                         T.C. Memo. 2004-194



                       UNITED STATES TAX COURT



                JAMES G. GILLIGAN, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 14693-02L.              Filed August 30, 2004.



     James G. Gilligan, pro se.

     Matthew A. Mendizabal, for respondent.



                         MEMORANDUM OPINION


     VASQUEZ, Judge:    This case is before the Court on

respondent’s motion for summary judgment and to impose a penalty

under section 66731 (motion for summary judgment).


     1
        Unless otherwise indicated, all section references are to
the Internal Revenue Code, and all Rule references are to the Tax
Court Rules of Practice and Procedure.
                                - 2 -

Background

     Petitioner was born in Alameda, California.     At the time he

filed the petition, petitioner maintained a post office box in

Campbell, California.    Petitioner claims he was homeless during

this time and lived with friends in California, Nevada, and

Oregon.

     For 1992, petitioner initially filed a Form 1040, U.S.

Individual Income Tax Return, and reported a tax liability of

$4,412.2    Petitioner did not remit payment with his return.    On

December 6, 1993, the Internal Revenue Service (IRS) assessed

this amount.    The IRS sent notice and demand for payment letters

to petitioner on May 2, 1994, and December 2, 1996.     On or about

August 20, 1997, petitioner submitted a Form 1040NR, U.S.

Nonresident Alien Income Tax Return, for 1992 and reported a tax

liability of “N/A”.

     For 1993, petitioner initially filed a Form 1040 and

reported a tax liability of $2,254.     Petitioner did not remit

payment with his return.    On November 28, 1994, the IRS assessed

this amount.    The IRS sent notice and demand for payment letters

to petitioner on November 28, 1994, and December 2, 1996.       On or

about August 20, 1997, petitioner submitted a Form 1040NR for

1993 and reported a tax liability of “N/A”.

     On or about August 20, 1997, petitioner filed a Form 1040NR

     2
          All amounts are rounded to the nearest dollar.
                               - 3 -

for 1994 and reported a tax liability of “N/A”.    On May 26, 1998,

the IRS issued petitioner a notice of deficiency for 1994.

Petitioner failed to file a petition with the Court.    On November

23, 1998, the IRS assessed a tax of $141.    The IRS sent notice

and demand for payment letters to petitioner on November 23, and

December 14, 1998.

     On or about August 20, 1997, petitioner filed a Form 1040NR

for 1996 and reported a tax liability of “N/A”.    On August 11,

1998, the IRS issued petitioner a notice of deficiency for 1996.

Petitioner failed to file a petition with the Court.    On February

8, 1999, the IRS assessed a tax of $574.    The IRS sent notice and

demand for payment letters to petitioner on February 8 and March

1, 1999.

     Petitioner made various alterations to the Forms 1040NR for

1992, 1993, 1994, and 1996.   Petitioner crossed out “Income Tax”

on the title.   For “country” he wrote “USA National, aka natural

born free Citizen Constitutionally, California/Republic”.

Petitioner wrote “N/A” on various lines of the forms requiring

information about himself and his income.    Petitioner altered the

jurat on the forms before signing them.    Under the box “Your

occupation in the United States” petitioner wrote “none” and made

various references to the United States Constitution.    At the

bottom of the form, he typed “With expressed reservations of my

Unalienable Rights, of my Constitutional Privileges and
                               - 4 -

Immunities (at 4:2:1), and the lesser UCC/Uniform Commercial Code

(at §1.207) ‘with reservation of all our rights’, for the

Record!”.

     On December 17, 2001, the IRS sent petitioner a “Final

notice--notice of intent to levy and notice of your right to a

hearing” for 1992, 1993, 1994, and 1996.   On January 8, 2002,

petitioner submitted a Form 12153, Request for a Collection Due

Process Hearing, with an 11-page attachment asserting frivolous

and meritless arguments.

     On July 10, 2002, Appeals Officer Eric Johansen conducted a

section 6330 hearing (hearing) in person with petitioner.

Petitioner requested that the hearing be tape recorded; however,

the Appeals officer advised petitioner that the hearing could not

be tape recorded.   At the hearing, petitioner did not raise any

spousal defenses.   He did not propose any collection

alternatives.   Petitioner refused to sign a Form 433-A,

Collection Information Statement for Wage Earners and Self-

Employed Individuals, despite his contentions that he was

unemployed and had no money to pay the tax liability.

     On August 15, 2002, the IRS issued petitioner a Notice of

Determination Concerning Collection Action(s) under Section 6320

and/or 6330 (notice of determination) to proceed with collection.

     On September 13, 2003, petitioner filed a petition with the
                                - 5 -

Court.    In the petition, petitioner advances frivolous and

meritless arguments.

     On March 29, 2004, respondent filed a motion for summary

judgment and to impose a penalty under section 6673.      On April

20, 2004, petitioner filed a lengthy opposition to respondent’s

motion containing frivolous and meritless arguments.      On May 18,

2004, petitioner filed an amended affidavit in support of his

opposition to respondent’s motion for summary judgment containing

frivolous and meritless arguments.      Also on May 18, 2004, the

Court heard oral argument on respondent’s motion.

     At the oral argument, petitioner lost his temper and became

belligerent.    Indeed, the Court repeatedly told petitioner to

“calm down” and warned petitioner that he would be held in

contempt of court if he had further outbursts.      Petitioner

refused to answer the Court’s questions.      Petitioner was

disruptive, noncooperative, and interrupted the Court and

respondent throughout the entire proceeding.

Discussion

     A.     Motions for Summary Judgment

     Rule 121(a) provides that either party may move for summary

judgment upon all or any part of the legal issues in controversy.

Full or partial summary judgment may be granted only if it is

demonstrated that no genuine issue exists as to any material

fact, and a decision may be rendered as a matter of law.       Rule
                                  - 6 -

121(b); Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520

(1992), affd. 17 F.3d 965 (7th Cir. 1994).

       We conclude that there is no genuine issue as to any

material fact and that a decision may be rendered as a matter of

law.

       B.   Section 6330

       Section 6330 provides that the Secretary shall furnish the

person described in section 6331 with written notice (i.e., the

hearing notice) before a levy on any property or right to

property.    Sec. 6330(a).   Section 6330 further provides that

within a 30-day period the taxpayer may request administrative

review of the matter (in the form of a hearing).     The hearing

generally shall be conducted consistent with the procedures set

forth in section 6330(b) and (c).

       Pursuant to section 6330(c)(2)(A), a taxpayer may raise at

the section 6330 hearing any relevant issue with regard to the

Commissioner’s collection activities, including spousal defenses,

challenges to the appropriateness of the Commissioner’s intended

collection action, and alternative means of collection.       Sego v.

Commissioner, 114 T.C. 604, 609 (2000); Goza v. Commissioner, 114

T.C. 176, 180 (2000).      If a taxpayer received a statutory notice

of deficiency for the years in issue or otherwise had the

opportunity to dispute the underlying tax liability, the taxpayer

is precluded from challenging the existence or amount of the
                                  - 7 -

underlying tax liability.    Sec. 6330(c)(2)(B); Sego v.

Commissioner, supra at 610-611; Goza v. Commissioner, supra at

182-183.

           1.    1992 and 1993

     Our jurisdiction under section 6330(d) allows us in a lien

or levy proceeding to redetermine an underlying tax liability

that is entirely self-assessed, although the liability is not a

deficiency.     Montgomery v. Commissioner, 122 T.C. 1 (2004).

Section 6330(c)(2) provides that a taxpayer may raise any

“relevant” issue at the collection hearing.      Petitioner made only

groundless and frivolous arguments.

     Petitioner’s challenge to the existence of his tax liability

is meritless.    The tax assessments generating the levy for 1992

and 1993 are based on the tax shown on returns petitioner filed

under penalties of perjury.      See sec. 6201(a)(1).

     Petitioner questioned the validity of those liabilities

during his hearing.    Petitioner advanced frivolous arguments

during this hearing.    Petitioner continued to advance his

groundless arguments in his petition, in his opposition to

summary judgment, and at the hearing on the motion.     Despite

petitioner’s assertions to the contrary, there is no genuine

issue as to the existence of his 1992 and 1993 unpaid tax.       And

because petitioner challenged only the existence of a law

requiring him to pay a Federal tax on his earnings and did not
                                - 8 -

challenge the correctness of the amounts of income which he

reported on his 1992 and 1993 tax returns, there is no genuine

issue as to the amounts of petitioner’s underlying tax liability

for 1992 and/or 1993.

     Petitioner advanced shopworn arguments characteristic of

tax-protester rhetoric that has been universally rejected by this

and other courts.    Wilcox v. Commissioner, 848 F.2d 1007 (9th

Cir. 1988), affg. T.C. Memo. 1987-225; Carter v. Commissioner,

784 F.2d 1006, 1009 (9th Cir. 1986).    We shall not painstakingly

address petitioner’s assertions “with somber reasoning and

copious citation of precedent; to do so might suggest that these

arguments have some colorable merit.”    Crain v. Commissioner, 737

F.2d 1417, 1417 (5th Cir. 1984).

           2.   1994 and 1996

     The notices of deficiency for 1994 and 1996 were sent via

certified mail to petitioner’s post office box, the address

petitioner used on his returns and in his petition.   These

notices of deficiency were not returned as undeliverable.

Respondent submitted a certified mailing list to confirm these

facts.   Accordingly, in the absence of any evidence or argument

by petitioner to the contrary, petitioner is deemed to have

received these notices of deficiency.    Sego v. Commissioner,

supra at 610-611.

     Petitioner chose not to file a petition for redetermination
                                 - 9 -

in response to these notices of deficiency.      Accordingly,

petitioner cannot contest the underlying deficiencies for 1994

and 1996.   Sec. 6330(c)(2)(B); Sego v. Commissioner, supra; Goza

v. Commissioner, supra at 182-183.       Claims that the limitation

period for assessment has expired are challenges to the

underlying tax liability.    Boyd v. Commissioner, 117 T.C. 127,

130 (2001).   Additionally, the assessments were timely made.

Therefore, petitioner cannot raise these claims in this

proceeding.

     Where the validity of the underlying tax liability is not

properly in issue, we review the Commissioner’s determination for

an abuse of discretion.     Sego v. Commissioner, supra at 610.

     Petitioner appears to argue that the verification

requirement of section 6330 has not been met.      Section 6330(c)(1)

does not require the Commissioner to rely on a particular

document to satisfy the verification requirement imposed therein.

E.g., Schnitzler v. Commissioner, T.C. Memo. 2002-159 (citing

five other cases to support this principle).      We have repeatedly

held that the Commissioner may rely on Forms 4340, Certificate of

Assessments, Payments, and Other Specified Matters, or

transcripts of account to satisfy the verification requirement of

section 6330(c)(1).   Hromiko v. Commissioner, T.C. Memo. 2003-

107; Schnitzler v. Commissioner, supra; Kaeckell v. Commissioner,

T.C. Memo. 2002-114; Obersteller v. Commissioner, T.C. Memo.
                               - 10 -

2002-106; Weishan v. Commissioner, T.C. Memo. 2002-88; Lindsey v.

Commissioner, T.C. Memo. 2002-87, affd. 456 Fed. Appx. 802 (9th

Cir. 2003); Tolotti v. Commissioner, T.C. Memo. 2002-86, affd. 70

Fed. Appx. 971 (9th Cir. 2003); Duffield v. Commissioner, T.C.

Memo. 2002-53; Kuglin v. Commissioner, T.C. Memo. 2002-51.     The

Appeals officer is not required to provide verification to

petitioner at the hearing.   See Nestor v. Commissioner, 118 T.C.

162, 167 (2002); see also Holliday v. Commissioner, T.C. Memo.

2004-172.

     Petitioner argues that the refusal by the Appeals officer to

permit petitioner to make an audio recording of the hearing was

improper.   Commencing with petitioner’s filing of the Forms

1040NR, petitioner has made statements and requests and advanced

contentions and arguments that the Court has found to be

frivolous and/or groundless.   Consequently, even though we held

in Keene v. Commissioner, 121 T.C. 8 (2003), that section

7521(a)(1) requires the Appeals Office to allow a taxpayer to

make an audio recording of a hearing, we conclude that (1) it is

not necessary and will not be productive to remand this case for

another hearing in order to allow petitioner to make such an

audio recording, see Lunsford v. Commissioner, 117 T.C. 183, 189

(2001), and (2) it is not necessary or appropriate to reject

respondent’s determination to proceed with the collection action

as determined in the notice of determination with respect to
                               - 11 -

petitioner’s unpaid liability; see id.; see also Keene v.

Commissioner, supra at 19-20; Kemper v. Commissioner, T.C. Memo.

2003-195.

       Petitioner has not alleged any irregularity in the

assessment procedure that would raise a question about the

validity of the assessments or the information contained in the

Forms 4340 or transcripts of account.    See Davis v. Commissioner,

115 T.C. 35, 41 (2000); Mann v. Commissioner, T.C. Memo. 2002-48.

Appeals Officer Johansen stated in an affidavit that he verified

that all legal and administrative requirements for levy had been

met.    He also considered whether the proposed levy balanced the

need for efficient collection of taxes with the legitimate

concern of the taxpayer that any collection action be no more

intrusive than necessary.    Petitioner has failed to raise a

triable issue of fact concerning the Appeals officer’s review.

Accordingly, we hold that the Appeals officer satisfied the

verification requirement of section 6330(c)(1).    Cf. Nicklaus v.

Commissioner, 117 T.C. 117, 120-121 (2001).

       Petitioner has failed to raise a spousal defense, make a

valid challenge to the appropriateness of respondent’s intended

collection action, or offer alternative means of collection.

These issues are now deemed conceded.    See Rule 331(b)(4).
                              - 12 -

     C.   Section 6673

     Section 6673(a)(1) authorizes the Court to require a

taxpayer to pay to the United States a penalty not to exceed

$25,000 if the taxpayer took frivolous positions in the

proceedings or instituted the proceedings primarily for delay.    A

position maintained by the taxpayer is “frivolous” where it is

“contrary to established law and unsupported by a reasoned,

colorable argument for change in the law.”   Coleman v.

Commissioner, 791 F.2d 68, 71 (7th Cir. 1986); see also Hansen v.

Commissioner, 820 F.2d 1464, 1470 (9th Cir. 1987) (section 6673

penalty upheld because taxpayer should have known claim was

frivolous).

     At the hearing, the Court warned petitioner that the

arguments he was advancing were frivolous and groundless, and

that the arguments had been rejected by the Courts.

     Our authority and willingness to impose penalties pursuant

to section 6673(a) on those taxpayers who abuse the protections

afforded by sections 6320 and 6330 by instituting or maintaining

actions under those sections primarily for delay or by taking

frivolous or groundless positions in such actions are well

established.   Cf. Pierson v. Commissioner, 115 T.C. 576, 581

(2000).   Petitioner filed a frivolous petition with the Court.

Petitioner’s position, based on stale and meritless contentions,

is manifestly frivolous and groundless, and he has wasted the
                              - 13 -

time and resources of the Court.   We are convinced that

petitioner instituted and maintained these proceedings primarily

for delay.   Accordingly, we shall impose a penalty of $5,000

pursuant to section 6673.

     In reaching all of our holdings herein, we have considered

all arguments made by the parties, and to the extent not

mentioned above, we find them to be irrelevant or without merit.

     To reflect the foregoing,

                                         An appropriate order and

                                    decision will be entered.
