                                             T.C. Memo. 2019-27



                                    UNITED STATES TAX COURT



                       MARTIN G. PLOTKIN, Petitioner v.
                COMMISSIONER OF INTERNAL REVENUE, Respondent



         Docket No. 16224-14L.                                             Filed April 4, 2019.



         Martin G. Plotkin, for himself.

         Miriam C. Dillard and Mark J. Tober, for respondent.


                                                    CONTENTS


Background. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

1.       The 1994 assessment of self-reported liabilities for tax years
         1991-93; the 2004 writeoff of the self-reported liabilities
         for tax years 1991-93; the 2012 Tax Court deficiency decision
         for tax years 1991-95; and the 2012 reversal of the 2004
         writeoffs of the self-reported liabilities for tax years 1991-93 . . . . . . . . . . . 5

2.       The intended levy, the collection-review hearing, and the
         collection-review determination for tax years 1991-95. . . . . . . . . . . . . . . . 10
                                                  -2-

[*2] 3.    Procedural history of this case. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

      a.   Pleadings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

      b.   Respondent’s prior summary-judgment motion . . . . . . . . . . . . . . . . 23

      c.   Respondent’s current summary-judgment motion . . . . . . . . . . . . . . 23

      d.   Petitioner’s October 16, 2017 motion for partial
           summary judgment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

      e.   Petitioner’s November 8, 2017 motion for partial
           summary judgment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

      f.   Petitioner’s November 15, 2017 response to respondent’s
           motion for summary judgment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

      g.   Respondent’s February 5, 2018 reply to petitioner’s
           response to respondent’s motion for summary judgment . . . . . . . . . 29

      h.   Respondent’s February 21, 2018 supplement to his
           reply to petitioner’s response to respondent’s motion
           for summary judgment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

      i.   Petitioner’s February 27, 2018 motion for summary
           judgment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

      j.   Petitioner’s March 15, 2018 sur-reply to respondent’s
           February 5, 2018 reply to petitioner’s response to
           respondent’s motion for summary judgment. . . . . . . . . . . . . . . . . . . 34

      k.   Petitioner’s April 2, 2018 supplement to his
           February 27, 2018 motion for summary judgment . . . . . . . . . . . . . . 36

      l.   Respondent’s April 30, 2018 reply to petitioner’s
           February 27, 2018 motion for summary judgment,
           as supplemented . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
                                                          -3-

[*3] Discussion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

1.       Uncollectibility of the self-reported 1991, 1992, and 1993
         tax and related penalties and interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

2.       The Office of Appeals’ failure to address petitioner’s concern
         that proposing a collection alternative would waive his right to
         challenge the underlying tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

3.       Which transcripts the Office of Appeals used for verification . . . . . . . . . . 43

4.       Invalidity of the notice of deficiency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

5.       Section 7485. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

6.       Prohibited communications with the Office of Chief Counsel . . . . . . . . . . 51

7.       Only Social Security income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

8.       Identity theft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

9.       Law-of-the-case doctrine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

10.      Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55


                                       MEMORANDUM OPINION


         MORRISON, Judge: On June 9, 2014, the Internal Revenue Service (IRS)

Office of Appeals determined to sustain a proposed levy to collect income-tax
                                         -4-

[*4] liabilities from petitioner for tax years 1991, 1992, 1993, 1994, and 1995.

Petitioner filed a timely petition. We have jurisdiction under section 6330(d)(1).1

      Both parties have filed motions for summary judgment. Respondent urges

the Court to sustain the determination. Petitioner urges the Court not to sustain

the determination. We sustain the determination except as to collection activity

regarding (a) the self-reported tax (and related additions to tax and interest)

totaling $4,823.18 for 1991, $7,590.38 for 1992, and $2,660.12 for 1993 and (b)

$6,000 of the unreported tax for 1995.

                                     Background

      The following facts are not in dispute. They are derived from the pleadings,

the parties’ motion papers, and the supporting exhibits thereto. There is also an

explanation of the relevant text of the Tax Court and U.S. Court of Appeals

opinions in Plotkin v. Commissioner, T.C. Memo. 2011-260, aff’d, 498 F. App’x

954 (11th Cir. 2012). We take judicial notice of that text to determine what the

respective courts decided. See Fed. R. Evid. 201; see also Estate of Reis v.

Commissioner, 87 T.C. 1016, 1027-1028 (1986).




      1
      Unless otherwise indicated, all references to sections are to the Internal
Revenue Code of 1986, as amended, and all references to Rules are to the Tax
Court Rules of Practice and Procedure.
                                         -5-

[*5] Petitioner was a resident of Florida when he filed his petition in this case.

We follow the opinions of the U.S. Court of Appeals for the circuit which would

be the proper appellate venue. See Golsen v. Commissioner, 54 T.C. 742, 757

(1970), aff’d, 445 F.2d 985 (10th Cir. 1971). The appellate venue in this case,

because the petition was filed before December 18, 2015, is determined by the

rules in section 7482(b) before the amendments by the Consolidated

Appropriations Act, 2016, Pub. L. No. 114-113, sec. 423(a), 129 Stat. at 3123

(2015). We need not determine the proper circuit because it would not affect our

holding.

1.     The 1994 assessment of self-reported liabilities for tax years 1991-93; the
       2004 writeoff of the self-reported liabilities for tax years 1991-93; the 2012
       Tax Court deficiency decision for tax years 1991-95; and the 2012 reversal
       of the 2004 writeoffs of the self-reported liabilities for tax years 1991-93

       In 1994 petitioner filed tax returns reporting the following income-tax

liabilities:

                           Tax year             Tax reported

                             1991                  $2,981
                             1992                   5,157
                             1993                   2,044

       In 1994 respondent assessed these reported tax liabilities as well as related

interest and additions to tax. The dates of assessment were as follows: October 3,
                                       -6-

[*6] 1994, for the 1991 tax year; November 14, 1994, for the 1992 tax year; and

October 10, 1994, for the 1993 tax year. The amounts assessed are set forth in the

table below:

                                                     Fees and
                    Late-   Late- Estimated            other
         Self-      filing payment   tax             expenses
 Tax reported addition addition addition                 for
 year tax liability to tax  to tax  to tax  Interest collection            Total

 1991       $2,981 $670.73 $447.15   ---            $719.80    $4.50    $4,823.18
 1992        5,157 1,160.33 352.83 $144.46           775.76     ---      7,590.38
 1993        2,044 459.90    61.32   ---              94.90      ---     2,660.12

Respondent had 10 years from the dates of assessment to collect these amounts.

See sec. 6502(a)(1).

        In 2004 the various 10-year periods ended without respondent’s having

collected any of the assessed amounts. Respondent made writeoff entries in his

records to reflect that the assessments for 1991, 1992, and 1993 were uncollectible

because the 10-year periods had ended. The amounts of the liabilities recorded as

uncollectible were $4,823.18 for 1991, $7,590.38 for 1992, and $2,660.12 for

1993.
                                        -7-

[*7] On April 22, 2008, respondent mailed petitioner a notice of deficiency for

tax years 1991, 1992, 1993, 1994, and 1995.2 The notice of deficiency showed

that respondent had determined the following deficiencies, additions to tax, and

penalties:

                                        Additions to tax                    Penalty
Tax year Deficiency Sec. 6651(f)       Sec. 6651(a)(2) Sec. 6654          Sec. 6663(a)

  1991       $108,652       ---              ---               ---        $78,447.75
  1992         61,885       ---              ---               ---         46,413.75
  1993         52,397       ---              ---               ---         39,297.75
  1994         45,490   $32,980.25       $11,372.50        $2,343.73          ---
  1995        320,852   232,617.70           80,213        17,515.76          ---

      In 2008 petitioner filed a timely petition with the Tax Court for

redetermination of the amounts determined in the notice of deficiency as

deficiencies, additions to tax, and penalties. The Tax Court assigned docket No.

17775-08 to this deficiency case.

      On November 3, 2011, the Tax Court issued a Memorandum Opinion in the

deficiency case. Plotkin v. Commissioner, T.C. Memo. 2011-260. Among other

things, the Tax Court found that petitioner was not a partner in the limited

partnership Rolla Health Care Associates, L.P. (Rolla). Id., slip. op. at 4-6.


      2
       Before respondent can assess a deficiency, which is generally an amount of
tax imposed greater than that reported on a taxpayer’s return, he must first mail the
taxpayer a notice of deficiency. Secs. 6211(a), 6212(a), 6213(a).
                                         -8-

[*8] On January 27, 2012, the Tax Court entered a decision in the deficiency

case in the following amounts:

                                 Additions to tax                        Penalty
Tax year Deficiency Sec. 6651(f) Sec. 6651(a)(2)          Sec. 6654    Sec. 6663(a)

  1991      $108,652            ---            ---            ---      $78,447.75
  1992        61,885            ---            ---            ---       46,413.75
  1993        52,397            ---            ---            ---       39,297.75
  1994        45,490        $32,980.25         ---        $2,343.73        ---
  1995        66,031            ---            ---         3,604.75        ---

The amounts of the Court’s decision were the same as the amounts determined in

the notice of deficiency except that (1) the deficiency amount for 1995 was less,

(2) the amount of the section 6654 addition to tax for 1995 was less, (3) no section

6651(a)(2) addition to tax was sustained for 1994 or 1995, and (4) no section

6651(f) addition to tax was sustained for 1995.

       On February 1, 2012, petitioner filed a notice of appeal with the Tax Court

in his deficiency case. He did not file an appeal bond.

       On March 5, 2012, respondent assessed the deficiencies, additions to tax,

and penalties redetermined by the Tax Court in the deficiency case. However,

because of a typographical error, the amount assessed as a deficiency for 1995 was

$60,031 instead of $66,031. Respondent does not seek to correct this error, which

is in petitioner’s favor.
                                         -9-

[*9] Also on March 5, 2012, respondent reversed his 2004 writeoffs of the 1991,

1992, and 1993 liabilities related to petitioner’s self-reported tax for those years,

including interest and additions to tax. Thus, according to respondent’s records

after this reinstatement of the liabilities, the following amounts were still

collectible: $4,823.18 for 1991, $7,590.38 for 1992, and $2,660.12 for 1993.

      On November 27, 2012, the U.S. Court of Appeals for the Eleventh Circuit

issued an opinion affirming the decision of the Tax Court in the deficiency case.

Plotkin v. Commissioner, 498 F. App’x 954 (No. 12-10620). The opinion stated

that on appeal petitioner had argued for the first time that the Tax Court did not

have jurisdiction because he was a partner in Rolla and no partnership-level

proceeding had been conducted. Id. at 961 n.4. The opinion stated that the Court

of Appeals rejected the argument because, among other reasons, the Tax Court had

found that he was not a partner in Rolla. Id.

      On February 11, 2013, the following notation was added to respondent’s

narrative-history record for petitioner’s 1992 tax year:

      TC340 interest computation dated 03/05/2012 erroneously includes
      accruals on $7,590.38 deficiency with a CSED [Collection Statute
      Expiration Date] that expired 11/14/2004; interest/penalty accruals on
      expired CSED deficiencies should not be assessed because those
      amounts cannot be collected. The same issue exists for tax years
      1991 and 1993.
                                        - 10 -

[*10] Petitioner contends that this entry suggests that its author thought the March

5, 2012 reversal of the writeoffs of self-reported tax (and related penalties and

interest) for 1991, 1992, and 1993 was improper. Respondent now concedes that

the March 5, 2012 reversal of the writeoffs for 1991, and 1992, 1993 was

improper.

      On February 22, 2013, petitioner filed a petition for certiorari with the U.S.

Supreme Court. On April 15, 2013, the U.S. Supreme Court denied the certiorari

petition. Plotkin v. Commissioner, 569 U.S. 933 (2013).

      On May 9, 2013, petitioner filed a petition for rehearing of the U.S.

Supreme Court’s denial of his certiorari petition. On June 10, 2013, the U.S.

Supreme Court denied petitioner’s motion for rehearing. Plotkin v.

Commissioner, 569 U.S. 1040 (Mem.).

2.    The intended levy, the collection-review hearing, and the collection-review
      determination for tax years 1991-95

      On July 29, 2013, respondent issued a notice of intent to levy and notice of

right to a hearing to petitioner. The notice of intent to levy stated that respondent

intended to levy to collect the following amounts:
                                          - 11 -

[*11]          Tax    Unpaid from prior        Add’l      Add’l      Amount you
Form No.       year       notices             penalty    interest      owe

  1040      1991        $732,197.89             ---        ---       $732,197.89
  1040      1992         406,641.23         $11,397.14     ---        418,038.37
  1040      1993         312,357.85             ---        ---        312,357.85
  1040      1994         242,576.49             ---        ---        242,576.49
  1040      1995         171,260.68             ---        ---        171,260.68
                                                                    1,876,431.28

Respondent does not dispute that the amounts listed above include the writeoffs

that were reversed on March 5, 2012, i.e., $4,823.18 for 1991, $7,590.38 for 1992,

and $2,660.12 for 1993.

      On August 27, 2013, petitioner mailed respondent a request for a collection-

review hearing. The request was made on a preprinted form prepared by the IRS

that had various boxes for the taxpayer to check to indicate the reason the taxpayer

disagreed with the levy. Petitioner left blank the three boxes under the category

“Collection Alternative”. (These three boxes were labeled “Installment

Agreement”, “Offer in Compromise”, and “I cannot pay balance”.) Petitioner also

left blank a box for innocent-spouse relief, which was outside the category

“Collection Alternative”. Instead, petitioner checked a box labeled “Other”,

which was outside the category “Collection Alternative”. He wrote the following

explanation:
                                       - 12 -

[*12] Notice invalid and amounts shown incorrect[.] The requirements of
      the tax laws and administrative procedures as to actions the IRS must
      take prior to sending a notice of intent to levy or notice of levy have
      not been met[.] Therefore, the notice is invalid and the amounts
      shown are incorrect and inapplicable.

      On September 13, 2013, respondent issued a notice of levy to Medigroup

Westwinds Park, Inc., stating that the levy was to collect petitioner’s income-tax

liabilities for 1991, 1992, 1993, 1994, and 1995. The record does not reveal what

the Medigroup Westwinds Park, Inc., was or its relationship to petitioner. As

discussed infra, this notice of levy was premature and was later released.

      On September 17, 2013, respondent sent petitioner a letter acknowledging

that he had received petitioner’s August 27, 2013 request for a collection-review

hearing and that he had referred the case to the IRS Office of Appeals. The letter

requested that petitioner fill out a Form 433-A, Collection Information Statement

for Wage Earners and Self-Employed Individuals, and bring a copy of the form

with him to his collection-review hearing.

      On October 29, 2013, the Office of Appeals sent petitioner a letter

informing him that his case had been assigned to its “Fresno Campus--Butler

Appeals Office”. The Office of Appeals assigned Settlement Officer Valerie

Chavez to handle the case.
                                        - 13 -

[*13] On November 14, 2013, Settlement Officer Chavez made the following

notation in the record of respondent known as the “case activity record”: “I rcvd

email from RO [Revenue Officer] Chad Adams stating that he issued a levy on tp

without realizing tp had a CDP filed. He has issued a levy release.” The reference

to the “levy” was to the September 13, 2013 notice of levy sent to Medigroup

Westwinds Park, Inc. The term “CDP filed” apparently referred to petitioner’s

August 27, 2013 request for a collection-review hearing, also known as a

“collection due process”, or CDP, hearing. The entry indicates that the levy notice

to Medigroup Westwinds Parks, Inc., had been released.

      On November 15, 2013, Settlement Officer Chavez made the following

notation in the case activity record:

      DPLV 30-1991, 1992, 1993, 1994, 1995. No poa on file per cfink or
      case file.

      Compliance check- tp in full compliance per imfoli, only income ssi
      and not required to file. Earliest csed 03-05-22/susp.

      Research of our IDRS/ACS transcripts have found that all legal and
      administrative requirements for the action taken have been met;
      verified by review of Txmods.[3] Assessment was properly made per

      3
        IDRS, or Integrated Data Retrieval System, is essentially an electronic
interface between the IRS’s employees and its various computer systems. See
Crow v. Commissioner, T.C. Memo. 2002-149, slip op. at 11 n.6. Transcripts are
obtained by entering various command codes (e.g., TXMODA, SUMRY, IMFOLI,
                                                                       (continued...)
                                        - 14 -

[*14] IRC Section 6201 for each tax and period listed on the CDP Notice.
      The notice and demand for payment was properly mailed to the
      taxpayer’s last known address, within 60 days of the assessment, as
      required by IRC Section 6303. There was a balance due when the
      CDP levy notice was issued or when the NFTL filing was requested.
      The collection period allowed by statute to collect to collect [sic]
      these taxes has been suspended by the appropriate computer codes for
      the tax periods at issue. No pending bankruptcy during appeals or at
      the time the CDP notice was issued (11 U.S.C. § 362(a)(6)). Verified
      UAL letter and Pub 4165 sent to TP/Poa.

      Liability issue trying to be raised. TP argues that the requirements of
      the law and admin procedures taken prior to issuing Intent to Levy
      notice have not been met; therefore, the notice is invalid and the
      amounts are incorrect. TP goes on to explain that this issue is still
      presently on Appeal at the 11th Circuit Court of Appeals #12-10620
      and no decison [sic] has been made. I tried looking up this court
      number but didnt find his name listed.

      I did however find #17775-08(1991-1995). This was a large file and
      had a lot of reading. TP disputed assessments as well as SNOD
      delivery and validity. The courts deemed all assessments valid.
      Prints are in the case file. As such, tp is precluded from raising this
      issue in the CDP. We are not going to re-hash this out again.

      I verified on Tax Court Decision that the assessment amounts and
      penalties were correct; howevr [sic], the only difference i see is that
      irs assessed fraud penalty which wsnt on the tax court decisin [sic],
      but TP was indicted of fraud and was sentenced.


      3
       (...continued)
ENMOD, BMFOLI, TXMODS, and CFINK) into IDRS to obtain a particular
transcript. See May v. Commissioner, T.C. Memo. 2014-194, at *12 n.6, aff’d sub
nom. Best v. Commissioner, 702 F. App’x 615 (9th Cir. 2017). ACS is the
acronym for Automated Collection System. Hampton Software Dev., LLC v.
Commissioner, T.C. Memo. 2018-87, at *15.
                                        - 15 -

[*15] TP was involved with fraud for 91-93 and indicted for under
      reporting and not reporting income. TP was an attorney at one time,
      also involved with multiple bzns entities. Bcz of fraud, there is no
      statute on ASED, and since involved with SFR, no statute on ASED
      per tax court docs.

      IRPTRL 2009, 2010, 2011 shows tp only rcvs SSI of $15,958.00. No
      other income. TP isnt required to file 2007 thru 2012. TP is 71 yrs
      old, and court docs ordered that all responses to tp be in Arial 14pt
      print. TP must have trouble reading small print?[4]

      Currently the account has open -L freeze, open TC520 cc72(tax
      court).

      ACTION: while open court, cant proceed on collections. Need to get
      assistance on researching the tax court number tp is citing bcz i was
      unable to find on us tax court. Suspend case.

As shown in the notes quoted above, Settlement Officer Chavez thought that

petitioner alleged that his 1991-95 tax liabilities were still being considered by the

U.S. Court of Appeals for the Eleventh Circuit. The record does not clarify when

petitioner made this allegation to Settlement Officer Chavez.

      On December 16, 2013, Settlement Officer Chavez wrote an email seeking

advice from Attorney Gordon Sanz of the Office of Chief Counsel. Chavez asked


      4
       In a March 2009 court paper filed in petitioner’s deficiency case at docket
No. 17775-08, petitioner advised the Court that his eyesight was severely
impaired. The Tax Court started serving copies of its orders on petitioner in Arial
14-point bold print. In this collection-review case, too, petitioner has advised the
Court that he has reading difficulties. The Court has made allowances in this case
similar to those it made in the deficiency case.
                                        - 16 -

[*16] Sanz whether she should suspend the collection-review hearing “while TP

has appealed in the 11th Circuit Court of Appeals and no decision has been made.”

Sanz responded: “It looks like you have some discretion. You could go ahead

and proceed, if they did not file a bond, or, you could administratively suspend the

case.”

         On December 19, 2013, Settlement Officer Chavez wrote a letter to

petitioner scheduling a telephone conference on February 6, 2014, to discuss the

reasons petitioner disagreed with the collection action (i.e., the proposed levy).

The letter advised petitioner that the Office of Appeals would not “entertain any

argument pertaining to the validity of the assessment or the underlying liability”

because the Tax Court had decided “that the assessments are valid and correct.”

The letter stated that for the Office of Appeals “to consider alternative collection

methods such as currently not collectible, installment agreement or offer in

compromise, you must provide” a complete collection-information statement by

January 17, 2014.

         On January 16, 2014, petitioner wrote to Settlement Officer Chavez

requesting “a copy” of the assessments that the Tax Court had determined to be

valid and correct.
                                       - 17 -

[*17] On January 28, 2014, petitioner wrote to Settlement Officer Chavez asking

for the February 6, 2014 telephone conference to be postponed because a throat

condition made it difficult for him to speak.

       On February 6, 2014, Settlement Officer Chavez wrote to petitioner

acknowledging that she had received his letters dated January 16 and 28. In her

letter Chavez rescheduled the telephone conference from February 6 to March 6,

2014. However, Chavez’s letter explained that if petitioner were unable to

participate in the conference because of a physical inability to speak, she would

hold the collection-review hearing entirely through correspondence. The letter

asked petitioner to submit any further correspondence by March 6, 2014. The

letter also stated:

       The Court Decision records state that the assessments were
       procedurally correct and the Statutory Notice of Deficiency letters
       were properly mailed to you; therefore, you are precluded from
       raising these issues in the CDP arena. We can however, consider a
       collection alternative for you. You will need to provide a complete
       Form 433-A, Collection Information Statement by March 6, 2014.

       On March 1, 2014, petitioner wrote a letter to Settlement Officer Chavez.

The letter stated in part:

       Further, the applicable statutes and section of the Internal Revenue
       Code provide that until the Tax Court decision becomes final, no
       assessment or collection activity can be undertaken by respondent.
       According to the U.S. Court of Appeals for the 11th Circuit, a
                                        - 18 -

[*18] decision by the Tax Court does not become final until all permissible
      appeals have either been decided or abandoned.

      On or before April 3, 2014, the Office of Appeals reassigned petitioner’s

collection-review case from Settlement Officer Chavez to Settlement Officer Lora

Davis.

      On April 14, 2014, Settlement Officer Davis wrote in the case activity

record: “Reviewed TXMOD transcripts to verify the IRS met all applicable

requirements of law & administrative procedures in issuing the CPD notice.” She

also wrote: “Transcripts printed for case file.”

      On April 15, 2014, Attorney Ellen Friberg of respondent’s Office of Chief

Counsel faxed Settlement Officer Davis a copy of the U.S. Court of Appeal’s

November 27, 2012 opinion.

      On April 28, 2014, Settlement Officer Davis wrote to petitioner to explain

that she had been assigned his case. The letter stated that she would not consider

the validity of the assessments or the amounts of liability for tax deficiencies for

years 1991 through 1995 because the U.S. Court of Appeals had decided the

deficiency case for these years against petitioner. The letter stated that if

petitioner were interested in a collection alternative for the balances due he should
                                         - 19 -

[*19] provide a collection-information statement (i.e., a Form 433-A). Settlement

Officer Davis also stated:

      For Currently Not Collectable (CNC)/Hardship Status--If you do not
      have the ability to make a payment at this time and would like
      consideration of hardship status, please advise.

In her letter Settlement Officer Davis asked that the items she had requested in that

letter be sent to her by May 22, 2014, and stated that she could not consider

collection alternatives “without this information”. The letter enclosed records of

respondent dated April 28, 2014, with the heading “Account Transcript” for each

respective tax year from 1991 to 1995.

      On March 6, 2014, the date appointed for the telephone conference,

Settlement Officer Davis telephoned petitioner but was unable to reach him.

      On May 17, 2014, petitioner wrote a letter to Settlement Officer Davis. The

letter stated that petitioner wished to present issues to Settlement Officer Davis but

could not until he received “copies of assessments” he had previously requested of

Settlement Officer Chavez. The letter then said:

      As for the forms you enclosed which set out various collection
      alternatives, until I receive the information I have requested and have
      had and a full and fair opportunity to present to you the legal issues I
      believe affect any levy action, I feel any such request is premature
      and might act as a waiver of the issues I wish to present[.]
                                           - 20 -

[*20] On June 4, 2014, Settlement Officer Davis made the following entry in the

case activity record:

      Received letter back from Tp without the requested financial
      information statement; TP is delaying the collection process and
      concerns that are addressed are not concrete issues; the liabilities
      have been through the courts and appealed at the 11th circuit which
      was sustained; TP does not have the ability to raise liability on the
      balances due and has not provided income information for a
      resolution. Review of the income information to see if Tp would be
      deemed hardship IRP reflects SS income only; however TRDBV
      (return transcript) for 2013 reflects dividends in the amount of
      28510.00 SS incoem [sic] 17180.00; review of this reflects that TP
      may have an ability to make payment toward the balances due. To
      issue determination letter to TP.

      On June 9, 2014, the Office of Appeals issued a determination sustaining

the proposed levy to collect petitioner’s income-tax liabilities for the five tax years

1991, 1992, 1993, 1994, and 1995. The notice of determination stated:

      a.     Verification of legal and procedural requirements:

      The requirements of applicable law or administrative procedures have been met
      and the actions taken were appropriate under the circumstances.

      !      We verified through transcript analysis that assessments were made on the
             applicable CDP notice period per IRC § 6201 and the notice and demand
             for payment letter was mailed to your last known address, within 60 days
             of the assessment, as required by IRC § 6303.

      !      There was a balance due when the CDP notice was issued per IRC §§
             6330 and 6331(a). There is still a balance due.

      !      IRC § 6330(a) imposes the requirement that a taxpayer be given an
             opportunity for hearing before the Internal Revenue Service can levy on
             the taxpayer’s property.
                                           - 21 -

[*21] !      We verified posting of TC 520 for the correct date on the period listed on
             the CDP hearing request, per review of computer transcripts which means
             the levy action has been suspended and the collection period allowed by
             statute to collect these taxes has been suspended by the appropriate
             computer codes for the tax periods at issue.

      !      There is no offer-in-compromise or installment agreement pending or
             currently in effect. There is also no pending innocent spouse request.

      !      There is no pending bankruptcy case, nor did you have a pending
             bankruptcy case at the time the CDP notice was sent * * *.

The determination stated: “Due to your prior opportunity to raise liability before

US Tax Court and the 11th Circuit, you were denied the ability to raise liability

before CDP Appeals the liability stands as determined by the courts.” The

determination stated that the Office of Appeals had requested on December 19,

2013, February 6, 2014, and April 28, 2014, that petitioner submit a Form 433-A

(i.e., a collection-information statement) but that as of June 4, 2014, the Office had

not received the form and that therefore petitioner was not eligible to be

considered for a collection alternative. The notice also stated:

      We balanced the competing interests in finding the proposed levy
      appropriate. As discussed above, the assessments at issue are valid.
      Given your failure to provide us with the requested forms to explore
      collection alternatives, the proposed levy balances the need for
      efficient collection with your concern that any collection action be no
      more intrusive than necessary. The Notice of intent to Levy is
      sustained.

The determination also stated: “You did not cooperate in the determination to

enforce collection; therefore, the case will be returned to the Compliance
                                         - 22 -

[*22] Department for the appropriate actions. The Notice of Intent to Levy action

is sustained.”

3.    Procedural history of this case

      a.     Pleadings

      In July 2014 petitioner filed his Tax Court petition for review of the June 9,

2014 determination of the Office of Appeals. The petition (and an amendment to

the petition) contained this statement: “The Tax Court decision had not become

final on or before March 5, 2012 and the assessments made on that date are

invalid.” In response, respondent’s answer (and his answer to the amendment to

the petition) stated: “Denies, except admits that the Tax Court’s decision had not

become final by March 5, 2012.” The petition (and an amendment to petition)

contained this statement: “The Notice of Determination also omitted any

reference to Petitioner’s position that the Tax Court lacked jurisdiction to entertain

the deficiency notice case and that the decision in that case is, therefore, a nullity.”

In response, respondent’s answer (and his answer to the amendment to the

petition) stated:

             Denies. Alleges that the notice of determination refers to the
      opinion in which the Eleventh Circuit Court of Appeals affirmed the
      opinion of the Tax Court. Further alleges that in the opinion the
      Eleventh Circuit explicitly rejected the argument petitioner mentions
      in this paragraph.
                                       - 23 -

[*23] b.    Respondent’s prior summary-judgment motion

      On October 8, 2015, respondent moved for summary judgment. The only

documents attached to the motion for summary judgment were (1) the June 9,

2014 notice of determination and (2) Forms 4340 for tax years 1991-95. The

Forms 4340 are dated August 5, 2014. A Form 4340 is an IRS record entitled

“Certificate of Assessments, Payments, and Other Specified Matters”. The type of

information in a Form 4340 generally overlaps with the type of information in

another IRS record entitled “Account Transcript” except that an “Account

Transcript” contains some information about correspondence between the IRS and

the taxpayer not found in a Form 4340.

      On December 1, 2015, the Court denied respondent’s October 8, 2015

motion for summary judgment.

      c.    Respondent’s current summary-judgment motion

      On October 12, 2017, respondent again moved for summary judgment.

      Attached to this motion for summary judgment were Forms 4340 for tax

years 1991-95. These Forms 4340 are dated August 2, 2017.

      Accompanying the motion for summary judgment was a declaration by

Settlement Officer Davis stating that she had maintained the “administrative file”

for the collection-review hearing by the Office of Appeals and that the
                                        - 24 -

[*24] administrative file included exhibits C through VV attached to the

declaration. Exhibits I, K, L, V, and OO are potentially relevant to the issues

raised by the parties.

      Exhibit I was described in the declaration as “Various IDRS Transcripts

printed from September 17, 2013 through June 4, 2014.”5 The documents in

exhibit I are filled with codes and do not have any plain-language page headings.

The dates of the documents in exhibit I are September 17, 2013; December 19,

2013; April 14, 2014; and June 4, 2014. (As noted before, records indicate that

Settlement Officer Davis printed “transcripts” on April 14, 2014.) Some of the

documents in exhibit I either are undated or have no apparent date.

      Exhibit K was described in the declaration as “Page titled Mandatory

Review required, dated October 21, 2013.”

      Exhibit L was described in the declaration as “Case Summary Cards dated

October 18, 2013, October 29, 2013, March 31, 2014, and June 4, 2014.”

      Exhibit V was described in the declaration as a “19-page document” that

“contains, among other items, correspondence between petitioner and respondent.”

Exhibit V includes several pages of IRS records that are filled with codes.




      5
          See supra note 3 for the meaning of IDRS.
                                         - 25 -

[*25] Exhibit OO is the April 28, 2014 letter from Settlement Officer Davis to

petitioner. Attached to the letter are respondent’s records with the heading

“Account Transcript”, dated April 28, 2014, for each tax year from 1991-95.

      Respondent’s motion for summary judgment asserted that the Office of

Appeals had verified that the requirements of applicable law and administrative

procedure had been met. To support this assertion, the motion cited exhibit I, the

IDRS transcripts. The motion also cited the November 15, 2013 case activity

record where Settlement Officer Chavez had written that she had verified that all

legal and administrative requirements had been met through her research of

“IDRS/ACS transcripts” and “Txmods”. Thus we take the motion to suggest that

the IDRS transcripts in exhibit I are what the Office of Appeals used to conduct its

verification.

      The motion further argued that the proposition that the verification was

made was “supported” by the Forms 4340, dated August 2, 2017, although the

motion expressly conceded that the Office of Appeals did not actually consult

Forms 4340.

      d.        Petitioner’s October 16, 2017 motion for partial summary judgment

      On October 16, 2017, petitioner moved for partial summary judgment. His

motion rested on two theories: first, there should have been a two-stage procedure
                                        - 26 -

[*26] for handling the collection-review hearing; and second, his only current

income was from Social Security. We describe each of these arguments below.

      Two-stage procedure. Petitioner contended that the Office of Appeals erred

by failing to respond to his letter of May 17, 2014, in which he had suggested that

requesting a collection alternative would waive his opportunity to challenge the

validity of the assessments. In effect, petitioner argued that the Office of Appeals

erred by failing to divide the collection-review hearing into two stages. The first

stage would address the validity of the assessments. The second stage would

address collection alternatives.

      Only Social Security income. Petitioner contended that the Office of

Appeals had obtained information that indicated that his financial situation was

such that it was impossible to collect any significant portion of the liabilities. This

was apparently a reference to the following notation made by Settlement Officer

Chavez on November 15, 2013: “IRPTRL 2009, 2010, 2011 shows tp only rcvs

SSI of $15,958.00. No other income, TP isn’t required to file 2007 thru 2012.”

      e.     Petitioner’s November 8, 2017 motion for partial summary judgment

      On November 8, 2017, petitioner again moved for partial summary

judgment. This motion was amended on November 13, 2017. The motion stated

that the February 11, 2013 notation in respondent’s narrative-history record for
                                       - 27 -

[*27] petitioner’s 1992 tax year showed that the “assessment” made on March 5,

2012, was incorrect. Although the motion literally asserted that the “assessment”

made on March 5, 2012, was incorrect,6 it was actually the assessments made in

1994 that became uncollectible because of the expiration of the 10-year periods

for collecting assessments. These amounts were written off by respondent in

2004, but the writeoffs were reinstated in 2012. Therefore, we interpret

petitioner’s argument to be that the March 5, 2012 reinstatement of the 1994

assessments was incorrect because of the expiration of the collection periods.

      f.    Petitioner’s November 15, 2017 response to respondent’s motion for
            summary judgment

      On November 15, 2017, petitioner filed a response to respondent’s motion

for summary judgment. We summarize his arguments below:

      Law of the case. Petitioner argued that the same facts presented in

respondent’s second motion for summary judgment were presented in

respondent’s first motion for summary judgment. Therefore, petitioner argued, the

second motion for summary judgment must be denied under the law-of-the-case

doctrine.


      6
       The motion stated: “The IRS itself determined that the assessments made
on March 5, 2012 * * * were incorrect; therefore the Notice of Intent to Levy is
invalid.”
                                        - 28 -

[*28] Expiration of collection period. Petitioner again argued that the March 5,

2012 reversals of the prior writeoffs were incorrect. He had made this argument

previously in his November 8, 2017 motion for partial summary judgment.

      Section 7485. Petitioner argued that section 7485 is a defense to the claim

in his petition that the assessments were premature and therefore respondent

waived the provisions of section 7485 by failing to refer to them in his answer.

      Ex parte communications. Petitioner argued that the emails between

Settlement Officer Chavez and Office of Chief Counsel Attorney Gordon Sanz

were impermissible ex parte communications.

      Two-stage procedure. Petitioner again argued that the Office of Appeals

erred by failing to address his concern that proposing a collection alternative

would waive his right to contest the underlying tax liability.

      Only Social Security income. Petitioner argued that the Office of Appeals

erred in concluding the balancing test of section 6330(c)(3)(C) was met because it

had determined that petitioner’s income consisted solely of Social Security

benefits.

      Which transcripts. Petitioner argued that the record does not show what

transcripts the Office of Appeals relied on to verify that the requirements of any

applicable law or administrative procedure have been met. Petitioner asserts that
                                       - 29 -

[*29] the court papers contain multiple IRS records that could have been the

records that the Office of Appeals consulted to perform the verification: (1) the

IDRS transcripts attached as exhibit I to the declaration by Settlement Officer

Davis, (2) exhibit K attached to the Davis declaration, (3) exhibit V attached to the

Davis declaration, and (4) the documents headed “Account Transcript” in exhibit

OO attached to the Davis declaration. Petitioner contends that the Court should

disregard the Forms 4340 because they were printed after the determination of the

Office of Appeals.

      Invalidity of notice of deficiency. Petitioner argued that the Tax Court in

the deficiency case did not have jurisdiction to redetermine his deficiencies

because the notice of deficiency was invalid, having been mailed without there

having been a partnership-level proceeding related to Rolla, in which he claimed

he was a partner.

      g.     Respondent’s February 5, 2018 reply to petitioner’s response to
             respondent’s motion for summary judgment

      On February 5, 2018, respondent filed a reply to petitioner’s response to

respondent’s motion for summary judgment. Respondent’s views are summarized

below.
                                        - 30 -

[*30] Law-of-the-case doctrine. Respondent argued that the law-of-the-case

doctrine does not require the Court to deny his motion for summary judgment

because the first motion for summary judgment was not accompanied by a

declaration of the Appeals officer and because the previous motion was not denied

with prejudice.

      Expiration of collection period. Respondent admitted that he erred when on

March 5, 2012, he reversed the writeoffs of the liabilities that he had entered in his

records in 2004. Respondent asserted that his counsel had contacted Settlement

Officer Davis to request that the reinstated amounts be abated, that the abatements

should show up in petitioner’s accounts in two weeks, and that respondent would

be willing to file a court paper accompanied by “account transcripts” once the

abatements had been posted. However, respondent stated that this

“acknowledgment and correction of that error does not change respondent’s

determination that the assessments made per the Tax Court decision are valid, that

summary judgment is appropriate, and that collection via levy should be

sustained.”

      Section 7485. Respondent argued that section 7485 did not stay the

assessment of the amounts in the Tax Court’s decision because petitioner did not
                                        - 31 -

[*31] post an appeal bond. Respondent argued that he was not required to discuss

section 7485 in his answer.

      Ex parte communication. Respondent argued that it was permissible for

Settlement Officer Chavez to seek advice from the Office of Chief Counsel.

      Two-stage procedure. Respondent argued that it was not an abuse of

discretion for the Office of Appeals to not respond to petitioner’s concern that

submitting financial information for consideration of a collection alternative

would prevent him from challenging the underlying assessments.

      Only Social Security income. Respondent argued that the Office of Appeals

did not abuse its discretion in finding that the balancing test weighs in favor of

sustaining collection because, even though the case activity report reflected that

payor information showed petitioner received only Social Security income,

Settlement Officer Davis’s June 4, 2014 case activity record states that she

reviewed transcripts showing additional income and thus that petitioner “may have

an ability to make payment toward the balances due”. Furthermore, respondent

argued that the Office of Appeals did not abuse its discretion in resolving the

balancing test in favor of levy because petitioner did not submit financial

information.
                                        - 32 -

[*32] Which transcripts. Respondent explained that in support of his motion for

summary judgment, dated October 12, 2017, he had attached a declaration from

Settlement Officer Davis stating that she had maintained the administrative file for

the collection-review hearing; that part of this administrative file was exhibit I,

described as “Various IDRS Transcripts printed from September 17, 2013 through

June 4, 2014”; that the June 9, 2014 notice of determination stated that she had

verified the assessments “through transcript analysis”; and that in the April 14,

2014 case activity record she had stated that she had reviewed “TXMOD

transcripts”. Respondent conceded that Settlement Officer Davis had failed to

notice the erroneous reinstatement of the previously written-off balances of

$4,823.18, $7,590.38, and $2,660.12, for tax years 1991, 1992, and 1993,

respectively, and that counsel for respondent was in the process of having the

erroneous reinstatements reversed. Respondent reiterated the argument made in

his motion for summary judgment that the existence of information in the Forms

4340 confirms that Settlement Officer Davis must have made the necessary

verifications through transcript analysis.

      Invalidity of notice of deficiency. Respondent argued that petitioner’s

contention that the Tax Court did not have jurisdiction over his deficiency case

had been rejected by the Court of Appeals for the Eleventh Circuit.
                                        - 33 -

[*33] h.     Respondent’s February 21, 2018 supplement to his reply to
             petitioner’s response to respondent’s motion for summary judgment

      On February 21, 2018, respondent filed a supplement to his reply to

petitioner’s response to respondent’s motion for summary judgment. To this

supplement respondent attached, for tax years 1991, 1992, and 1993, his record

with the heading “Account Transcript” showing that he had abated, on February

19, 2018, the amounts related to the self-reported tax liabilities for 1991, 1992,

and 1993. These abated amounts were $10,284.65, $16,111.43, and $5,668.18,

respectively. The abated amount for each year is greater than the reinstated

amount for each year. This is because interest had accrued on the reinstated

amounts. These documents with the heading “Account Transcript” are dated

February 20, 2018.

      i.     Petitioner’s February 27, 2018 motion for summary judgment

      On February 27, 2018, petitioner filed a motion for summary judgment. In

the motion petitioner stated that, because respondent had admitted that the

reversals of writeoffs on March 5, 2012, were improper, the Office of Appeals had

failed to “verify that all legal and administrative requirements have been met”.
                                        - 34 -

[*34] j.     Petitioner’s March 15, 2018 sur-reply to respondent’s February 5,
             2018 reply to petitioner’s response to respondent’s motion for
             summary judgment

      On March 15, 2018, petitioner filed a sur-reply to respondent’s February 5,

2018 reply to petitioner’s response to respondent’s motion for summary judgment.

In this court paper, petitioner put forward his views regarding the statements in

respondent’s reply to the response.

      Law of the case. Petitioner argued that although respondent’s pending

motion for summary judgment was accompanied by a declaration of Settlement

Officer Davis (and attached documents), and although respondent’s first motion

for summary judgment was not accompanied by such a declaration (and attached

documents), respondent had the documents available to him when he filed his first

motion for summary judgment.

      Expiration of collection period. With respect to the writeoffs that were

reversed in 2012, petitioner argued that the process of assessment was

“approximate and arbitrary” and that the Court should reject respondent’s attempt

to prove he abated the reinstated amount through “a newly fabricated transcript.”

This was apparently a reference to the documents with the heading “Account

Transcript”, dated February 20, 2018.
                                        - 35 -

[*35] Section 7485. Petitioner argued that respondent “cannot provide any court

decisions actually discussing a procedure to be followed for the posting of such a

bond.” Petitioner argued that respondent was required to plead his section 7485

argument in his answer under Rule 39, which requires a party to “set forth in the

party’s pleading any matter constituting an avoidance or affirmative defense,

including res judicata, collateral estoppel, estoppel, waiver, duress, fraud, and the

statute of limitations”, because the issue of posting a bond is analogous to a statute

of limitations.

      Ex parte communication. With respect to the issue of whether Settlement

Officer Chavez’s exchange of emails with Chief Counsel Attorney Sanz was

prohibited ex parte communication, petitioner argued that Sanz’s advice was given

“in a hurried and off-hand manner” and therefore was not consistent with “the

applicable IRS procedure.”

      Identity theft. Petitioner attached to this court paper four pages of IRS

records. These four pages appear to be identical to pages 27, 28, 29, and 31 of

exhibit I attached to the declaration of Settlement Officer Davis. The four pages

of records refer to a Form 1040A for tax year 2011 filed by a “taxpayer” named

Martin Plotkin with an address in Lakeland, Florida. (Petitioner’s actual address

is in Tavaras, Florida.) The four pages of records contain a $28,510 entry for
                                       - 36 -

[*36] “ORDINARY DIVIDEND AMOUNT”, a $17,180 entry for “SOCIAL

SECURITY BENEFIT AMOUNT”, and a $9,999 entry for “T BAL DUE OR

REFUND AMOUNT”. Petitioner contended that these four pages of records

demonstrate that someone had filed a false return with respondent in petitioner’s

name reporting that he had Social Security benefits of $17,180 and dividends of

$28,510 and was owed a refund of $9,999 and that respondent paid $9,999 to the

person who filed the false return. Petitioner argued that Settlement Officer Davis

abused her discretion by failing to question him about this return.

      k.     Petitioner’s April 2, 2018 supplement to his February 27, 2018
             motion for summary judgment

      On April 2, 2018, petitioner filed a supplement to his February 27, 2018

motion for summary judgment. In this supplement, he amended his motion for

summary judgment to include his argument about identity theft, i.e., that the Office

of Appeals abused its discretion by failing to question him about the identity-theft

return.

      l.     Respondent’s April 30, 2018 reply to petitioner’s February 27, 2018
             motion for summary judgment, as supplemented

      On April 30, 2018, respondent filed a reply to petitioner’s February 27,

2018 motion for summary judgment, as supplemented.
                                        - 37 -

[*37] Expiration of collection period. With respect to the erroneous reversals of

the writeoffs, respondent again stated, as he had in his February 5, 2018 court

paper, that his error did not “change respondent’s determination that the

assessments made per the Tax Court decision are valid, that summary judgment is

appropriate, and the collection via levy should be sustained.” Respondent

contended that in Everett Assocs., Inc. v. Commissioner, T.C. Memo. 2012-143,

the Court sustained collection activities with respect to some assessments but not

others. Furthermore, respondent contended that it would be unnecessary and

unproductive to remand the case to the Office of Appeals.

      Identity theft. With respect to petitioner’s identity-theft allegation,

respondent contended that respondent eventually realized there was a possibility

the refund claim was due to identity theft and did not issue the $9,999 refund.

Furthermore, respondent contended that even if Settlement Officer Davis had

questioned petitioner about the return submitted for 2011 and realized that it was

an identity-theft attempt, such a realization would not have changed her

determination that petitioner was not eligible for a collection alternative because

he had failed to submit the requested financial-information statement. Respondent

did not dispute that someone submitted an identity-theft return for tax year 2011

under petitioner’s name. It appears that the information from the identity-theft
                                         - 38 -

[*38] return was reflected in respondent’s records and that the June 4, 2014 entry

in the case activity record made by Settlement Officer Davis shows that she

viewed these records and erroneously concluded that the information

corresponded to a genuine return filed by petitioner for tax year 2013. Respondent

did not dispute that this is so.

                                       Discussion

      Before respondent can levy to collect a tax liability, he must notify the

taxpayer of a right to a collection-review hearing with the IRS Office of Appeals.

Sec. 6330(a)(1), (b)(1). The hearing, and the Office of Appeals’ determination

following the hearing, are governed by section 6330. Section 6330(c) provides:

            SEC. 6330(c). Matters Considered at Hearing.--In the case of
      any hearing conducted under this section--

                    (1) Requirement of investigation.--The appeals officer
             shall at the hearing obtain verification from the Secretary [of
             the Treasury] that the requirements of any applicable law or
             administrative procedure have been met.

                    (2) Issues at hearing.--

                          (A) In general.--The person may raise at the
                    hearing any relevant issue relating to the unpaid tax or
                    the proposed levy, including--

                                   (i) appropriate spousal defenses;
                                        - 39 -

[*39]                             (ii) challenges to the appropriateness of
                           collection actions; and

                                  (iii) offers of collection alternatives, which
                           may include the posting of a bond, the substitution
                           of other assets, an installment agreement, or an
                           offer-in-compromise.

                         (B) Underlying liability.--The person may also
                    raise at the hearing challenges to the existence or amount
                    of the underlying tax liability for any tax period if the
                    person did not receive any statutory notice of deficiency
                    for such tax liability or did not otherwise have an
                    opportunity to dispute such tax liability.

                    (3) Basis for the determination.--The determination by
              an appeals officer under this subsection shall take into
              consideration--

                           (A) the verification presented under paragraph (1);

                           (B) the issues raised under paragraph (2); and

                           (C) whether any proposed collection action
                    balances the need for the efficient collection of taxes
                    with the legitimate concern of the person that any
                    collection action be no more intrusive than necessary.

Once the Office of Appeals has made the determination referred to by section

6330(c)(3), a taxpayer can petition the Tax Court for review of the determination.

Sec. 6330(d)(1).

        Where the existence or amount of the underlying tax liability is properly at

issue, we review the determination de novo. Goza v. Commissioner, 114 T.C.
                                        - 40 -

[*40] 176, 181-182 (2000). Where the existence or amount of the underlying tax

liability is not properly at issue, we review the determination for abuse of

discretion. Id. at 182.

      Petitioner has made his arguments against sustaining the June 9, 2014

determination of the Office of Appeals in his court papers that address the parties’

cross-motions for summary judgment. Respondent has made his arguments in

favor of sustaining the determination in his court papers that address the parties’

cross-motions for summary judgment. A motion for summary judgment will be

granted only if it is shown that there is no genuine dispute as to any material fact

and that a decision may be rendered as a matter of law. See Rule 121(b). As we

explain below, there are no genuine disputes as to any facts that are material to the

question of whether to sustain the determination. As a matter of law the

determination is partly sustained and partly not sustained. See infra Discussion

part 10.

1.    Uncollectibility of the self-reported 1991, 1992, and 1993 tax and related
      penalties and interest

      In 1994 respondent assessed the tax reported on petitioner’s 1991, 1992,

and 1993 returns, along with related penalties and interest. In 2004 the 10-year

periods for collecting these assessed amounts expired. See sec. 6502(a)(1). On
                                         - 41 -

[*41] March 5, 2012, respondent erroneously recorded these amounts as

collectible by reversing a prior writeoff. In July 2013 respondent issued a notice

of intent to levy to collect these and other amounts. In June 2014 the IRS Office

of Appeals sustained the proposed levy in its notice of determination. Petitioner

contends that the notice of determination should not be sustained because the

Office of Appeals did not recognize that respondent had reversed the writeoffs of

the self-reported tax and related penalties and interest on March 5, 2012, even

though the 10-year periods for collecting these amounts, see sec. 6502(a)(1), had

expired.

      Addressing this issue, respondent now concedes that it was error to reverse

the writeoffs of the assessments of these liabilities. He also concedes that the

Office of Appeals failed to ascertain that the periods for collection had closed on

these self-reported tax liabilities (and related interest and penalties) for 1991,

1992, and 1993. Thus, respondent has effectively conceded that petitioner is no

longer liable for these amounts. As explained infra Discussion part 10, we do not

sustain the proposed levy to the extent of these amounts.
                                         - 42 -

[*42] 2.     The Office of Appeals’ failure to address petitioner’s concern that
             proposing a collection alternative would waive his right to challenge
             the underlying tax liabilities

      Petitioner also contends that the Office of Appeals erred by failing to

address his concern that by proposing a collection alternative he would waive his

right to contest his underlying tax liabilities. In his letter of May 17, 2014,

petitioner told the Office of Appeals that its request for a collection-information

statement (a statement the Office of Appeals sought in order to evaluate

petitioner’s eligibility for collection alternatives) was “premature” until petitioner

had an “opportunity” to present “legal issues.” Essentially, petitioner’s letter

proposed that the Office of Appeals adopt a two-stage process under which, first,

the office would consider and resolve any dispute about the existence or amount of

the underlying tax liabilities; and second, the office would consider collection

alternatives. Section 6330 does not require such a process. Even assuming for the

purpose of argument that such a two-stage process was required under section

6330, the failure of the Office of Appeals to implement such a two-stage process

would be at most a harmless error. See Perkins v. Commissioner, 129 T.C. 58, 71

(2007). This is because dividing the hearing into two stages would not have made

a difference to the ultimate determination of the Office of Appeals in this case. On

April 28, 2014, the Office of Appeals wrote petitioner that it would not consider
                                        - 43 -

[*43] his challenges to the amounts or existence of his tax liabilities. Petitioner

knew from this letter that the Office of Appeals would not consider his challenges

to the amounts or existence of his tax liabilities. But petitioner refused to submit

his collection-information statement. Nor did he request a collection alternative,

such as an offer-in-compromise or an installment agreement. Nor did he submit

any specific offer or propose any specific terms. Thus, even had the Office of

Appeals adopted a two-stage process for considering the issues it was required to

consider under section 6330(c), the outcome would have been the same. Without

the collection-information statement, the Office of Appeals would not have

considered any collection alternatives.7 And this would not have been an error.

See Ashmore v. Commissioner, T.C. Memo. 2017-233, at *18-*19 (finding no

error for Office of Appeals to refuse to consider collection alternatives after

taxpayer failed to submit collection-information statement); see also Huntress v.

Commissioner, T.C. Memo. 2009-161, slip op. at 12-13 (holding Office of

Appeals did not abuse its discretion in failing to agree to an offer-in-compromise

when taxpayer did not make offer-in-compromise or submit Form 433-A). There

was no prejudice in the way the Office of Appeals handled petitioner’s concern.

      7
        On December 19, 2013, Settlement Officer Chavez wrote a letter to
petitioner stating that for the Office of Appeals to consider collection alternatives,
he had to provide a collection-information statement.
                                        - 44 -

[*44] 3.     Which transcripts the Office of Appeals used for verification

      Settlement Officer Davis’s case-activity-record entry on April 14, 2014

stated that she had reviewed “TXMOD transcripts” to verify that all requirements

of applicable law and administrative procedure had been met. The notice of

determination, dated June 9, 2014, stated that the requirements of applicable law

and administrative procedure had been met. In his October 12, 2017 motion for

summary judgment, respondent observed that Settlement Officer Davis’s

declaration stated that among the items in the administrative file were exhibit I

(described by Davis as various IDRS transcripts printed from September 17, 2013,

through June 4, 2014). Thus the motion implied that Settlement Officer Davis

relied on the IDRS transcripts in exhibit I to conduct the verification. Petitioner

contended that it is unclear which records the Office of Appeals relied on to verify

that the requirements of applicable law and procedure were met. (Pet’r’s Resp.

Mot. Summ. J., paras. 34-40, Nov. 15, 2017). He observed that there were other

documents besides exhibit I attached to Settlement Officer Davis’s declaration that

she said were part of the administrative file. Therefore, petitioner contended,

some of these other documents could have been the documents that Settlement

Officer Davis relied on in conducting the verification. Petitioner in particular

referred to the following documents: exhibits I, K, V, and OO. (It is possible
                                        - 45 -

[*45] petitioner meant to refer to exhibit L rather than exhibit K.) Petitioner

observed that Forms 4340 were attached to respondent’s prior and current motions

for summary judgment. However, petitioner contended that the Court should

disregard the Forms 4340 because they were printed after the determination of the

Office of Appeals.

      We are satisfied that the Office of Appeals performed the necessary

verification. The Forms 4340 reflect information that was in the IRS computer

systems when the Office of Appeals conducted the verification. See Bowman v.

Commissioner, T.C. Memo. 2007-114, slip op. at 15-17, aff’d, 285 F. App’x 309

(8th Cir. 2008). One requirement that must be verified--where, as in this case,

respondent seeks to collect an amount of tax greater than that reported--is that a

valid notice of deficiency was mailed. Sec. 6211(a) (defining a deficiency

generally as the amount by which the actual tax liability exceeds the reported tax

liability); sec. 6213(a) (prohibiting the assessment of a deficiency before the

mailing of the notice of deficiency); sec. 6212(a) (authorizing respondent to send a

notice of deficiency if he determines there is a deficiency in income tax); Jordan v.

Commissioner, 134 T.C. 1, 12 (2010), supplemented by T.C. Memo. 2011-243.

The Forms 4340 show that respondent mailed a notice of deficiency to petitioner,

a fact that is corroborated by the opinion in the deficiency case. Plotkin v.
                                        - 46 -

[*46] Commissioner, slip op. at 19. Petitioner challenges the validity of the notice

of deficiency, but we reject that challenge as we explain infra Discussion part 4.

Another problem petitioner avers is that the Office of Appeals failed to verify that

the 10-year period for collecting the assessments of the self-reported liabilities had

not expired. As explained infra Discussion part 10, we do not sustain the levy to

the extent of the self-reported liabilities. Because of the information in the Forms

4340, and because petitioner has not identified any other particular requirement of

applicable law or administrative procedure that has not been met, we hold that the

Office of Appeals did not abuse its discretion in performing the verification

mandated by section 6330(c)(1).

4.    Invalidity of the notice of deficiency

      Petitioner contends that the notice of deficiency is invalid because no

partnership-level proceeding was conducted before the notice was mailed. But

petitioner made the same argument to the U.S. Court of Appeals, which rejected it.

Plotkin v. Commissioner, 498 F. App’x at 960 n.4. He is barred by the doctrine of

collateral estoppel from raising the issue again. See Peck v. Commissioner, 90

T.C. 162, 166-167, aff’d, 904 F.2d 525 (9th Cir. 1990). And even if he were not

barred, his theory fails on the merits. The pleadings and other materials do not
                                         - 47 -

[*47] show there is a genuine dispute of fact about whether Plotkin was a partner

in Rolla. See Rule 121(b).

5.    Section 7485

      Section 6213(a) bars respondent from assessing a deficiency until he has

mailed a notice of deficiency to the taxpayer and the 90-day period for filing a Tax

Court petition has expired, or, if the taxpayer files a petition, until the decision of

the Tax Court has become final. The date that a Tax Court decision becomes final

depends on whether the party who lost the Tax Court case exercises the right of

appeal provided by section 7483. Under section 7483, the party who loses a Tax

Court case has 90 days to appeal the Tax Court decision to the U.S. Court of

Appeals by filing a notice of appeal. If the losing party does not appeal within 90

days, then the Tax Court’s decision becomes final. Sec. 7481(a)(1). If the losing

party timely appeals the Tax Court decision, then the decision becomes final only

when the appellate litigation is concluded. Sec. 7481(a)(2), (3), and (4). To take

an example that mirrors the procedural history of petitioner’s appeal of his

deficiency case, suppose: (1) an appeal of a Tax Court decision is timely filed,

(2) the U.S. Court of Appeals affirms the Tax Court decision, (3) the appellant

files a certiorari petition with the U.S. Supreme Court, and (4) the certiorari
                                        - 48 -

[*48] petition is denied. In that circumstance the Tax Court decision becomes

final when the certiorari petition is denied. Sec. 7481(a)(2)(B).

      The rule in section 6213(a) is subject to an exception found in section 7485.

See Kovacevich v. Commissioner, T.C. Memo. 2009-160, slip op. at 6-7 n.4.

Section 7485(a) provides:

             SEC. 7485(a). Upon Notice of Appeal.--Notwithstanding any
      provision of law imposing restrictions on the assessment and
      collection of deficiencies, the review under section 7483 [i.e.,
      appellate review of the Tax Court’s decision] shall not operate as a
      stay of assessment or collection of any portion of the amount of the
      deficiency determined by the Tax Court unless a notice of appeal in
      respect of such portion is duly filed by the taxpayer, and then only if
      the taxpayer--

                    (1) on or before the time his notice of appeal is filed has
             filed with the Tax Court a bond in a sum fixed by the Tax
             Court not exceeding double the amount of the portion of the
             deficiency in respect of which the notice of appeal is filed, and
             with surety approved by the Tax Court, conditioned upon the
             payment of the deficiency as finally determined, together with
             any interest, additional amounts, or additions to the tax
             provided for by law, or

                    (2) has filed a jeopardy bond under the income or estate
             tax laws.

      If as a result of a waiver of the restrictions on the assessment and
      collection of a deficiency any part of the amount determined by the
      Tax Court is paid after the filing of the appeal bond, such bond shall,
      at the request of the taxpayer, be proportionately reduced.
                                        - 49 -

[*49] What section 7485 means is that appellate review stays assessment only if

the taxpayer files an appeal bond. Rule 192; United States v. Evans, 340 F. App’x

990, 994 (5th Cir. 2009). Thus, when the taxpayer does not file an appeal bond,

respondent may make the assessment even pending appellate review. Kahn v.

United States, 590 F.2d 48, 49 (2d Cir. 1978); Burke v. Commissioner, 124 T.C.

189, 191 n.4 (2005); Barnes Theatre Ticket Serv., Inc. v. Commissioner, 50 T.C.

28, 29 (1968), aff’d sub nom. Barnes v. Commissioner, 408 F.2d 65 (7th Cir.

1969). The appeal bond must be filed on or before the date the notice of appeal is

filed. Sec. 7485(a)(1). The bond must be in a sum fixed by the Tax Court. Id. A

taxpayer who wishes the Tax Court to fix an amount of the bond can file a motion

requesting it to do so. See Poinier v. Commissioner, 90 T.C. 63, 67 (1988)

(denying taxpayer’s motion to fix bond at amount requested; fixing bond at higher

amount); Barnes Theater Ticket Serv., Inc. v. Commissioner, 50 T.C. at 28-29

(same). Alternatively a taxpayer can file motion asking the Tax Court to accept a

particular bond. See, e.g., Armstrong v. Commissioner, 99 T.C. 506, 507, 510-511

(1992) (granting motion to accept taxpayer’s bond where taxpayer submitted a

bond, and filed a motion to accept the bond, when he filed notice of appeal).

      In 2008 respondent issued the notice of deficiency to petitioner. The same

year, petitioner filed the petition in the deficiency case. On January 27, 2012, the
                                        - 50 -

[*50] Tax Court entered the decision in the deficiency case. On February 1, 2012,

petitioner filed a notice of appeal. But he did not file a bond. Nor did he file a

motion for the Tax Court to fix the amount of the bond or accept a particular bond.

On March 5, 2012, respondent assessed the amounts redetermined in the Tax

Court case. On April 15, 2013, the Supreme Court denied the certiorari petition.

Thus, on that day, the Tax Court decision in the deficiency case became final. See

sec. 7481(a)(2)(B). Respondent contends that he was permitted to make the

March 5, 2012 assessment even though the Tax Court decision did not become

final until April 15, 2013. For authority, respondent cites section 7485.

      Petitioner contends, however, that assessment of the deficiencies was stayed

under section 7485 because the Tax Court never fixed the amount of the bond. He

posits that when the Tax Court does not fix the amount of a bond, no bond is

required of a taxpayer under section 7485. Petitioner reads section 7485 as if it

provided that the taxpayer need not file a bond if the Tax Court has not fixed the

amount of the bond. But section 7485 contains no such provision. It requires the

taxpayer to file a bond with the Tax Court in order for appellate review to operate

as a stay on the assessment. Otherwise, appellate review does not operate as a stay

on the assessment. Petitioner did not file a bond. Therefore the review of the Tax
                                        - 51 -

[*51] Court’s decision by the Court of Appeals did not operate to stay the

assessment of the amounts decided by the Tax Court.

      Finally, petitioner contends that respondent is barred from arguing that

petitioner failed to file a bond under section 7485 because respondent did not

make this argument in his answer. Rule 39 requires a party to set forth any matter

constituting an affirmative defense in a pleading. Petitioner has supplied no

authority for the proposition that his failure to file a bond is an affirmative defense

in this context.

6.    Prohibited communications with the Office of Chief Counsel

      Petitioner contends that the Office of Appeals engaged in a prohibited

communication with the Office of Chief Counsel. Settlement Officer Chavez, the

first Appeals officer assigned to petitioner’s collection-review case, sought advice

from the Office of Chief Counsel on whether the collection-review case should be

suspended while the U.S. Court of Appeals considered petitioner’s appeal of his

deficiency case. The Office of Chief Counsel told Settlement Officer Chavez that

the matter was within her discretion.

      These communications were not improper. In the Internal Revenue Service

Restructuring and Reform Act of 1998, Pub. L. No. 105-206, sec. 1001(a)(4), 112

Stat. at 689, Congress directed respondent to develop a plan to restrict ex parte
                                       - 52 -

[*52] communications between employees of the Office of Appeals and other

employees. In accordance with the congressional direction, respondent issued

Rev. Proc. 2000-43, 2000-2 C.B. 404, which was superseded by Rev. Proc. 2012-

18, 2012-10 I.R.B. 455. Rev. Proc. 2012-18, sec. 2.06(1), 2012-10 I.R.B. at 462,

expressly allows the Office of Appeals to obtain legal advice from the Office of

Chief Counsel.

      The communications between Settlement Officer Chavez and the Office of

Chief Counsel are communications involving legal advice permitted by Rev. Proc.

2012-18, supra. These communications do not provide a predicate for us to hold

that the Office of Appeals erred. Cf. Drake v. Commissioner, 125 T.C. 201, 210

(2005) (remanding to Office of Appeals and determining Office of Appeals abused

discretion when it received communication from IRS Insolvency Unit prohibited

by Rev. Proc. 2000-43, 2000-2 C.B. 404), supplemented by T.C. Memo. 2006-

151, aff’d, 511 F.3d 65 (1st Cir. 2007).

7.    Only Social Security income

      Petitioner argues that the Office of Appeals erred in concluding that the

proposed levy balanced the need for the efficient collection of tax with his

legitimate concern that any collection be no more intrusive than necessary. In

support of his argument petitioner contends: “Respondent has acknowledged that
                                       - 53 -

[*53] Appeals’ review of IRS records showed Petitioner’s only income for 2007-

2012 was social security”. This is a reference to the following entry made by

Settlement Officer Chavez in the case activity record on November 15, 2013:

“IRPTRL 2009, 2010, 2011 shows tp only rcvs SSI of $15,958.00. No other

income. TP isnt required to file 2007 through 2012.”

      Had petitioner wished to convince the Office of Appeals that his income

consisted only of Social Security benefits, he could have given the Office of

Appeals a collection-information statement. This statement, properly filled out,

would have contained information on petitioner’s current income, including the

sources and amount. In the absence of this form, the Office of Appeals did not err

in determining that the balancing test of section 6330(c)(3)(C) was satisfied. See

Hawthorne v. Commissioner, T.C. Memo. 2015-148, at *6. Although Settlement

Officer Davis apparently assumed that the identity-theft return for 2011 was a

genuine return and that the return reflected that petitioner earned dividend income,

this error was harmless. The analysis of the balancing in the notice of

determination hinged on petitioner’s failure to submit the collection-information

statement, not on his supposed dividend income.
                                        - 54 -

[*54] 8.        Identity theft

       Petitioner contends that the Office of Appeals erred by making its

determination without contacting petitioner and otherwise investigating a false

return filed in petitioner’s name as part of an identity-theft scam involving a

$9,999 refund claim.

       We agree with respondent’s argument that the identity-theft return for 2011

did not affect the Office of Appeals’ determination to sustain the proposed

collection action because petitioner did not submit financial information. The

Office of Appeals would have sustained the levy even had there been no identity-

theft return.

9.     Law-of-the-case doctrine

       Petitioner claims that because the Court denied respondent’s prior motion

for summary judgment filed on October 8, 2015, the Court is barred by the law-of-

the-case doctrine from granting respondent’s current motion for summary

judgment filed October 12, 2017. We disagree. A motion for summary judgment

is evaluated by reference to the papers accompanying the motion. Rule 121(b) and

(c). The current motion for summary judgment was accompanied by papers

substantially different from those accompanying the prior motion for summary

judgment. The law-of-the-case doctrine does not preclude us from granting the
                                        - 55 -

[*55] current motion for summary judgment merely because we denied the prior

one. See Jackson v. Ala. State Tenure Comm’n, 405 F.3d 1276, 1283 (11th Cir.

2005); Williamsburg Wax Museum v. Historic Figures, Inc., 810 F.2d 243, 251

(D.C. Cir. 1987).

10.   Conclusion

      As explained before, in 1994 respondent assessed self-reported tax (and

related penalties and interest) for tax year 1991, 1992, and 1993; in 2004 the

periods for collecting these amounts expired; in 2012 respondent erroneously

reversed his writeoff of these self-reported liabilities; in July 2013 respondent

issued a notice of intent to levy to collect these and other amounts; and in June

2014 the Office of Appeals sustained this collection action.

      Petitioner contends that because respondent erroneously reinstated his self-

reported tax liabilities (and related penalties and interest) for 1991, 1992, and

1993 (and because respondent sought to collect these reinstated amounts by levy),

the Tax Court should not sustain respondent’s collection activity regarding any of

the unpaid liabilities that respondent seeks to collect by levy. However, when the

Tax Court determines that a portion of the tax liability sought to be collected is not

owed by the taxpayer, it is appropriate for the Court to sustain the collection

activity as it applies to the liability that is owed. This proposition is supported by
                                         - 56 -

[*56] Everett Assocs., Inc. v. Commissioner, T.C. Memo. 2012-143. In November

2001 Everett Associates, a corporation, filed for bankruptcy. Id. at 2-3.

Respondent filed a proof of claim regarding (1) a secured claim, (2) an unsecured

priority claim, and (3) an unsecured general claim. Id. at 3. In February 2003 the

bankruptcy court confirmed a chapter 11 plan. Id. at 4. In March 2005 the

bankruptcy case was closed. Id. at 4-5. In November 2006 respondent issued a

notice of intent to levy to the corporation for various unpaid tax liabilities. Id.

at 6. The unpaid tax liabilities included the claims for which respondent had

submitted a proof of claim. Id. at 21-22. The unpaid tax liabilities also included

(1) postconfirmation interest on respondent’s unsecured priority claim, id. at 33,

and (2) penalties that accrued during the pendency of the bankruptcy case, id. at

58-59. The Office of Appeals sustained the notice of intent to levy. Id. at 9. The

Tax Court, reviewing the Office of Appeals’ determination to sustain the proposed

levy, held that respondent was entitled to payment of the liabilities reflected in the

proof of claim. Id. at 22, 28, 31. However, the Court held that respondent was not

entitled to payment of postconfirmation interest on his unsecured priority claim

and postpetition penalties. Id. at 48, 61. At the conclusion of its opinion, the Tax

Court did not sustain collection activity regarding postconfirmation interest on

respondent’s unsecured priority claim or the penalties that accrued during the
                                        - 57 -

[*57] pendency of the bankruptcy case. Id. at 61. However, it sustained the

collection activity regarding the liabilities asserted in respondent’s proof of claim.

Id.

      By analogy, the uncollectibility of a portion of the liabilities respondent

sought to collect from petitioner does not mean that the collection activity is

defective as to the entire liability. We sustain respondent’s collection activity with

the exception of collection activity regarding the following liabilities that

respondent concedes: (1) the self-reported tax liabilities (and related interest and

additions to tax) for 1991, 1992, and 1993 and (2) the liability for the deficiency

for 1995 in the amount of $6,000 (the difference between $66,031 and $60,031).

      Petitioner’s October 16, 2017 motion for partial summary judgment will be

denied, his February 27, 2018 motion for summary judgment will be granted in

part and denied in part, and his November 8, 2017 motion for partial summary

judgment will be denied as moot. Respondent’s October 12, 2017 motion for

summary judgment will be granted in part and denied in part.

      To reflect the foregoing,


                                                       An appropriate order and

                                                 decision will be entered.
