                        T.C. Memo. 2011-166



                      UNITED STATES TAX COURT



                 MICHAEL L. CONN, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 4422-07L.               Filed July 11, 2011.



     Eric Johnson, for petitioner.

     Derek B. Matta, for respondent.



                        MEMORANDUM OPINION


     MARVEL, Judge:   Pursuant to section 6330(d),1 petitioner has

petitioned for a review of respondent’s determinations (1) to

file a notice of Federal tax lien (NFTL) with respect to

petitioner’s unpaid Federal income tax liability for 1993 and (2)


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

to proceed by levy to collect that liability.   After

concessions,2 the issue we must decide is whether respondent

abused his discretion in determining that the proposed levy may

proceed and that the NFTL filed with respect to the unpaid

liability was appropriate.   To resolve this issue, the parties

contend we must consider the following questions:   (a) Whether

this Court has jurisdiction to consider petitioner’s unperfected

and untimely claims that he overpaid his tax liabilities for

years after 2003 (nondetermination years) and that the

overpayments should be applied to reduce or eliminate the unpaid

liability for 1993 (determination year); and (b) whether the

mitigation provisions of sections 1311-1314 enable us to consider

petitioner’s overpayment claims with respect to the

nonndetermination years.

                             Background

     The parties submitted this case fully stipulated pursuant to

Rule 122.   The stipulation of facts is incorporated herein by

this reference.   Petitioner resided in Louisiana when the

petition was filed.

     Petitioner and his wife, Patricia A. Conn, timely filed

their 1993 Form 1040, U.S. Individual Income Tax Return.

Subsequently, petitioner was indicted for making, uttering, and



     2
      Petitioner concedes his claim for interest abatement and
agrees that collection alternatives are no longer at issue.
                                 - 3 -

possessing forged securities.    The charges arose from

petitioner’s misappropriation of funds from the Police

Association of New Orleans.    On September 5, 1996, petitioner

pleaded guilty to making, uttering, and possessing a forged

security with the intent to deceive under 18 U.S.C. sec. 513(a).

As part of petitioner’s sentence, the U.S. District Court for the

Eastern District of Louisiana ordered him to pay $185,248.86 in

restitution and sentenced him to 15 to 21 months’ imprisonment.

     On the basis of the criminal case, respondent determined

that petitioner was required to include the misappropriated funds

in his income for 1993 but that he failed to do so.    On April 8,

1997, respondent mailed to petitioner a notice of deficiency for

1993.    At that time, petitioner was serving his sentence in a

Federal penitentiary in Texas.     Conn v. Commissioner, T.C. Memo.

2008-186.    Although respondent mailed a joint notice of

deficiency to petitioner and his wife at their last known

address, petitioner did not receive the notice or file a timely

petition to contest it because of his temporary residence in the

Federal penitentiary.3   Id.

     On September 9, 1997, respondent assessed an income tax

deficiency of $14,445, a section 6663 penalty of $9,639, and


     3
      Mrs. Conn filed a separate petition in response to the
notice of deficiency. Before trial the Commissioner conceded
that under sec. 6015 Mrs. Conn was not liable for the deficiency,
and we entered a decision reflecting the settlement. Conn v.
Commissioner, T.C. Memo. 2008-186.
                                - 4 -

interest (collectively, the 1993 liability) against petitioner

for 1993.    Respondent subsequently filed two NFTLs against

petitioner’s property in Louisiana and mailed petitioner a Notice

of Federal Tax Lien Filing and Your Right to a Hearing, dated

January 16, 2003.    On February 7, 2003, respondent mailed to

petitioner a Final Notice of Intent to Levy and Notice of Your

Right to a Hearing with respect to the 1993 liability.

     Petitioner timely submitted a Form 12153, Request for a

Collection Due Process Hearing, to contest the lien and levy

notices.    In the Form 12153 and throughout the hearing process

petitioner specifically requested the right to challenge the 1993

liability.

     Settlement Officer Brenda Esser (Settlement Officer Esser)

conducted a section 6330 hearing on November 14, 2006.    She did

not permit petitioner to contest the 1993 liability because

respondent had mailed a notice of deficiency to him for 1993.      In

a notice of determination dated January 18, 2007, respondent’s

Appeals Office determined that the lien and levy actions were

proper and sustained them.

     On February 23, 2007, petitioner timely filed a petition for

review of respondent’s determinations.    In the resulting case

this Court found that Settlement Officer Esser had improperly

denied petitioner the right to raise the 1993 liability issue.

Conn v. Commissioner, supra.    We held that, under section
                                - 5 -

6330(c)(2)(B), petitioner could challenge the 1993 liability

because he never received the notice of deficiency.     Id.     We

remanded the case to respondent to conduct a supplemental hearing

under section 6330 at which petitioner could challenge the 1993

liability.

     The case on remand was assigned to Settlement Officer Doris

Augustine (Settlement Officer Augustine), who conducted the

supplemental hearing on March 3, 2009.     Settlement Officer

Augustine concluded that respondent had properly determined

petitioner’s 1993 liability.   Respondent’s Appeals Office issued

a Supplemental Notice of Determination Concerning Collection

Actions Under Sections 6320 and 6330 again upholding the

collection actions.

     The case was set for trial in New Orleans on November 20,

2009.    Before the trial date petitioner and respondent reached a

settlement on the 1993 liability issue.4    In a stipulation of

settled issues the parties agreed that petitioner was liable for

a $5,778 deficiency and a section 6663 penalty of $3,855 for 1993

plus interest (the stipulated liability).     In a second

stipulation of settled issues, the parties agreed that petitioner

had failed to report $17,872 of income for 1993.


     4
      Petitioner took the position that although he was convicted
of embezzlement, he did not direct the embezzled funds to himself
or use the funds for personal purposes. See Conn v.
Commissioner, supra.
                                 - 6 -

     On January 19, 2010, respondent filed a motion for remand to

consider collection alternatives.    We granted the motion and

remanded the case for another supplemental hearing to be held by

April 26, 2010.

     The second remand was assigned to Settlement Officer James

Feist (Settlement Officer Feist).    On February 4, 2010,

Settlement Officer Feist requested that petitioner submit

specified information and documents before the hearing, including

an updated Form 433-A, Collection Information Statement for Wage

Earners and Self-Employed Individuals, financial documentation

supporting that form, and a plan to satisfy the stipulated

liability.

     Petitioner did not submit any of the requested financial

information.   Instead, petitioner submitted unsigned Forms 1040X,

Amended U.S. Individual Income Tax Return, claiming that he had

overpaid his taxes for 1998 through 2004 and 2006 through 2008.5

The overpayments were attributable to restitution payments that

petitioner had made to satisfy the restitution component of his

sentence in the criminal case.    Beginning in November 1996,

petitioner made restitution payments.    As of January 19, 2010,

petitioner had made restitution payments totaling $50,827.22.

Petitioner claimed deductions for the restitution payments on



     5
      After the hearing petitioner restricted his claim to
offsets arising from overpayments made through 2004.
                               - 7 -

Schedules C, Profit or Loss From Business (Sole Proprietorship),

attached to the unsigned Forms 1040X.6

     On February 18, 2010, Settlement Officer Feist held a

telephone conference with petitioner and petitioner’s counsel.

Petitioner argued that the overpayments shown on the unsigned

Forms 1040X for the nondetermination years should be offset

against the 1993 liability.   However, Settlement Officer Feist

did not consider the Forms 1040X because petitioner had not

signed or filed them.

     Furthermore, Settlement Officer Feist determined that he

could not consider the overpayment claims because (1) the

overpayment claims were for nondetermination years and

petitioner’s assertion that he was entitled to offsets from

nondetermination years was not an appropriate collection



     6
      Petitioner claimed the following amounts on his Forms
1040X: For 1998, a business expense deduction of $1,625 and an
overpayment of $454; for 1999, a business expense deduction of
$1,200 and an overpayment of $400; for 2000, a business expense
deduction of $4,042 and an overpayment of $1,334; for 2001, a
business expense deduction of $2,875 and an overpayment of $947;
for 2002, a business expense deduction of $1,650 and an
overpayment of $463; for 2003, a business expense deduction of
$575 and an overpayment of $165; for 2004, a business expense
deduction of $5,580 and an overpayment of $1,801; for 2006, a
business expense deduction of $6,500 and an overpayment of
$1,753; for 2007, a business expense deduction of $6,500 and an
overpayment of $2,661; and, for 2008, a business expense
deduction of $6,000 and an overpayment of $1,949. The business
expense deductions on the Schedules C equal the amounts of
restitution that petitioner paid to the Department of Justice,
except for 2004, when petitioner paid $7,985 in restitution but
deducted only $5,580 on his 2004 Form 1040X.
                              - 8 -

alternative, and (2) the overpayment claims were not timely

asserted during the section 6330 hearing.7

     Petitioner also claimed that he was entitled to interest

abatement for the period from his hearing request until receipt

of a response from the Appeals Office.   Settlement Officer Feist

denied this request, concluding that petitioner’s interest

abatement claims exceeded the scope of the hearing.8    Finally,

Settlement Officer Feist concluded that petitioner presented no

viable collection alternative, largely because of his failure to

provide pertinent financial information or to suggest an

appropriate alternate method of paying the liability.

     On March 11, 2010, respondent’s Appeals Office issued a

supplemental notice of determination denying petitioner’s request

for collection alternatives, finding that all legal and

procedural requirements had been met as required by section



     7
      In concluding that the Forms 1040X and attached Schedules C
could not be considered, Settlement Officer Feist stated:

     Requesting adjustments of tax in periods outside of the
     subject tax period is not a collection alternative.
     Requesting adjustments is a liability issue for periods
     other than the one subject period and this issue not
     part of the current remand. In my opinion, this issue
     could have been and should have been raised and
     addressed no later than immediately after the time that
     the current assessment was sustained by Appeals Officer
     Augustine.
     8
      As noted supra note 2, petitioner subsequently waived his
claims for interest abatement and for consideration of collection
alternatives.
                               - 9 -

6330(c)(1) and determining that the lien and levy actions could

proceed.

                            Discussion

I.   Collection Hearing Procedure

     A.    Filing of NFTL and Related Hearing Rights

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

all property and property rights of a taxpayer liable for taxes

after a demand for the payment of the taxes has been made and the

taxpayer fails to pay those taxes.     The lien arises when the

assessment is made.   Sec. 6322.    Section 6323(f) generally

requires the Secretary9 to file an NFTL with the appropriate State

office for the lien to be valid against certain third parties.

Section 6320(a) requires the Secretary to notify the taxpayer in

writing of the filing of an NFTL and of the taxpayer’s right to

an administrative hearing on the matter.     Section 6320(b) affords

the taxpayer the right to a hearing.     Section 6320(c) requires

that the administrative hearing be conducted pursuant to section

6330(c), (d) (other than paragraph (2)(B) thereof), and (e).




     9
      The term “Secretary” means “the Secretary of the Treasury
or his delegate”, sec. 7701(a)(11)(B), and the term “or his
delegate” means “any officer, employee, or agency of the Treasury
Department duly authorized by the Secretary of the Treasury
directly, or indirectly by one or more redelegations of
authority, to perform the function mentioned or described in the
context”, sec. 7701(a)(12)(A).
                                - 10 -

     B.   Notice of Intent To Levy and Related Hearing Rights

     Section 6331(a) authorizes the Secretary to levy upon all

property and property rights of a taxpayer liable for taxes who

fails to pay those taxes within 10 days after notice and demand

for payment.     Section 6330(a) provides that no levy may be made

on any property or rights to property of any person unless the

Secretary has notified such person in writing of the right to a

hearing before the levy is made.     Section 6330(b) affords the

taxpayer the right to a hearing.     Section 6330(c) specifies the

matters to be considered at the administrative hearing and sets

forth the hearing procedures.

     C.   The Section 6320/6330 Hearing

     If a taxpayer requests a hearing in response to either an

NFTL or a notice of levy pursuant to section 6320 or 6330, a

hearing shall be held before an impartial officer or employee of

the IRS Office of Appeals.    Sec. 6330(b)(1), (3).   At the hearing

the taxpayer may raise any relevant issue, including appropriate

spousal defenses, challenges to the appropriateness of the

collection action, and collection alternatives.    Sec.

6330(c)(2)(A).    A taxpayer may also contest the existence or

amount of the underlying tax liability if he did not receive a

notice of deficiency or did not otherwise have an opportunity to

dispute the tax liability.    Sec. 6330(c)(2)(B); see also Sego v.

Commissioner, 114 T.C. 604, 609 (2000).
                               - 11 -

     Following the hearing, the Appeals Office must determine

whether the proposed collection action may proceed.   In making

that determination, the Appeals Office is required to take into

consideration:   (1) Verification presented by the Secretary

during the hearing process that the requirements of applicable

law and administrative procedure have been met, (2) relevant

issues raised by the taxpayer, and (3) whether the proposed lien

or levy action appropriately balances the need for efficient

collection of taxes with the taxpayer’s concerns regarding the

intrusiveness of the proposed levy action.   Sec. 6330(c)(3).

     Section 6330(d)(1) grants this Court jurisdiction to review

the determination made by the Appeals Office in connection with

the section 6330 hearing.   Where the underlying tax liability10 is

properly at issue, we review the taxpayer’s liability de novo.

See Goza v. Commissioner, 114 T.C. 176, 181-182 (2000).    We

review all other determinations for abuse of discretion.

Lunsford v. Commissioner, 117 T.C. 183, 185 (2001); Sego v.

Commissioner, supra at 610; Goza v. Commissioner, supra at 182.

An abuse of discretion occurs if the Appeals Office exercises its

discretion “arbitrarily, capriciously, or without sound basis in

fact or law.”    Woodral v. Commissioner, 112 T.C. 19, 23 (1999).



     10
      We have interpreted the phrase “underlying tax liability”
in sec. 6330(d)(1) to include any amounts owed by a taxpayer
pursuant to the tax laws such as deficiencies, additions to tax,
and interest. Katz v. Commissioner, 115 T.C. 329, 339 (2000).
                              - 12 -

II.   Petitioner’s Challenges to the Notice of Determination

      The parties have stipulated the amount of the unreported

income petitioner embezzled that must be included in his income

for 1993.   The parties have also stipulated the resulting income

tax deficiency and penalty amounts.    Consequently, the parties

agree in effect to the amount of the underlying tax liability for

1993 before any adjustments for overpayments in nondetermination

years.

      The fundamental dispute focuses on alleged overpayments made

in nondetermination years that petitioner asserts should be

determined in this section 6320/6330 case and then applied to

offset the agreed-upon liability for 1993.    Petitioner did not

file refund claims with respect to the alleged overpayments as

required by the refund provisions of the Code and related

regulations within the applicable period of limitations set forth

in section 6511(a).   Petitioner attempts to overcome this problem

by introducing into evidence unsigned Forms 1040X claiming the

overpayments and asserting that we have jurisdiction in this

proceeding not only to determine overpayments but also to decide

that the mitigation provisions of sections 1311-1314 permit us to

do so.   Petitioner thus attempts to use this proceeding as a

“one-stop shop” for dispensing his brand of tax justice.    We

decline to do so for the reasons set forth herein.
                              - 13 -

III. Jurisdiction in Section 6320/6330 Proceedings To Determine
     Overpayments in Nondetermination Years

     Under section 6330(d)(1)(A), we have jurisdiction over the

determination made by the Appeals Office and our jurisdiction is

defined by the scope of that determination.    Freije v.

Commissioner, 125 T.C. 14, 25 (2005).    Under section 6330(c)(3),

the determination of the Appeals Office must take into account

the verification required by section 6330(c)(1), any relevant

issue relating to the unpaid tax or the proposed collection

action that was raised by the taxpayer under section 6330(c)(2),

and the balancing considerations required by section

6330(c)(3)(C).   “Since an ‘unpaid tax’ is the sine qua non of the

Commissioner’s authority to levy”, a claim directed at the status

of the tax as “unpaid” is a relevant issue relating to the unpaid

tax or the proposed collection action.    Id. at 26.   We have

stated in this regard as follows:

     Meaningful review of a claim that a tax sought to be
     collected by levy has been paid, by means of a
     remittance or an available credit, will typically
     require consideration of facts and issues in
     nondetermination years, as those years may constitute
     the years to which a remittance was applied or from
     which a credit originated. [Id. at 26-27; fn. ref.
     omitted.]

     In Frieje we held that we had jurisdiction to consider a

taxpayer’s claim that a payment made in the determination year

was misapplied to an earlier nondetermination year insofar as the

facts and issues with respect to the nondetermination year were
                              - 14 -

relevant to computing the unpaid tax for the determination year.

After examining the facts and circumstances surrounding the

remittance, we concluded that the Commissioner’s application of

the remittance to the earlier nondetermination year was proper.

     Our jurisdiction to consider relevant issues raised in a

section 6320 or 6330 proceeding is not unlimited, however.    If a

taxpayer asserts that an overpayment from a nondetermination year

should be applied to an unpaid tax liability for a determination

year, the taxpayer must demonstrate that he has acted timely in

asserting his claim to the refund or credit.   In Landry v.

Commissioner, 116 T.C. 60 (2001), we held that overpayments from

nondetermination years that were first claimed on delinquent

returns filed more than 3 years late did not reduce the amount of

unpaid tax due for the determination years because the refund

claims made on the delinquent returns were barred by the

applicable period of limitations governing refunds and credits.

See secs. 6511, 6513.   In Brady v. Commissioner, 136 T.C. ___

(2011), we held that alleged overpayments for nondetermination

years that the taxpayer had asserted on refund claims disallowed

by the Commissioner could not be credited against the unpaid tax

for the determination year because the taxpayer did not file a

refund suit to contest the disallowance within the period of

limitations set forth in section 6532.   These cases establish

that if we assume our jurisdiction in cases governed by section
                              - 15 -

6330 may permit us to consider overpayment claims arising from

nondetermination years, we may not credit against unpaid tax owed

for a determination year any alleged overpayment that is not

timely asserted or litigated as required by the refund provisions

of the Code.

     Petitioner made restitution payments during years after

1993, but he did not claim a deduction for the restitution

payments on his original returns for those years.    After

respondent initiated collection activity with respect to the

unpaid 1993 liability, petitioner belatedly attempted to claim

that he was entitled to deduct the restitution payments and that

he had overpaid his tax liabilities for years in which he made

restitution payments.   Petitioner did not file formal refund

claims with respect to the alleged overpayments, however.

Instead, he introduced into evidence unsigned and unfiled Forms

1040X with respect to the nondetermination years in which he had

paid restitution, arguing that he is entitled to credits against

his 1993 liability for the overpayments.

     Like the taxpayers in Landry and Brady, petitioner did not

take timely action to obtain credit or refund of overpayments

with respect to the nondetermination years.   Petitioner, however,

attempts to avoid the limitations problem by claiming that the

mitigation provisions of sections 1311-1314 apply.    As we

understand petitioner’s argument, he asserts that the provisions
                              - 16 -

apply because:   (1) The parties entered into a stipulation

regarding the amount of embezzlement income that was includable

in petitioner’s income for 1993 and that stipulation constitutes

a determination within the meaning of section 1313(a); (2) the

determination adopts a tax treatment of the embezzlement income

that is inconsistent with a different and erroneous tax position

involving the embezzlement income; (3) the connection between the

two inconsistent positions is described in section 1312; and (4)

the other tax years are closed for adjustment under the

applicable period of limitations.   Respondent disagrees.

Respondent asserts that petitioner does not correctly state the

conditions for mitigation; and that even if he did accurately

state the conditions, he failed to demonstrate that he met all of

the required conditions for mitigation to apply under sections

1311-1314.

     Congress enacted the mitigation provisions, presently

codified as sections 1311-1314, to provide relief for specified

errors and inconsistent positions in very limited circumstances.

Bradford v. Commissioner, 34 T.C. 1051, 1054 (1960); see also

Fong v. Commissioner, T.C. Memo. 1998-181.   The mitigation

provisions are detailed, and any party claiming the benefit of

the provisions must carry the burden of proving that the

provisions apply.   Bradford v. Commissioner, supra at 1054.
                             - 17 -

     Section 1311(a) provides:

           SEC. 1311(a). General Rule.--If a determination
     (as defined in section 1313) is described in one or
     more of the paragraphs of section 1312 and, on the date
     of the determination, correction of the effect of the
     error referred to in the applicable paragraph of
     section 1312 is prevented by the operation of any law
     or rule of law, other than this part and other than
     section 7122 (relating to compromises), then the effect
     of the error shall be corrected by an adjustment made
     in the amount and in the manner specified in section
     1314.

Under section 1313(a), a determination is (1) a decision by the

Tax Court or a judgment, decree, or other order by any court of

competent jurisdiction, which has become final; (2) a closing

agreement made under section 7121; (3) a final disposition by the

Secretary of a claim for refund; or (4) under regulations

prescribed by the Secretary, an agreement for purposes of this

part, signed by the Secretary and by any person, relating to the

liability of such person (or the person for whom he acts), in

respect of a tax under this subtitle for any taxable period.    The

circumstances under which an adjustment under section 1311 is

authorized are set forth in section 1312 and include such things

as the double inclusion of an item of gross income and the double

allowance or double disallowance of a deduction or credit.   Sec.

1312(1)-(7).

     Petitioner contends that the determination in question is

the parties’ stipulation that he was required to include in his
                                   - 18 -

1993 taxable income $17,872 of embezzlement income,11 which

petitioner asserts will ultimately be incorporated into a

decision and that it qualifies as a decision of the Tax Court

under section 1313(a)(1).        Petitioner also appears to contend

that the inconsistent position requiring mitigation is

respondent’s failure to allow deductions in the nondetermination

years for the amounts of restitution paid and to credit the

resulting overpayments against the 1993 liability.

     We reject petitioner’s mitigation argument for several

reasons.        First, petitioner has failed to prove that a qualifying

determination within the meaning of section 1313(a) has been

made.        Second, petitioner has failed to demonstrate any

circumstances described in section 1312 under which the

adjustment provided by section 1311 is authorized.        Third,

petitioner has failed to prove that the alleged overpayments

resulting from restitution payments made in the nondetermination

years are the result of any error in the prior tax treatment of

those payments or in the prior tax treatment of the embezzlement

income that generated the obligation to make the payments.         We

elaborate below.

     The only determination that petitioner identifies is the

stipulation of the parties regarding the amount of embezzled


        11
      Par. 1 of the second stipulation of settled issues
erroneously states that the taxable year is 2003, not 1993, but
the introductory language confirms that the correct year is 1993.
                               - 19 -

income includable in his 1993 income.   The stipulation has not

yet resulted in any decision, and it does not reflect a final

substantive decision on the merits of the case.   Ordinarily, in

order to qualify as a court decision, judgment, decree, or order

that has become final within the meaning of section 1313(a)(1), a

court action must involve a substantive decision on the merits.

See, e.g., Cotter v. Commissioner, 40 T.C. 506, 507-509 (1963).

An administrative settlement agreement is not a determination for

purposes of section 1313(a)(1).    See Fruit of the Loom, Inc. v.

Commissioner, 72 F.3d 1338 (7th Cir. 1996), affg. T.C. Memo.

1994-492; Rasmussen v. United States, 811 F.2d 949 (5th Cir.

1987).    However, a decision incorporating a stipulation of

settlement that specifies the tax treatment of an adjustment on

which mitigation is sought may qualify as a determination under

section 1313(a)(1).    See Shields v. United States, 265 F. Supp.

770 (N.D. Ohio 1965), affd. 375 F.2d 457 (6th Cir. 1967).

     Petitioner relies on Shields to support his argument that

the stipulation constitutes a determination within the meaning of

section 1313(a)(1).   Unlike the stipulation in Shields, the

stipulation in question has not been incorporated in any

decision, nor has there been a binding determination by this

Court that is final.12   We conclude that the stipulation is not a


     12
      Although neither party addressed this problem, it does not
appear that mitigation relief can be obtained in the same
                                                   (continued...)
                              - 20 -

qualifying determination under section 1313(a)(1) on the facts of

this case.

     We also reject petitioner’s contention that a circumstance

of adjustment described in section 1312 exists in this case.

Petitioner has not demonstrated that there has been an erroneous

double inclusion of the income embezzled by him, nor has he

proven that there has been any double disallowance of a proper

deduction with respect to the embezzled income.   Petitioner’s

position stated simply is that he has been required by the terms

of his sentence in the criminal case to pay restitution with

respect to the income he embezzled, he has paid some of the

required restitution, and he is entitled to deduct the

restitution payments, thereby generating overpayments in other

years that should offset his liability for the embezzled income.

Petitioner’s position does not reflect any inconsistency or

inequity in the tax treatment of either the embezzled income or

the restitution payments that can be cured by recourse to the

mitigation provisions.   We so hold.

     Because the mitigation provisions of sections 1311-1314 do

not apply, we hold that petitioner’s time-barred overpayment

claims for nondetermination years are not allowable as credits

against the 1993 liability.   Petitioner has raised no other


     12
      (...continued)
proceeding as that in which a determination is made.     Benenson v.
United States, 385 F.2d 26, 30-31 (2d Cir. 1967).
                              - 21 -

issues under section 6320 or 6330 with respect to the NFTL or the

proposed levy action.   We conclude, therefore, that the Appeals

Office did not abuse its discretion in determining that the

collection actions may proceed, and we sustain the determination.

    We have considered the remaining arguments of both parties

for results contrary to those discussed herein, and to the extent

not discussed above, conclude those arguments are irrelevant,

moot, or without merit.

     To reflect the foregoing,


                                         Decision will be entered

                                    for respondent.
