                      T.C. Summary Opinion 2009-95



                        UNITED STATES TAX COURT



                   SHELLI L. CALDWELL, Petitioner v.
             COMMISSIONER OF INTERNAL REVENUE, Respondent



        Docket No. 25614-07S.              Filed June 16, 2009.



        Shelli L. Caldwell, pro se.

        Susan M. Fenner, for respondent.



     DEAN, Special Trial Judge:       This case was heard pursuant to

the provisions of section 7463 of the Internal Revenue Code in

effect when the petition was filed.      Pursuant to section 7463(b),

the decision to be entered is not reviewable by any other court,

and this opinion shall not be treated as precedent for any other

case.     Unless otherwise indicated, subsequent section references
                               - 2 -

are to the Internal Revenue Code as amended, and all Rule

references are to the Tax Court Rules of Practice and Procedure.

     The issue for decision is whether petitioner is entitled to

relief from joint and several liability under section 6015(f) for

2003.

                            Background

     Some of the facts have been stipulated and are so found.

The stipulation of facts and the exhibits received into evidence

are incorporated herein by reference.    When the petition was

filed, petitioner resided in Texas.

     Petitioner and Derek Caldwell (Mr. Caldwell) reported income

tax due of $9,125 and submitted no payment with their late-filed

2003 Form 1040, U.S. Individual Income Tax Return.    On February

26, 2005, respondent sent petitioner a final notice of intent to

levy and notice of her right to a hearing (final notice) by

certified mail.   Petitioner received the final notice but did not

request a hearing under section 6330.    On May 24, 2007,

petitioner filed a Form 8857, Request for Innocent Spouse Relief,

with the Internal Revenue Service (IRS).    She sought relief from

joint and several liability pursuant to section 6015(f).

Respondent denied petitioner’s request for relief from joint and

several liability because her Form 8857 was filed more than 2

years after the first collection action taken against her.
                               - 3 -

Therefore, respondent did not consider the substantive merits of

petitioner’s request for relief from joint and several liability.

                            Discussion

     Section 6013(d)(3) provides that if a joint return is filed,

the tax is computed on the taxpayers’ aggregate income, and

liability for the resulting tax is joint and several.     See also

sec. 1.6013-4(b), Income Tax Regs.     But the IRS may relieve a

taxpayer from joint and several liability under section 6015(f)

if, taking into account all the facts and circumstances, it is

inequitable to hold the taxpayer liable for any unpaid tax or

deficiency and the taxpayer does not qualify for relief under

section 6015(b) or (c).   Except as otherwise provided in section

6015, the taxpayer bears the burden of proof.     Rule 142(a); Alt

v. Commissioner, 119 T.C. 306, 311 (2002), affd. 101 Fed. Appx.

34 (6th Cir. 2004).

     The Commissioner has issued revenue procedures to guide IRS

employees in determining whether a requesting spouse is entitled

to relief from joint and several liability.     Rev. Proc. 2003-61,

2003-2 C.B. 296, modifying and superseding Rev. Proc. 2000-15,

2000-1 C.B. 447.   Rev. Proc. 2003-61, supra, lists the factors

that IRS employees should consider, and the Court also uses the

factors when reviewing the Commissioner’s denial of relief.     See

Washington v. Commissioner, 120 T.C. 137, 147-152 (2003).
                                 - 4 -

     Rev. Proc. 2003-61, sec. 4.01, 2003-2 C.B. at 297, lists

seven threshold conditions that a taxpayer must satisfy in order

to qualify for equitable relief.     Among other things, it requires

a requesting spouse to request relief from joint and several

liability no later than 2 years after the date of the

Commissioner’s first collection activity after July 22, 1998,

against the requesting spouse.     Id.   Similarly, section 1.6015-

5(b)(1), Income Tax Regs., provides that a requesting spouse must

request relief from joint and several liability no later than 2

years from the date of the Commissioner’s first collection

activity after July 22, 1998, against the requesting spouse.      The

term “collection activity” is defined to include a section 6330

notice, which is also defined as the notice the IRS sends to

taxpayers informing them of the IRS’s intent to levy and their

right to request a hearing.   See sec. 1.6015-5(b)(2), Income Tax

Regs.

     The Court recently held that section 1.6015-5(b)(1), Income

Tax Regs., is an invalid interpretation of section 6015(f).

Mannella v. Commissioner, 132 T.C. __, __ (2009) (slip op. at 11-

12) (applying Chevron deference in view of Court of Appeals for

the Third Circuit precedent); Lantz v. Commissioner, 132 T.C. __,

__, __ (2009) (slip op. at 11, 33) (applying Chevron1 deference



     1
      Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc.,
467 U.S. 837 (1984).
                              - 5 -

in view of Court of Appeals for the Seventh Circuit precedent).

Under Golsen v. Commissioner, 54 T.C. 742 (1970), affd. 445 F.2d

985 (10th Cir. 1971), the Court applies the law of the Court of

Appeals to which an appeal would ordinarily lie even in cases

subject to sec. 7463(b).

     It is unclear which standard of deference the Court of

Appeals for the Fifth Circuit would apply to section

1.6015-5(b)(1), Income Tax Regs.   Compare Dresser Indus., Inc. v.

Commissioner, 911 F.2d 1128, 1137 (5th Cir. 1990) (legislative

regulations2 are entitled to Chevron deference and are given

controlling weight unless they are “arbitrary, capricious, or

manifestly contrary to the statute”), affg. in part and revg. in

part 92 T.C. 1276 (1989), with id. at 1138 (an interpretive

regulation is accorded less deference under National Muffler3 but

is valid if the regulation is a reasonable interpretation and

harmonizes with the statute’s plain language, its origin, and its

purpose), Pool Co. v. Cooper, 274 F.3d 173, 177 n.3 (5th Cir.

2001) (“Mead4 clarified that * * * [Chevron deference applies to

an agency’s interpretation only] when ‘Congress delegated


     2
      Sec. 1.6015-5, Income Tax Regs., was issued under both a
general grant of authority under sec. 7805 and a specific grant
of authority under sec. 6015(h). Lantz v. Commissioner, 132 T.C.
__, __ (2009) (slip op. at 11).
     3
      Natl. Muffler Dealers Association, Inc. v. United States,
440 U.S. 472 (1979).
     4
      United States v. Mead Corp., 533 U.S. 218 (2001).
                              - 6 -

authority to the agency generally to make rules carrying the

force of law’” (quoting United States v. Mead Corp., 533 U.S.

218, 226-227 (2001))), and Kornman & Associates, Inc. v. United

States, 527 F.3d 443, 455 n.10 (5th Cir. 2008) (the Court of

Appeals for the Fifth Circuit did not address the level of

deference applicable to certain IRS regulations post-Mead5

because the regulations were not challenged by the parties).

     But the Court need not decide whether the Court of Appeals

for the Fifth Circuit would apply Chevron or some lesser standard

of deference to section 1.6015-5(b)(1), Income Tax Regs., for the

Commissioner’s interpretation is neither a permissible

construction nor a reasonable interpretation of section 6015(f).

See Lantz v. Commissioner, supra at __ n.4 (slip op. at 12)

(noting that the Court of Appeals for the Seventh Circuit applies

a reasonableness standard for the second prong of the Chevron

rather than permissible construction); see also Natl. Muffler

Dealers Association, Inc. v. United States, 440 U.S. 472, 476-477

(1979) (IRS regulations must implement Congress’s “‘mandate in

some reasonable manner’” (quoting United States v. Cartwright,

411 U.S. 546, 550 (1973))); Metro. Stevedore Co. v. Rambo, 521


     5
      Pursuant to Mead (or Skidmore) “‘The weight [accorded to an
administrative] judgment * * * [depends on] the thoroughness
evident in its consideration, the validity of its reasoning, its
consistency with earlier and later pronouncements, and all those
factors which give it power to persuade, if lacking power to
control.’” See United States v. Mead Corp., supra at 228
(quoting Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944)).
                                 - 7 -

U.S. 121, 136 (1997) (an agency’s “reasonable interpretation

* * * brings at least some added persuasive force” (citing

Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944))).

     At trial respondent conceded that if the 2-year period of

limitations did not apply, petitioner would be entitled to relief

from joint and several liability under section 6015(f).6    Upon

the basis of the foregoing, the Court holds that petitioner is

entitled to relief from joint and several liability under section

6015(f).

     To reflect the foregoing,


                                           Decision will be entered

                                      for petitioner.




     6
      In Lantz v. Commissioner, supra at __ n.3 (slip op. at 12),
the Court also declined to apply Skidmore or Mead deference to
Rev. Proc. 2000-15, 2000-1 C.B. 447, and Rev. Proc. 2003-61,
2003-2 C.B. 296, given the Court of Appeals for the Seventh
Circuit’s precedent. In Bankers Life & Cas. Co. v. United
States, 142 F.3d 973, 983 (7th Cir. 1998), cited in Lantz, the
Court of Appeals held that regulations issued under general or
specific authority of the IRS to promulgate necessary rules are
entitled to Chevron deference.
     Even if the Court were to apply Skidmore or Mead deference
here, it would nevertheless hold that Rev. Proc. 2003-61, supra,
is also not a reasonable interpretation of sec. 6015(f) and is
therefore invalid. See Metro. Stevedore Co. v. Rambo, 521 U.S.
121, 136 (1997); Kornman & Associates, Inc. v. United States, 527
F.3d 443, 455 (5th Cir. 2008) (reasonableness is a factor to
consider when applying Skidmore or Mead deference).
