                        T.C. Memo. 2010-280



                     UNITED STATES TAX COURT



                 THOMAS M. GILLUM, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 16110-07L.              Filed December 22, 2010.



     Kenneth R. Boiarsky, for petitioner.

     Elizabeth Downs, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     THORNTON, Judge:   Pursuant to sections 6320(c) and 6330(d),

petitioner seeks judicial review of respondent’s determination

sustaining the filing of a Federal tax lien with respect to

petitioner’s Federal income tax liabilities for 1998, 2000, 2001,

and 2002, and sustaining a proposed levy to collect petitioner’s

Federal income tax liabilities for each of the years 1996 through
                                - 2 -

2002.1   Petitioner also seeks judicial review of various letters

that respondent allegedly sent to various entities, as

petitioner’s nominees or alter egos, denying them collection due

process hearings with respect to respondent’s filing of Federal

tax liens.

                          FINDINGS OF FACT

     The parties have stipulated some facts, which we incorporate

by this reference.    When he filed his petition, petitioner

resided in Arkansas.

     Petitioner is a veterinarian.      He operates his practice

under the business name Cloverdale Animal Hospital, LLC

(Cloverdale).

     In 2004 petitioner was criminally prosecuted for willful

failure to file tax returns, in violation of section 7203, for

taxable years 1996 through 2002.    In December 2005 petitioner

pleaded guilty to one count of criminal failure to file a Federal

income tax return for 2000.    His criminal plea agreement

provided, inter alia, for entry of an order of mandatory

restitution under 18 U.S.C. section 3663A for “the full amount of

the taxes due and owing for all prosecution years.”      The plea

agreement stated:    “At this time, the United States and the

defendant agree that the amount of restitution payable by the


     1
      Unless otherwise indicated, all section references are to
the Internal Revenue Code. All figures are rounded to the
nearest dollar.
                                 - 3 -

defendant is $416,210.”     The plea agreement also stated:   “Except

to the extent otherwise expressly specified herein, this

Agreement does not bar or compromise any civil or administrative

claim pending or that may be made against the defendant,

including but not limited to tax matters.”     The plea agreement

stated further:   “This Agreement is binding only upon the United

States Attorney’s Office for the Eastern District of Arkansas and

the defendant.    It does not bind * * * any other federal, state

or local prosecuting, administrative, or regulatory authority.”

     In its judgment filed December 12, 2005, the District Court

reduced the amount of restitution, labeled “criminal monetary

penalties”, to $246,226.2    The District Court also ordered a

schedule of payments, with a lump sum of $25 due immediately and

the balance due in monthly installments equaling 10 percent of

petitioner’s monthly gross income.3

     While the criminal proceedings were pending against

petitioner, on August 13, 2004, he filed amended returns for

taxable years 1996, 1997, and 1998, and on September 7, 2004, he




     2
      This amount corresponded to the amount stated in the plea
agreement as representing petitioner’s total tax liability for
the years 1999 through 2001. The record does not conclusively
show why the District Court reduced the restitution in this
manner.
     3
      The record does not establish whether petitioner has
complied with the restitution order.
                               - 4 -

filed an amended return for taxable year 1999.4   Also on

September 7, 2004, petitioner filed delinquent returns for

taxable years 2000, 2001, and 2002.

     On October 25, 2004, respondent assessed the taxes that

petitioner had reported on his delinquent returns for 2000, 2001,

and 2002.   On March 14, 2005, respondent assessed the tax that

petitioner had reported on his amended 1998 return, and on June

26, 2006, respondent assessed the taxes that petitioner had

reported on his amended returns for 1996, 1997, and 1999.    In

each instance, respondent also assessed applicable additions to

tax and interest.

     On October 18, 2006, respondent sent petitioner Letter 3172,

Notice of Federal Tax Lien Filing and Your Right to a Hearing

Under IRC 6320 (the lien notice), with respect to petitioner’s

taxable years 1998, 2000, 2001, 2002, and 2003.   On October 26,

2006, respondent sent petitioner Letter 1058, Final Notice,

Notice of Intent to Levy and Notice of Your Right to a Hearing

(the levy notice), with respect to petitioner’s taxable years

1996 through 2003.   The levy notice indicated that as of November




     4
      Insofar as the record shows, these were the first returns
that petitioner filed for these years. Apparently, they were
characterized as “amended” returns because respondent had
previously prepared substitutes for returns for petitioner’s
taxable years 1996 through 1999.
                               - 5 -

25, 2006, petitioner would owe $839,856 of tax, penalties, and

interest for these years.5

     On November 21, 2006, petitioner timely submitted Form

12153, Request for a Collection Due Process Hearing, indicating

that he disagreed with both the lien notice and the levy notice.6

The request covered petitioner’s tax years 1996 through 2002 but

not 2003.   In his request petitioner asserted that the criminal

plea agreement and judgment reflected the full settlement of his

tax liabilities for 1996 through 2002.   He asserted that “payment

on these years is exclusively covered under an agreed court order

for restitution”, that he was making payments to the IRS for

these tax years under this agreement, and that unless he failed

to meet his obligations under the court order, the IRS must

“cease and desist from further collection activity.”   Petitioner

did not propose any collection alternative in his hearing

request.

     On October 26, 2006, in anticipation of submitting a request

for a hearing, petitioner submitted Form 433-A, Collection

Information Statement for Wage Earners and Self-Employed


     5
      The notice indicates that $47,567 of this amount relates to
petitioner’s 2003 taxable year.
     6
      After petitioner submitted his request for a collection due
process (CDP) hearing, on Dec. 8, 2006, respondent issued to
petitioner a notice of deficiency with respect to petitioner’s
taxable years 1998 through 2002. The parties agree that the
deficiencies determined in the notice are not at issue in this
case.
                                - 6 -

Individuals, with respect to himself, and on October 27, 2006,

petitioner submitted Form 433-B, Collection Information Statement

for Businesses, with respect to Cloverdale.   On these forms

petitioner failed to provide complete information.    For example,

on Form 433-A he did not provide requested bank account numbers

and routing information, detailed credit card information, the

estimated value of three vehicles, or required information with

respect to his personal assets and living expenses.    In response

to a question asking whether he had transferred any assets for

less than their actual value within the past 10 years, he checked

“No” but then wrote “Possible”.   The form required several

attachments, including proof of current expenses, which

petitioner failed to provide.

     On Form 433-B petitioner did not provide detailed

information with respect to Cloverdale’s accounts receivable,

business assets, bank accounts, or available credit.   In response

to a question requesting detailed information with respect to

Cloverdale’s income and expenses, petitioner replied “see

statement attached”, but did not attach any such statement.    The

form also required several other attachments, which petitioner

failed to provide.

     On May 15, 2007, the settlement officer held the first of

three telephone conferences with petitioner’s representative.

In this conference the settlement officer opined that neither the
                               - 7 -

criminal plea agreement nor the judgment barred the IRS from any

civil or administrative actions with respect to petitioner’s

civil tax liabilities and did not compromise those liabilities.

The settlement officer asked the representative whether he wished

to propose any collection alternatives.   The representative

proposed as a collection alternative that the IRS limit its

collection action to the terms of the plea agreement and

judgment.   They agreed to have a second conference.

     Before the second conference the settlement officer reviewed

the collection administrative case file, which included, among

other things:   (1) A memorandum, dated February 22, 2007, from

Revenue Officer Robert Brown to IRS district counsel in Oklahoma

City, Oklahoma, requesting approval to file alter ego and nominee

liens and levies against several entities created by petitioner

(the request); (2) a memorandum from respondent’s associate area

counsel in Oklahoma City responding to the request (the

memorandum); and (3) several diagrams detailing petitioner’s

alleged alter ego and nominee activities.7

     The request indicated on the basis of findings contained

therein that, notwithstanding his prior criminal conviction,

petitioner was still using various sham trusts, nominees, and

alter egos to shield assets and income from taxation.   More

particularly, the request included findings that petitioner had


     7
      The record does not reveal who prepared these diagrams.
                               - 8 -

funneled unreported cash payments from Cloverdale to grantor

trusts and other entities to pay his and his family’s personal

expenses, including cable TV bills, college tuition, life

insurance premiums, vacation expenses, car payments, and hardwood

flooring for petitioner’s residence.    The request concluded that

petitioner had created certain nominee entities, including a

trust known as Lestat Ops, to hold personal assets and real

estate for the purpose of placing them out of the reach of

creditors, mainly the Government.8

     The memorandum indicates that “nominee” refers to an entity

or person to whom a taxpayer has transferred property in an

attempt to conceal it.   According to the memorandum, a Federal

tax lien encumbers such property because although a third party

may have legal title, the taxpayer actually owns the property and

enjoys its full use and benefit.     The memorandum also indicates

that an alter ego generally involves a sham corporation or other

entity used by the taxpayer as an instrumentality to avoid his or

her own legal obligations.   In the memorandum respondent’s

associate area counsel approved nominee liens against three

trusts created by petitioner, including Lestat Ops, as well as

against petitioner’s wife, and approved alter ego liens against



     8
      The request describes Lestat Ops as a trust which holds the
real estate upon which petitioner’s veterinary clinic is located
and indicates that the trust’s beneficiaries are petitioner’s
children.
                                - 9 -

Cloverdale, another limited liability company, and two other

trusts that petitioner had created.

     Cloverdale and Lestat Ops received from the IRS Letters

3172, dated May 15, 2007, providing notice of the filing of

Federal tax liens and advising of the right to a collection due

process (CDP) hearing.    By letters dated June 20, 2007, requests

for CDP hearings with respect to these two entities were timely

submitted.   Shortly thereafter, Cloverdale and Lestat Ops

received letters from Revenue Officer Robert Brown, dated June

25, 2007, acknowledging receipt of the hearing requests but

advising that CDP rights were not available to these entities

because petitioner previously had been afforded CDP rights with

respect to the same tax periods listed in the lien notices.    The

letters indicated, however, that the entities were entitled to a

“Collection Appeal” with the revenue officer’s manager.

     On May 21, 2007, the settlement officer held a second

telephone conference with petitioner’s representative.

Petitioner’s representative continued to maintain, as a

collection alternative to the proposed levy, that collection

should be limited to the amount specified in the criminal plea

agreement and judgment.   The settlement officer indicated that he

had reviewed financial statements and related information in the

collection administrative file and concluded that the financial

statements did not provide full disclosure of petitioner’s income
                               - 10 -

and assets.    Consequently, he was unable to recommend acceptance

of petitioner’s proposed collection alternative.    Petitioner’s

representative requested details of the alleged nondisclosure.

The settlement officer declined to discuss the details at that

time, indicating that he would research the matter.    They agreed

to have another conference.

     After seeking advice of IRS counsel, on May 24, 2007, the

settlement officer held the third and final telephone conference

with petitioner’s representative.   The settlement officer

asserted that petitioner had failed to completely disclose his

income, expenses, and assets, making it impossible to adequately

evaluate his ability to pay.   Without specifically referencing

the request or memorandum that he had reviewed, the settlement

officer asserted that petitioner had diverted income into various

entities and paid personal expenses through these entities for no

apparent legitimate business reason.    He also asserted that

petitioner had attempted to place numerous assets beyond

respondent’s reach in various nominee or alter ego entities.

According to the settlement officer’s case activity record,

petitioner’s representative expressed surprise at this

information, indicated that petitioner apparently had not

disclosed all the facts to him, and stated that he understood why

the settlement officer could not consider a collection

alternative.   After another discussion about the effect of the
                             - 11 -

criminal plea agreement and judgment, the settlement officer

advised the representative that the proposed collection actions

would be sustained.

     On June 15, 2007, respondent’s Office of Appeals mailed

petitioner a Notice of Determination Concerning Collection

Action(s) Under Section 6320 and/or 6330 (the determination),

sustaining the Federal tax lien filing and the proposed levy.

With respect to petitioner’s underlying liability the

determination stated:

     In this case the taxpayer agreed to pay restitution for
     the full amount of the taxes due for all prosecution
     years (1996 through 2002), but the judge, who is not
     bound by the plea agreement, subsequently ordered
     payment of restitution in the amount that is equivalent
     of the tax liability for only one count of the total
     criminal case. The restitution amount relates to the
     tax liability, but it is not the equivalent of the tax
     liability. It is the determination of Appeals that
     neither the plea agreement nor the court judgment
     represent a settlement or compromise of the tax
     liability, and do not bar IRS from taking additional
     collection actions.

     The determination also rejected petitioner’s proposed

collection alternative of limiting collection to the terms of the

criminal plea agreement and judgment, stating:

     Appeals has determined from this review that the
     taxpayer has not accurately reported income and
     expenses, which make it impossible to determine his
     true ability to pay the tax liability. The taxpayer
     has done this by diverting income through various
     entities (trusts, limited liability companies, and his
     wife) and paying personal expenses through these
     entities for no apparent reason other than to avoid
     taxes and the collection of taxes. He has also placed
     assets beyond the reach of IRS by purchasing them in
                              - 12 -

     the name of various entities he controls or
     transferring them to these entities. It is clear that
     the taxpayer maintains full use and benefits of these
     assets, which include real estate, vehicles,
     watercraft, and all-terrain vehicles. Because these
     assets and any encumbrances against these assets have
     not been disclosed, Appeals is not able to determine
     their net equity and collection potential. For these
     reasons Appeals cannot accept the only collection
     alternative proposed by the taxpayer’s representative.

     The determination also concluded that the proposed tax lien

filing and levy action properly balanced the need for efficient

collection of taxes with the concern that collection action be no

more intrusive than necessary.

     Petitioner timely petitioned this Court for judicial review

of this determination.   The petition also seeks judicial review

of letters which petitioner asserts respondent mailed on June 25,

2007, to four entities created by petitioner, including

Cloverdale and Lestat Ops, denying them the opportunity for CDP

hearings with respect to the filing of tax liens against them as

petitioner’s alleged nominees, transferees, or alter egos.9

                              OPINION

I.   Statutory Framework

     Section 6321 imposes a lien in favor of the United States on

all property and property rights of a person who is liable for


     9
      The record contains the June 25, 2007, letters, described
supra, from Revenue Officer Robert Brown to Cloverdale and Lestat
Ops. The petition seems to assert that two other entities,
Piraeus Group and MRMLBS, received similar letters also dated
June 25, 2007. The record does not contain copies of any such
letters.
                              - 13 -

and fails to pay tax after demand for payment has been made.       The

lien arises when assessment is made and continues until the

liability is paid or becomes unenforceable by lapse of time.

Sec. 6322.   For the lien to be valid against certain third

parties, the Secretary must file a notice of Federal tax lien;

within 5 business days thereafter, the Secretary must provide

written notice to the taxpayer.   Secs. 6320(a), 6323(a).    The

taxpayer then has 30 days to request an administrative hearing

before an Appeals officer.   Sec. 6320(a)(3)(B), (b)(1); sec.

301.6320-1(c)(1), Proced. & Admin. Regs.   To the extent

practicable, a hearing requested under section 6320 is to be held

in conjunction with a related hearing requested under section

6330.   Sec. 6320(b)(4).

     Section 6330 requires the Secretary to furnish a person

notice and opportunity for a hearing before levying on the

person’s property.   At the hearing, the person may raise any

relevant issue relating to the unpaid tax or proposed levy,

including spousal defenses, challenges to the appropriateness of

the collection action, and offers of collection alternatives.

The person may challenge the underlying tax liability if the

person did not receive a notice of deficiency or did not

otherwise have an opportunity to dispute the liability.     Sec.

6330(c)(2)(B); Sego v. Commissioner, 114 T.C. 604 (2000).     After

receiving a notice of determination, the person may seek judicial
                                - 14 -

review in this Court.    Sec. 6330(d)(1); Pension Protection Act of

2006, Pub. L. 109-280, sec. 855, 120 Stat. 1019.       If the validity

of the underlying tax liability is properly at issue, we review

that issue de novo.     Sego v. Commissioner, supra.    Other issues

we review for abuse of discretion.       Id.

II.   Petitioner’s Challenge to His Underlying Liabilities

      Petitioner contends that respondent erred in sustaining the

lien and levy notices because they contravene the criminal plea

agreement and judgment.     Petitioner’s contention represents in

part a challenge to his underlying liabilities for 1996 through

2002.10    Respondent concedes that petitioner is entitled to make

such a challenge but contends that it is without merit.

      Respondent assessed petitioner’s taxes for the years in

question on the basis of the amounts petitioner self-reported on

his amended or delinquent returns for these years.      Petitioner

does not contend that he incorrectly reported his tax liabilities

on these returns.     Rather, he contends that his aggregate tax

liability for 1996 through 2002 is limited to the $246,226 of

restitution ordered in the criminal judgment.     We disagree.

      Pursuant to 18 U.S.C. section 3663(a) (2006), a District

Court may order restitution to the victim of a criminal offense.



      10
      Petitioner has stipulated that his 2003 liability (which
was encompassed by the lien and levy notices but was not included
either in petitioner’s request for a CDP hearing or in
respondent’s determinations) is not at issue in this case.
                              - 15 -

In some circumstances, as in petitioner’s criminal case,

restitution is mandatory.   See 18 U.S.C. sec. 3663A (2006).   An

order to pay restitution is a criminal penalty rather than a

civil penalty.   Creel v. Commissioner, 419 F.3d 1135, 1140 (11th

Cir. 2005).   Although restitution is based upon an estimation of

civil tax liability, it is not a determination of civil tax

liability and generally does not bar the Commissioner from

assessing a greater amount of civil tax liability.   See Morse v.

Commissioner, 419 F.3d 829, 833-835 (8th Cir. 2005), affg. T.C.

Memo. 2003-332; Hickman v. Commissioner, 183 F.3d 535, 537-538

(6th Cir. 1999), affg. T.C. Memo. 1997-566; M.J. Wood Associates,

Inc. v. Commissioner, T.C. Memo. 1998-375.   In fact, the

restitution statute expressly contemplates that a civil claim may

be brought after the criminal prosecution by providing that the

amount paid under a restitution order “shall be reduced by any

amount later recovered as compensatory damages for the same loss

by the victim in * * * any Federal civil proceeding”.   18 U.S.C.

3664(j)(2) (2006).11


     11
      Conversely, payments made pursuant to restitution orders
are applied against tax liabilities. See United States v.
Clayton, 613 F.3d 592 (5th Cir. 2010); United States v. Tucker,
217 F.3d 960, 962 (8th Cir. 2000); M.J. Wood Associates, Inc. v.
Commissioner, T.C. Memo. 1998-375. The record is silent as to
what amounts, if any, of restitution petitioner has paid. On
brief respondent states that petitioner’s “restitution payments
will ultimately be applied to his civil tax liability for the
taxable year 2000, and if in excess of that liability to other
years”. Petitioner, who filed no reply brief, has not challenged
                                                   (continued...)
                                 - 16 -

      Petitioner relies upon Creel v. Commissioner, supra, in

support of his contention that respondent’s proposed collection

actions contravene the restitution order.     Petitioner’s reliance

on Creel is misplaced.     In Creel, the Court of Appeals found that

a restitution order, which specifically encompassed “‘any

interest and penalties which may be imposed by the Internal

Revenue Service’”, included the civil penalties that the

Commissioner later sought to recover in a civil suit.      Id. at

1140.      Furthermore, at the time of the civil suit the taxpayer in

Creel had fully settled the ordered restitution, and the U.S.

attorney had filed a satisfaction of judgment and had also

recorded a cancellation and release that of the judgment lien.

Id.   Taking into account these unusual circumstances, the Court

of Appeals held that the Government had discharged the taxpayer’s

civil tax liabilities as part of the criminal case.

      By contrast, petitioner’s plea agreement expressly states

that it “does not bar or compromise any civil or administrative

claim pending or that may be made against the defendant,

including but not limited to tax matters.”     Further, the plea

agreement states that it is “binding only upon the United States

Attorney’s Office for the Eastern District of Arkansas and the

defendant” and “does not bind * * * any other federal, state or


      11
      (...continued)
this statement or the appropriateness of this treatment.
Consequently, we give this issue no further consideration.
                              - 17 -

local prosecuting, administrative or regulatory authority.”     The

criminal judgment refers to the restitution payments as “criminal

monetary penalties” and makes no mention of civil liabilities or

penalties.   Furthermore, there is no evidence that petitioner has

satisfied his criminal restitution order or received any

discharge.

     We conclude and hold that petitioner’s criminal plea

agreement and judgment ordering restitution did not discharge,

and do not limit respondent’s assessment and collection of,

petitioner’s civil tax liabilities for his taxable years 1996

through 2002.

III. Petitioner’s Proposed Collection Alternative

     We review the settlement officer’s denial of a collection

alternative for abuse of discretion.   See Sego v. Commissioner,

114 T.C. 604 (2000).   The U.S. Court of Appeals for the Eighth

Circuit, to which any appeal of this case would lie, describes

the abuse of discretion standard as “markedly deferential:    if

the amount of tax owed is not in dispute, courts may disturb the

administrative decision only if it constituted ‘a clear abuse of

discretion in the sense of clear taxpayer abuse and unfairness by

the IRS.’”   Fifty Below Sales & Mktg., Inc. v. United States, 497

F.3d 828, 830 (8th Cir. 2007) (quoting Robinette v. Commissioner,

439 F.3d 455, 459 (8th Cir. 2006), revg. 123 T.C. 85 (2004)).
                               - 18 -

     The only collection alternative that petitioner has proposed

is to limit his 1996 through 2002 liability to $246,226; i.e.,

the amount of restitution ordered by the District Court in the

criminal proceeding.   Insofar as this “collection alternative”

represents petitioner’s reassertion of his challenge to his

underlying civil tax liabilities, it was properly rejected for

the reasons just discussed.   And for essentially those same

reasons, the restitution order does not require respondent to

adhere to the restitution payment schedule set forth therein to

collect petitioner’s civil tax liabilities.

     Insofar as petitioner’s “collection alternative” might be

viewed as representing, in effect, an offer-in-compromise, the

settlement officer did not abuse his discretion in rejecting it.

The regulations set forth three grounds for compromising a

liability:   (1) Doubt as to liability; (2) doubt as to

collectibility; and (3) promotion of effective tax

administration.   Sec. 301.7122-1(b), Proced. & Admin. Regs.   As

just discussed, petitioner has put forward no legitimate issue

regarding his civil tax liabilities.    Nor has he expressly argued

that his collection alternative was for the promotion of
                              - 19 -

effective tax administration.12   That leaves doubt as to

collectibility.

      For purposes of evaluating an offer-in-compromise, doubt as

to collectibility exists “where the taxpayer’s assets and income

are less than the full amount of the liability.”   Sec. 301.7122-

1(b)(2), Proced. & Admin. Regs.   Because he submitted incomplete

Forms 433-A and 433-B, petitioner failed to provide the

settlement officer all financial information necessary to

evaluate his ability to fully pay his civil tax liabilities.   For

that reason, if for no other, the settlement officer did not

abuse his discretion in rejecting any collection alternative

based on doubt as to collectibility.   See, e.g., Kansky v.

Commissioner, T.C. Memo. 2007-40; Criner v. Commissioner, T.C.

Memo. 2003-328.

IV.   Fair Hearing

      Petitioner complains that he was denied a fair collection

hearing because the settlement officer did not disclose to his



      12
      The Commissioner may compromise a tax liability for
promotion of effective tax administration if: (1) Collection in
full could be achieved but would cause economic hardship; or (2)
if there are compelling public policy or equity considerations
identified by the taxpayer. Sec. 301.7122-1(b)(3), Proced. &
Admin. Regs.; see Speltz v. Commissioner, 124 T.C. 165, 172-173
(2005), affd. 454 F.3d 782 (8th Cir. 2006). Petitioner has not
argued and the record does not suggest that he meets these
conditions. Nor does the record suggest that petitioner raised
these issues at the collection hearing; accordingly, he is not
entitled to raise them in this proceeding. See Giamelli v.
Commissioner, 129 T.C. 107, 114 (2007).
                              - 20 -

representative all the information in the collection

administrative file which the settlement officer had reviewed in

reaching his conclusions.13

     Collection hearings are conducted in an informal setting

that does not include the right to discovery.   See Katz v.

Commissioner, 115 T.C. 329 (2000), Davis v. Commissioner, 115

T.C. 35, 41-42 (2000).   The information that the settlement

officer reviewed related to matters that should have been within

petitioner’s knowledge, and the settlement officer did in fact

share with petitioner’s representative the nature of his concerns



     13
      The materials which the settlement officer reviewed
included Revenue Officer Brown’s request to IRS district counsel
to file alter ego and nominee liens and levies and district
counsel’s memorandum approving the filing of alter ego and
nominee liens. Petitioner contends that these materials were not
included in the administrative file. The parties have
stipulated, however, that the stipulated exhibits, which include
the materials in question, “constitute the complete
administrative record in this case”. Petitioner has not raised,
and consequently we do not consider, any issue as to whether the
settlement officer’s review of such materials entailed any
improper ex parte communication.

     Over respondents’ objection, petitioner called the
settlement officer as a witness at trial, attempting to show that
the settlement officer failed to adequately explain the reasons
for his determination. Cf. Robinette v. Commissioner, 439 F.3d
455, 461 (8th Cir. 2006) (indicating that judicial review based
on the administrative record may permit “the receipt of testimony
or evidence explaining the reasoning behind the agency’s
decision”), revg. 123 T.C. 85 (2004). The settlement officer’s
testimony, however, had little probative value or relevancy. On
brief respondent renews his objection to the settlement officer’s
testimony. Because we have not relied upon this testimony in our
analysis or holdings, it is unnecessary to address further
respondent’s objection.
                              - 21 -

about petitioner’s nondisclosure of income and assets.14     More

fundamentally, as just discussed, petitioner’s failure to provide

the settlement officer all required financial information was

reason enough for the settlement officer to reject his collection

alternative.   We do not see that the settlement officer’s

disclosure or nondisclosure of the materials in question had any

significant bearing on the fairness or outcome of petitioner’s

hearing.

V.   Denial of CDP Hearings for Nominees and Alter Egos

     Petitioner asserts that certain entities, including

Cloverdale and Lestat Ops, received nominee or alter ego lien

notices but were improperly denied CDP hearings.15   According to

the regulations, nominees and alter egos holding property for a

taxpayer are not entitled to CDP hearings.   Sec. 301.6330-

1(b)(2), Q&A-B5, Proced. & Admin. Regs.   In any event, we cannot

enter a decision affecting the entities in question because they




     14
      Shortly before the second telephone conference between
petitioner’s representative and the settlement officer on May 21,
2007, the IRS had mailed to Cloverdale and Lestat Ops (and,
according to petitioner’s allegations, at least two other
entities) nominee notices of Federal tax lien filing.
     15
      Respondent issued the nominee notices of Federal tax lien
filing for Cloverdale and Lestat Ops (and, according to
petitioner’s allegations, for at least two other entities) on May
15, 2007, months after respondent had issued petitioner the
notice of Federal tax lien filing upon which this case is
predicated.
                               - 22 -

are not parties to this proceeding.     See Dalton v. Commissioner,

135 T.C.   ,      (2010) (slip op. at 15).

V.   Conclusion

     We sustain respondent’s determinations sustaining the filing

of the notice of Federal tax lien and the proposed levy.


                                             Decision will be entered

                                      for respondent.
