                               T.C. Memo. 2015-11



                         UNITED STATES TAX COURT



                GINA BRASHER LANGLEY, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



      Docket No. 17267-13L.                         Filed January 13, 2015.



      Gina Brasher Langley, pro se.

      Clint J. Locke, for respondent.



                           MEMORANDUM OPINION


      COHEN, Judge: This case was commenced under section 6330(d) in

response to a notice of determination concerning collection action sustaining a

proposed levy to collect petitioner’s unpaid Federal income tax liabilities for 2006,

2008, 2009, and 2010. Because of inconsistencies and misstatements in the

administrative record, the case was remanded for a supplemental notice of
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[*2] determination. The supplemental notice acknowledged that there are no

outstanding balances for 2008 and 2010 but sustained the proposed levy to collect

unpaid balances for 2006 ($121.48 as of the date of the original proposal for levy)

and 2009 ($3,374.96 as of the date of the original proposal for levy). The issues

for determination are whether underlying liabilities are properly in issue or

whether the determination to sustain the proposed levy was an abuse of discretion.

All section references are to the Internal Revenue Code in effect at all relevant

times.

                                       Background

         All of the facts in this case are discerned from the underlying administrative

record and the records of this Court. The parties did not execute a stipulation, and

there was no testimony when the case was called for trial. Because the positions

of the parties and the relevant facts are fully disclosed in the administrative record

and the parties’ filings, there is no reason to reopen the record for additional

evidence.

Petitioner’s Claimed Overpayments

         Petitioner was a resident of Florida at the time she filed her petition. She

was previously married to Barney Langley and filed a joint Federal income tax

return with him for 2004. Thereafter she and Barney Langley were divorced as a
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[*3] result of proceedings in the Florida courts. The returns that petitioner filed

for 2006 through 2010 were not joint returns.

      Petitioner contends that she does not owe taxes for the years in issue and

that she is entitled to a refund of over $40,000 for 2004 that was misappropriated

by Barney Langley and/or others in Florida. She has claimed mistreatment by

Florida attorneys and the Florida courts in relation to the domestic relations

proceedings.

      Petitioner filed an action in this Court, docket No. 27396-12, seeking relief

under section 6015 for years 2004 through 2010. That case was ultimately

dismissed for lack of jurisdiction because there was no deficiency for 2004 and

because petitioner had not filed joint returns for the later years.

      On April 15, 2014, petitioner submitted to the Internal Revenue Service

(IRS) amended returns for years including 2010 and a carryback/carryforward

claim for 2010; those documents asserted a theft loss exceeding $400,000.

Petitioner understood that she filed the amended 2010 return “the last day to take

the loss” (because of the period of limitations). Her claimed loss was identified as

including the failure of the IRS to investigate a situation in Florida that she had

pursued in three appeals, including to the Florida Supreme Court. Her amended

returns were referred to an IRS office not part of its Office of Appeals (Appeals
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[*4] Office). Petitioner was requested to provide additional documents, including

“computational statements for the carryback/carryforward years (2008, 2009,

2011, and 2012)” by September 2, 2014. She was specifically advised:

      You must complete the enclosed Schedule A-NOL to compute the
      loss available to carryback. You must complete the enclosed
      Schedule B-NOL showing the computation of the carryover amounts
      from 2008 to 2009 and 2011. You must complete the enclosed NOL
      carryover worksheet to compute the remaining carryover amount to
      2012.

      You must resubmit newly signed corrected claims for 2008, 2009,
      2011 and 2012 with all of the information listed above attached to
      each separate claim. These claims must be received no later than
      September 2, 2014 or they may be disallowed due the expiration of
      the statute of limitations.

Section 6330 Proceedings

      Upon receipt of notice that the IRS intended to levy to collect unpaid

balances for 2006, 2008, 2009 and 2010, petitioner requested a hearing under

section 6330. She argued to the settlement officer assigned to her case that she

was not liable for the balances because she was entitled to relief under section

6015 as a result of financial injuries done to her by her former husband and others

in Florida. She requested that the IRS pursue assets wrongfully withheld from her

in Florida.
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[*5] After numerous exchanges with petitioner, on June 25, 2013, the settlement

officer issued a notice of determination sustaining the proposed levy. The notice

was based in part on the Appeals representative’s erroneous conclusions that the

section 6015 claim had been decided against petitioner by the Court, when in fact

the only thing that had happened by that time in docket No. 27396-12 was that

respondent had filed an answer to the petition.

      Respondent filed a motion for summary judgment that was denied because

of misstatements in the moving papers and in the administrative record. When the

case was called for trial, the Court ordered a remand for an independent Appeals

representative “to review the facts relevant to this case, to provide petitioner with

an accounting of the payments applied and refunds made from 2004 through 2010,

and to issue a supplemental notice of determination that corrects the prior errors

and accurately states the reasons for the determination made”. In the order

remanding the case, however, we explained:

             There are, however, certain obstacles to the relief that
      petitioner seeks, and her misunderstandings contribute to the
      unsatisfactory state of the record. Neither respondent nor the Court
      can remedy petitioner’s concerns with what occurred in her domestic
      case in Florida or what funds are in the hands of persons over whom
      the Court does not have jurisdiction. Her persistence in seeking
      inappropriate remedies has diverted attention from the primary issue,
      which is whether she qualifies for a collection alternative to the
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      [*6] proposed levy in issue. To secure such an alternative, she is
      required to cooperate in providing relevant financial information.

The order included the following paragraph:

            ORDERED that petitioner shall cooperate with the new
      Appeals representative and provide financial information in the
      format requested by that representative, without expecting or
      demanding curative action with respect to funds allegedly held by
      persons not parties to this case.

      Over a period of several months, the Appeals representative handling the

remand reviewed petitioner’s accounts and provided her with copies of refund

checks that had been issued, including the refund for 2004 issued to petitioner and

Barney Langley and allegedly wrongfully converted by him and/or others in

Florida and a small refund for 2006 that she claims not to have received. The

Appeals representative checked the status of petitioner’s amended returns. The

Appeals representative updated petitioner’s account and concluded that no balance

was owing for 2008 or 2010. However, because petitioner offered no collection

alternatives but insisted that she owed nothing and was entitled to refunds

resulting from the 2004 overpayment, the Appeals representative sustained the

proposed levy with respect to 2006 and 2009. The supplemental notice of

determination dated November 20, 2014, explained:
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      [*7] Summary of Determination

      Appeals’ determination is that the Notice of Intent to Levy is
      sustained. At this time there is no longer a balance due on tax years
      2008 and 2010. However, there is still a balance on tax years 2006
      and 2009. You filed an amended 2010 tax return on April 15, 2014
      exceeding $400,000 for losses from a casualty. You were contacted
      by the Service to supply computational statements for the
      carryback/carry forward years (2008, 2009, 2011 and 2012) by
      September 2, 2014. The Service disallowed the claims as untimely
      when you did not respond by September 2, 2014. Appeals cannot
      confirm when the computational statements were supplied but has
      determined your claim for 2010 is without merit. A casualty loss
      cannot be claimed for property lost due to foreclosure or as a result of
      divorce. You have previously stated you were not willing to pay the
      liabilities since you feel you do not owe this money. Under these
      circumstances we can only sustain the Notice of Intent to Levy by the
      Collection Division, finding it necessary and no more intrusive than
      necessary.

                                     Discussion

      Section 6330 provides for notice and an opportunity for a hearing before a

levy proposed by the IRS to collect unpaid taxes may proceed. Under section

6330(c)(2)(A), a taxpayer may raise any relevant issue at a hearing, including

“challenges to the appropriateness of collection actions”, and may make “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.” A taxpayer

is expected to provide all relevant information requested by the Appeals Office for

its consideration of the facts and issues involved in the hearing. See sec.
                                         -8-

[*8] 301.6330-1(e)(1), Proced. & Admin. Regs. Where there is no dispute as to

the underlying liabilities properly before the Court, we review the actions of the

Appeals Office for abuse of discretion. See Swanson v. Commissioner, 121 T.C.

111, 119 (2003). Abuse of discretion may be found if action is arbitrary,

capricious, or without sound basis in fact or law. Giamelli v. Commissioner, 129

T.C. 107, 111 (2007); Woodral v. Commissioner, 112 T.C. 19, 23 (1999).

      Petitioner disputes her underlying liabilities. Her disputes, however, are not

based upon the original liabilities for 2006 and 2009, the years remaining in

dispute. She contests the liabilities on the basis of her erroneous view that she is

entitled to refunds from the IRS going back approximately 10 years because of a

refund on a joint return for 2004 and other property converted by her former

spouse and/or those acting with him. Her claim for relief was most recently stated

as a request that the Court order “(1) Respondent refund to Petitioner $48,323.70

of tax overpayment plus interest for years 2004 to 2010 as petitioned in this cause

and (2) Order Barney Langley be removed from the title to my home that he gave

up his interest in, on Sept 22, 2004 so that Petitioner can reduce vs increase the

loss incurred / Petitioner is incurring on that former marital asset going forward to

2014”. Petitioner has been advised repeatedly that the Court cannot grant the

relief that she seeks. Her demands of action by the IRS and her claims of ultimate
                                         -9-

[*9] financial loss as a result of that agency’s failure to intervene in her Florida

disputes are simply unreasonable.

      During the course of this case and the related case, petitioner has directed

her anger and frustration at respondent and has made multiple and repetitious

motions for sanctions against respondent. The Court has noted and responded to

the errors and inconsistencies in the record and ordered that they be corrected by

the remand process. Petitioner’s amended 2010 return and the claimed carryback

occurred after the initial hearing, but the status of them was considered during the

remand. They are not properly before the Court. To the extent that the origin and

nature of the claimed losses can be determined, they appear to be the result of

petitioner’s unreasonable expectations and demands with respect to her

dissatisfaction with judicial proceedings in Florida.

      The Appeals representative handling the remand complied with our order by

explaining petitioner’s account, updating it, and stating the reasons to sustain the

proposed levy for the years for which unpaid balances remained. She was not

required to accept at face value petitioner’s claims of over $400,000 in theft losses

for 2010 or the carryback of those losses to 2006 and 2009, the only years now in

issue here. The determination of the Appeals representative that the claim for 2010

is without merit is not unreasonable. So far as the record reflects, petitioner’s
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[*10] claims have been decided against her by the Florida courts with jurisdiction

over her and Barney Langley and other involved third parties. Neither the section

6330 procedure nor this Court is the proper forum for reaching a contrary result.

      We cannot conclude that the determination to sustain the levy to collect

unpaid balances shown on petitioner’s account for 2006 and 2009 was arbitrary,

capricious, or without sound basis in fact or law. Whether we consider the

underlying liabilities de novo or review the determination to sustain the proposed

levy for abuse of discretion, petitioner is not entitled to the relief she seeks.

      An order dismissing 2008 and 2010 as moot will be issued, and


                                                   Decision will be entered

                                            sustaining the determination for 2006

                                            and 2009.
