. By that same order, the Court extended the time for petitioners to respond to the Motion for Summary Judgment to July 19, 2022. Petitioners again failed to respond.
The motion for summary judgment, as supported by the exhibits, demonstrates that petitioners did not dispute their underlying liability during their CDP hearing. See § 6330(c)(2)(B) (allowing taxpayers to contest their underlying liabilities at CDP levy hearings in certain circumstances); see also, § 6320(c) (generally applying the CDP levy hearing provisions of section 6330 to CDP lien hearings). It also demonstrates that petitioners did seek collection alternatives along with lien subordination or withdrawal but that they did not provide requested supporting documentation and were not in compliance with their Federal income tax return filing obligations. See Treas. Reg. §§ 301.6320-1(e)(1) (providing that taxpayers "will be expected to provide all relevant information requested by Appeals, including financial statements, for its consideration of the facts and issues involved in the hearing"); 301.6330-1(e)(1) (same). And finally, it demonstrates that the settlement officer verified that all applicable laws and administrative procedures were satisfied, considered the issues raised by petitioners, and determined that the notice of lien filing and proposed levy balanced the need for the efficient collection of taxes with the concern that the collection actions be no more intrusive than necessary. See §§ 6320(c); 6330(c)(3).
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.
As a result of petitioners' failure to respond, there is no indication in the record of a genuine dispute as to any material fact. Thus, decision may be rendered as a matter of law under Rule 121. Upon due consideration, and for cause, it is
Although petitioners' petition may suggest a change in circumstances after the notice of determination was issued due to the loss of Ms. Paulsen's job, we note that their failure to respond also fails to give any indication that remanding this case for consideration of such a change would be helpful, necessary or productive. Petitioners are still free, however, to attempt to negotiate a new collection alternative with the IRS on this basis. See Kehoe v. Commissioner, T.C. Memo. 2013-63, *15-16.
ORDERED that respondent's Motion for Summary Judgment, filed March 28, 2022, is granted. It is further
ORDERED AND DECIDED that the determination in the Notice of Determination Concerning Collection Actions under IRC Sections 6320 or 6330 of the Internal Revenue Code, dated June 7, 2021, is sustained in full.