                            116 T.C. No. 22



                     UNITED STATES TAX COURT



    ESTATE OF EDWARD WENNER, DECEASED, MERLYN WENNER RUDDELL,
       KATE WENNER EISNER AND JANN S. WENNER, CO-EXECUTORS,
   AND DALLAS CLARK, f.k.a. DOROTHY E. WENNER, Petitioners v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 12611-99.             Filed May 14, 2001.

          Ps petitioned the Court for a review of R’s
     determination not to abate interest under sec. 6404.
     In the petition C, one of the Ps, raised a claim for
     relief from joint liability on a joint return pursuant
     to sec. 6015 (sec. 6015 claim).
          R moved to strike the sec. 6015 claim, asserting
     the Court lacked jurisdiction to determine such a claim
     in a sec. 6404 proceeding.
          Held: C’s sec. 6015 claim is an affirmative
     defense in a matter properly before the Court. In such
     circumstances, we require no additional statutory
     jurisdiction to address and determine C’s claim for
     sec. 6015 relief.


     Michael L. Sandford, for petitioners.

     Michael P. Breton, Bradford A. Johnson, and Gary Slavett,

for respondent.
                               - 2 -


                              OPINION


     LARO,   Judge: Petitioners petitioned the Court to review

respondent’s determination not to abate interest pursuant to

section 6404.1   Petitioner Dallas Clark also alleges in the

petition that she should be relieved from joint liability as to

Federal income tax returns which she filed with her now deceased

husband for the relevant years.    We must decide whether the Court

has jurisdiction to decide Ms. Clark’s claim as to joint

liability.   We hold that we have jurisdiction.

                            Background

     Edward Wenner died in 1988.    On or about March 1990 Kate

Wenner Eisner, acting for the estate, and Ms. Clark executed a

Form 870-P, Agreement to Assessment and Collection of Deficiency

in Tax for Partnership Adjustments.     On September 29, 1997,

respondent sent to Edward (then deceased) and Dorothy Wenner

(now Ms. Clark) notices of changes to their 1982, 1983, and 1984

joint Federal income tax returns.    Those changes resulted from an

examination of those returns and the related partnership returns.

Respondent increased the amount of tax for each of the years and

claimed interest in the following amounts:




     1
      Unless otherwise indicated, section references are to the
Internal Revenue Code in effect for the years in issue.
                               - 3 -

          Year    Increase in Tax        Interest Charged
          1982         $5,410               $22,290.18
          1983          5,763                20,992.39
          1984            366                   821.45

     On or about February 12, 1998, Ms. Clark, on behalf of all

petitioners, paid respondent the $11,539 in taxes specified in

the notices.

     Sometime after receiving the September 29, 1997, notices,

petitioners requested that respondent abate the interest charged.

On January 20, 1999, respondent notified Ms. Clark that the claim

for abatement of interest under section 6404(e) was disallowed.

On July 16, 1999, petitioners filed a timely petition for Review

of Denial of Request for Abatement of Interest.    In that petition

Ms. Clark also requested she be relieved from joint liability as

to the relevant years.

     Respondent moved to strike Ms. Clark’s claim for relief from

joint liability from the petition.     Respondent asserts that the

Court lacks jurisdiction with regard to that claim.    Petitioners

opposed that motion.   Respondent responded stating in part:

“After a diligent search of our records, respondent has

determined that no claim or election for relief under I.R.C. §

6015 (b) or (c) was filed by petitioner Ms. Clark, f.k.a. Dorothy

E. Wenner, with the Internal Revenue Service in accordance with

normal procedures.”
                               - 4 -

                            Discussion

     This is a matter of first impression.   The issue we must

decide is whether we have jurisdiction to decide an affirmative

defense under section 6015 pled in a section 6404 petition for

judicial review of respondent’s determination not to abate

interest.   We first turn to this Court’s jurisdiction.

     Referring to this Court, the Court of Appeals for the

Seventh Circuit recently noted “[the Tax Court], like all Federal

Courts, is a court of limited jurisdiction.”   Flight Attendants

Against UAL Offset v. Commissioner, 165 F.3d 572, 578 (7th Cir.

1999).   The Tax Court has specialized jurisdiction and may

exercise it only to the extent authorized by Congress.    See

Naftel v. Commissioner, 85 T.C. 527, 529 (1985).   The question of

the Court’s jurisdiction is fundamental and must be addressed

when raised by a party. See id. at 530.   The Court’s jurisdiction

to review respondent’s determination whether to abate interest is

now found in section 6404(i) (formerly designated as section

6404(g)).   That section, so far as is relevant, provides:


     (i) Review of Denial of Request for Abatement of
     Interest. –-
          (1) In general.--The Tax Court shall have
     jurisdiction over any action brought by a taxpayer who
     meets the requirements referred to in section
     7430(c)(4)(A)(ii) to determine whether the Secretary’s
     failure to abate interest under this section was an
     abuse of discretion, and may order an abatement, if
     such action is brought within 180 days after the date
     of the mailing of the Secretary’s final determination
     not to abate such interest. [Emphasis added.]

     Section 6404(i) clearly grants the Court jurisdiction to
                               - 5 -

review the Commissioner’s failure to abate interest under all

subsections of section 6404.   See Woodral v. Commissioner, 112

T.C. 19, 22-23 (1999).   However, the only explicit jurisdiction

given to the Court under this section is a jurisdiction to

determine whether the Secretary’s failure to abate interest under

section 6404 was an abuse of discretion.   The Court may order an

abatement of interest where we have determined that the Secretary

has abused his discretion.

     There are two primary jurisdictional predicates for this

Court to review a claim for relief from joint and several

liability.   First, a claim may be raised as an affirmative

defense in a petition for redetermination of a deficiency filed

pursuant to section 6213(a).   See Butler v. Commissioner, 114

T.C. 276 (2000); Charlton v. Commissioner, 114 T.C. 333 (2000).

In a deficiency proceeding, we consider all the facts and

circumstances relevant to ascertaining the correct amount of the

deficiency, including affirmative defenses.   See secs. 6213 and

6214; Butler v. Commissioner, supra at 287; Woods v.

Commissioner, 92 T.C. 776, 784-785 (1989); Naftel v.

Commissioner, 85 T.C. 527, 533 (1985).

     The second jurisdictional predicate is found in section

6015(e).   This section enables an electing spouse to petition for

review of an administrative determination (or failure to make a

determination) regarding relief from liability as a stand alone
                              - 6 -

matter, independent of any deficiency proceeding.    See Fernandez

v. Commissioner, 114 T.C. 324 (2000).

     The essence of Ms. Clark’s argument is that she is entitled

to raise her entitlement to section 6015 relief as an affirmative

defense in a section 6404 action.    Ms. Clark asserts that there

is sufficient jurisdictional predicate for this Court to

determine her substantive claim.    Historically we have

characterized a claim for relief from joint liability as an

affirmative defense that must be set forth in the pleadings.      See

Butler v. Commissioner, supra at 287-288.

     In Neely v. Commissioner, 115 T.C. 287 (2000), an analogous

case, we held that we had jurisdiction to decide an affirmative

defense raised by the petitioner in a section 7436 case

(Proceedings for Determination of Employment Status).      Section

7436, like section 6404, allows judicial review of a

determination of the respondent.    In that case we reasoned:

        The statute of limitations set forth in section 6501
     constitutes a defense at bar (i.e., an affirmative
     defense) that may be raised by the taxpayer in response
     to a determination made by the Commissioner. See Rule
     39; Genesis Oil & Gas, Ltd. v. Commissioner, [93 T.C.
     562 (1989)] supra at 564. Once our jurisdiction has
     been properly invoked in a case, we require no
     additional jurisdiction to render a decision with
     respect to such an affirmative defense. See Genesis Oil
     & Gas, Ltd. v. Commissioner, supra at 564. Rather,
     “When such a defense in bar is properly raised, we must
     pass upon the merits of the issue after receiving
     evidence with respect thereto”. Badger Materials, Inc.
     v. Commissioner, [40 T.C. 1061 (1963)] supra at 1063.
     Accordingly, we hold that where the parties are
     properly before the Court in an action brought under
     section 7436, the Court possesses jurisdiction to
     address issues relating to the period of limitations
                               - 7 -

     under section 6501 that are properly raised by the
     parties.
        In this case, our jurisdiction over the parties under
     section 7436 was invoked through petitioner’s timely filed
     petition seeking review of respondent’s notice of
     determination. When petitioner pleaded as an affirmative
     defense in his petition that respondent’s determination as
     to worker classification was barred by expiration of the 3-
     year period of limitations under section 6501(a), we
     required no additional jurisdiction to address such issue.
     * * *

Id. at 292-293.

     As a stand alone proceeding, the Court has no jurisdiction

to consider a request for relief from joint liability on a joint

return under section 6015 unless the following three requirements

are met:   (1) The taxpayer has filed a timely election pursuant

to section 6015, (2) respondent has notified the taxpayer that

respondent has denied the taxpayer’s request for relief under

that section, and (3) the taxpayer has timely petitioned this

Court for relief under section 6015(e)(1).   See sec. 6015.   The

record here discloses that none of the procedural requirements

for our jurisdiction under section 6015(e) has been satisfied.

     However, we can find no compelling reason to distinguish the

logic and reasoning of this Court in Neely v. Commissioner,

supra.   An entitlement to the statutory relief provided by

section 6015 is no less a defense to respondent’s determination

than the statutory relief provided by section 6501(a) in the

Neely case.   There, as in the instant case, an affirmative

defense was pleaded in a matter properly before the Court.

Petitioner’s petition under section 6404 is properly before the
                                 - 8 -

Court, and we hold we require no additional jurisdiction to

address Ms. Clark’s claim for section 6015 relief.2       Consequently

we shall deny respondent’s motion to strike paragraph 16 from the

petition and paragraph 2 of petitioners’ prayer for relief.

     To reflect the foregoing,

                                         An appropriate order will

                                 be issued.




     2
      We, however, do not have jurisdiction over the correctness
of the underlying deficiency determination in the instant
proceeding.
