Opinion
Taxpayers: KHANTH TUNG LOUNG and CAPITOL FURNITURE
ORDER AND FINDINGS AND RECOMMENDATIONS I.R.S. SUMMONS ENFORCEMENT
KIMBERLY MUELLER, Magistrate Judge.
This matter came on for hearing on September 24, 2008, under the Order to Show Cause filed August 19, 2008, which, with the verified petition and exhibits, was personally served on respondent on September 4, 2008. Caroline A. Newman appeared for petitioners, and Revenue Officer Martha Rodriguez was present on behalf of petitioning Revenue Officer Cynthia Kallich. Respondent did not file an opposition but appeared at the hearing. Respondent requested an interpreter at hearing, but was able to communicate in English sufficiently such that the court was comfortable proceeding, with the understanding that an interpreter would be provided during the appearance ordered below.
The Verified Petition to Enforce Internal Revenue Service Summons initiating this proceeding seeks to enforce two administrative summonses (Exhibit A to the petition) in aid of Revenue Officer Kallich's investigation to determine financial information for the collection of assessed income tax for the taxable year ending December 31, 2005, as well as a second investigation of CAPITOL FURNITURE, to determine financial information for the collection of assessed Employer's Federal Quarterly Tax for the periods ending March 31, 2001, June 30, 2001, September 30, 2001, March 31, 2002, June 30, 2002, September 30, 2002, December 31, 2002, March 31, 2003, June 30, 2003, September 30, 2003, December 31, 2003, September 30, 2006, and December 31, 2006, and for Employer's Annual Unemployment tax for the year ended December 31, 2006. Subject matter jurisdiction is invoked under 28 U.S.C. §§ 1340 and 1345, and is found to be proper. Authorization for the action is under I.R.C. §§ 7402(b) and 7604(a) (26 U.S.C.). The Order to Show Cause shifted to respondent the burden of rebutting any of the four requirements of United States v. Powell , 379 U.S. 48, 57-58 (1964).
Based on the petition and documents in support and the uncontroverted verification of Revenue Officer kallich and the entire record, the court makes the following findings:
(1) The summonses issued by Revenue Officer Cynthia Kallich to respondent Khanh Tung Luong on April 3, 2008, seeking testimony and production of documents and records in respondent's possession, was issued in good faith and for a legitimate purpose under I.R.C. § 7602, that is, to determine financial information for the collection of assessed income tax for the taxable year ending December 31, 2005, and to determine financial information of CAPITOL FURNITURE for the collection of assessed Employer's Federal Quarterly Tax for the periods ending March 31, 2001, June 30, 2001, September 30, 2001, March 31, 2002, June 30, 2002, September 30, 2002, December 31, 2002, March 31, 2003, June 30, 2003, September 30, 2003, December 31, 2003, September 30, 2006, and December 31, 2006, and for Employer's Annual Unemployment tax for the year ended December 31, 2006.
(2) The information sought is relevant to that purpose.
(3) The information sought is not already in the possession of the Internal Revenue Service.
(4) The administrative steps required by the Internal Revenue Code have been followed.
(5) There is no evidence of referral of this case by the Internal Revenue Service to the Department of Justice for criminal prosecution.
(6) The verified petition and its exhibits make a prima facie showing of satisfaction of the requirements of United States v. Powell , 379 U.S. 48, 57-58 (1964).
(7) The burden shifted to respondent, Khanh Tung Luong, to rebut that prima facie showing. (8) Despite respondent's appearance at the hearing, respondent presented no argument or evidence to rebut the prima facie showing.
In light of the above, IT IS HEREBY ORDERED THAT the Clerk shall serve this order and future orders on Mr. Khanh Tung Luong, at 4066 Pine Lake Circle, Stockton, California, 95219.
IT IS HEREBY RECOMMENDED that the IRS summonses issued to respondent, Khanh Tung Luong, be enforced, and that respondent be ordered to appear at the I.R.S. offices at 4643 Quail Lakes Drive, Suite 101, Stockton, California, 95207, before Revenue Officer Cynthia Kallich or Revenue Officer Martha Rodriguez, on October 23, 2008, at 9:00 a.m., then and there to be sworn, to give testimony, and to produce for examining and copying the books, checks, records, papers and other data demanded by the summons, the examination to continue from day to day until completed. A Vietnamese interpreter shall be provided for the respondent at this meeting.
These findings and recommendations are submitted to the United States District Judge assigned to the case, pursuant to the provisions of 28 U.S.C. § 636(b)(1)(B) and (C) and Rule 72-304 of the Local Rules of the United States District Court for the Eastern District of California. Within ten (10) days after being served with these findings and recommendations, any party may file written objections with the court and serve a copy on all parties. Such a document should be titled "Objections to Magistrate Judge's Findings and Recommendations." Any reply to the objections shall be served and filed within ten (10) days after service of the objections. The District Judge will then review these findings and recommendations pursuant to 28 U.S.C. § 636(b)(1). The parties are advised that failure to file objections within the specified time may waive the right to appeal the District Court's order. Martinez v. Ylst , 951 F.2d 1153 (9th Cir. 1991).