                        T.C. Memo. 2007-310



                      UNITED STATES TAX COURT



      PETER D. DAHLIN ATTORNEY AT LAW, P.S., Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 11555-05L.            Filed October 11, 2007.

          P filed a petition for judicial review pursuant to
     sec. 6330, I.R.C., in response to a determination by R
     that levy action is appropriate.

          Held: R’s determination to proceed with
     collection by levy is sustained.


     Robert E. Kovacevich, for petitioner.

     Catherine L. Campbell, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     WHERRY, Judge:   This case is before the Court on a petition

for judicial review of a Notice of Determination Concerning
                               - 2 -

Collection Action(s) Under Section 6320 and/or 6330.1     The issue

for decision is whether respondent may proceed with collection by

levy of petitioner’s 2000 corporate income tax.

                         FINDINGS OF FACT

     Some of the facts have been stipulated by the parties.     The

stipulations, with accompanying exhibits, are incorporated herein

by this reference.   At the time the petition was filed

petitioner’s principal place of business was located in Spokane,

Washington.

     Petitioner is a professional corporation incorporated under

the state laws of Washington, and is wholly owned by Peter Dahlin

(Mr. Dahlin), an attorney.   For taxable year 2000, petitioner

filed Form 1120-X, Amended U.S. Corporation Income Tax Return,

that reflected a tax liability of $1,463.

     On December 9, 2004, respondent mailed to petitioner a Final

Notice Of Intent To Levy And Notice Of Your Right To A Hearing,

which included, inter alia, petitioner’s 2000 corporate Federal

income tax.   Utilizing Form 12153, Request for a Collection Due

Process Hearing, petitioner timely requested a “CDP hearing face

to face with the hearing officer”, and stated its disagreement

with the assessment and levy of its corporate tax liability.

Petitioner also alleged mistakes in the computation of tax due


     1
      Unless otherwise indicated, all section references are to
the Internal Revenue Code of 1986, as amended, and all Rule
references are to the Tax Court Rules of Practice and Procedure.
                                - 3 -

and complained about “the failure to send 4340 forms with 23C

dates”.2

     On March 11, 2005, the Appeals officer assigned to

petitioner’s case, Kathleen Derrick (Ms. Derrick), mailed to

petitioner a letter entitled We Received Your Request for A

Collection Due Process Hearing And We Need To Advise You On

Procedures.    The letter informed petitioner that the issues

petitioner raised in its Appeals hearing request on Form 12153

were frivolous or groundless.    The letter provided:

     Appeals does not provide a face-to-face conference if
     the only items you wish to discuss are those mentioned
     above. You may, however, have a telephone conference
     or discuss with us by correspondence any relevant
     challenges to the filing of the notice of federal tax
     lien or the proposed levy.

     *     *     *    *    *

     If you are interested in receiving a face-to-face
     conference, you must be prepared to discuss issues
     relevant to paying your tax liability. These include,
     for example, offering other ways to pay the taxes you
     owe, such as an installment agreement or offer in
     compromise. The Internal Revenue Manuel determines
     whether Appeals can accept your proposal. If you wish
     to have a face-to-face conference, please write me
     within 15 days from the date of this letter and
     describe the legitimate issues you will discuss.

The letter further provided that petitioner was scheduled for a

telephonic hearing on March 30, 2005, at 10 a.m.    Additionally,

the letter instructed petitioner to fill out Form 433-B,


     2
      A “23C date” is the date on which the actual assessment of
the tax liability was made.
                               - 4 -

Collection Information Statement for Businesses, and return it by

March 28, 2005, so that collection options could be considered.

Ms. Derrick attached to the letter “literal transcripts” of

petitioner’s tax liability.

     In response, petitioner mailed a letter, dated March 24,

2005, to Ms. Derrick, which provided that petitioner was

requesting a “face to face conference” and “The legitimate issues

we wish to discuss are delay and issues of mishandling of this

matter.”   A telephonic hearing was held on March 30, 2005.   That

same day Ms. Derrick mailed to petitioner a letter that requested

specific documents and information that would facilitate the

Appeals Office’s determination as to whether petitioner was

entitled to a face-to-face hearing.    The letter requested, inter

alia, that petitioner complete and return Form 433-B, a copy of

which was attached, and explain with supporting documentation why

petitioner did “not owe a tax liability for the Form 1120 for the

tax year 2000.”   The letter informed petitioner that if

Ms. Derrick did not receive the relevant information by April 13,

2005,3 she would issue a notice of determination.   As of April

18, 2005, petitioner had not provided the requested information.

     On May 20, 2005, respondent mailed to petitioner the above-

mentioned Notice of Determination Concerning Collection Action(s)


     3
      The letter actually stated the date as Apr. 13, 2004, which
was a typographical error as the letter was dated Mar. 30, 2005.
                               - 5 -

Under Section 6320 and/or 6330.   The notice of determination

provided in pertinent part:

     We advised that some of the issues raised in your
     appeal were of a frivolous nature. We advised that
     this was your opportunity to discuss why you believed
     you did not owe the tax and/or why you could not pay
     the tax liability. You advised that you believe you
     were assessed additional tax because your election for
     S-corporation status was denied. You stated that you
     believed that the denial was in error and that the IRS
     granted this status in 1999. Your representative
     advised that you could not pay the tax because you had
     received threats on your life.[4] You have not advised
     as to how the alleged death threats have impacted your
     ability to pay the tax liability.

The notice of determination stated that petitioner did not

provide the requested information and documentation to Ms.

Derrick.   It further provided that “Although a levy is intrusive,

you have not provided financial data that would allow our office

to consider a viable collection alternative”.   The Form 4340,

Certificate of Assessments, Payments, and Other Specified

Matters, for taxable year 2000, attached as an exhibit to the

joint stipulation of facts in this case, was not obtained until

after the notice of determination was issued.   Petitioner filed a


     4
      Mr. Dahlin’s former legal assistant and office manager
solicited a “hitman” to murder him. Respondent objected, based
on relevancy, to the admission into evidence of a newspaper
article that discussed the solicitation of first degree murder by
Mr. Dahlin’s former employee and the subsequent trial. See Fed.
R. Evid. 401. The Court concludes that while the relevancy of
the newspaper article is certainly limited, it meets the
threshold definition of relevant evidence and is admissible. The
Court will give the article only such consideration as is
warranted by its pertinence to the Court’s analysis of the case.
                                 - 6 -

timely petition, and a trial was held on June 13, 2006, in

Spokane, Washington.5

                                OPINION

I.   General Rules

     Pursuant to section 6331(a), if a taxpayer liable to pay

taxes fails to do so within 10 days after notice and demand for

payment, the Secretary is authorized to collect such tax by levy

upon the taxpayer’s property.    The Secretary is obliged to

provide the taxpayer with 30 days’ advance notice of levy and to

include in the notice information regarding the administrative

appeals available to the taxpayer.       Sec. 6331(d)(2), (4).

Section 6330 elaborates on section 6331 and provides that upon a

timely request a taxpayer is entitled to a collection hearing

before the IRS Office of Appeals.     Sec. 6330(a)(3)(B), (b)(1).

     At the collection hearing, the taxpayer may raise “any

relevant issue relating to the unpaid tax or the proposed levy,”

including appropriate spousal defenses, challenges to the

appropriateness of collection actions, and offers of collection

alternatives.   Sec. 6330(c)(2)(A).      The taxpayer may not contest

the validity of the underlying tax liability unless the taxpayer

did not receive a notice of deficiency for such tax liability or




     5
      At trial, petitioner admitted that “we’re not challenging
the deficiency, but we did want to get current information.”
                               - 7 -

did not otherwise have an opportunity to dispute the tax

liability.   Sec. 6330(c)(2)(B).

     In rendering a determination, the Appeals officer must

verify that the requirements of any applicable law and

administrative procedure have been met.    Also, the Appeals

officer must consider and weigh relevant issues relating to the

unpaid tax or proposed levy, and “whether any proposed collection

action balances the need for the efficient collection of taxes

with the legitimate concern of the person that any collection

action be no more intrusive than necessary.”    Sec. 6330(c)(3)(B)

and (C).

     The taxpayer is entitled to appeal the determination of the

Appeals Office if it was made on or before October 16, 2006, to

the Tax Court or a U.S. District Court, depending on the type of

tax at issue.   Sec. 6330(d)(1).6   Where the validity of the

underlying tax liability is properly at issue, the Court will

review the matter de novo.   Sego v. Commissioner, 114 T.C. 604,

610 (2000); Goza v. Commissioner, 114 T.C. 176, 181-182 (2000).

The Court reviews any other administrative determination

regarding the proposed levy action for an abuse of discretion.

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

at 182.


     6
      Determinations made after Oct. 16, 2006, are appealable
only to the Tax Court. See Pension Protection Act of 2006, Pub.
L. 109-280, sec. 855, 120 Stat. 1019.
                               - 8 -

II.   Appeals Hearing

      Petitioner contends that it was entitled to a face-to-face

hearing because the regulations promulgated under section 6330 so

provide.   Section 301.6330-1(d)(2), Q&A-D7,7 Proced. & Admin.

Regs., provides:

      Q-D7. If a taxpayer wants a face-to-face CDP hearing,
      where will it be held?

      A-D7. The taxpayer must be offered an opportunity for
      a hearing at the Appeals office closest to taxpayer’s
      residence or, in the case of a business taxpayer, the
      taxpayer’s principal place of business. If that is not
      satisfactory to the taxpayer, the taxpayer will be
      given an opportunity for a hearing by correspondence or
      by telephone. If that is not satisfactory to the
      taxpayer, the Appeals officer or employee will review
      the taxpayer’s request for a CDP hearing, the case
      file, any other written communications from the
      taxpayer (including written communications, if any,
      submitted in connection with the CDP hearing), and any
      notes of any oral communications with the taxpayer or
      the taxpayer’s representative. Under such
      circumstances, review of those documents will
      constitute the CDP hearing for the purposes of section
      6330(b).




      7
      Sec. 301.6330-1(d)(2), Q&A-D7, Proced. & Admin. Regs., was
revised in regard to the provision of face-to-face Appeals
hearings. Effective Nov. 16, 2006, it provides that “a taxpayer
who presents in the CDP hearing request relevant, non-frivolous
reasons for disagreement with the proposed levy will ordinarily
be offered an opportunity for a face-to-face conference at the
Appeals office closest to taxpayer's residence.” See sec.
301.6330-1(d)(2), Q&A-D7, Proced. & Admin. Regs. The revised
regulations promulgated under sec. 6330 further provide that a
face-to-face hearing will not be provided “if the request for a
hearing or other taxpayer communication indicates that the
taxpayer wishes only to raise irrelevant or frivolous issues”.
See sec. 301.6330-1(d)(2), Q&A-D8, Proced. & Admin. Regs.
                               - 9 -

     However, this Court has held that once a taxpayer has been

given a reasonable opportunity for a hearing but has failed to

avail himself of that opportunity, then the Commissioner may make

a determination to proceed with collection based upon a review of

the case file.   See Lunsford v. Commissioner, 117 T.C. 183, 189-

190 (2001); Carrillo v. Commissioner, T.C. Memo. 2005-290.

“Thus, a face-to-face meeting is not invariably required.”

Carrillo v. Commissioner, supra; see Wright v. Commissioner, T.C.

Memo. 2005-291; Gougler v. Commissioner, T.C. Memo. 2002-185.

     In the instant case, Ms. Derrick provided petitioner an

opportunity to have a face-to-face hearing, provided that

petitioner submitted a written explanation of the relevant issues

to be discussed, Form 433-B, and other relevant documentation.

Petitioner’s written explanation failed to raise any issues

relevant to the underlying 2000 Federal corporate income tax

liability or the collection of that tax liability, providing only

that “the legitimate issues we wish to discuss are delay and

issues of mishandling of this matter”.   Petitioner failed to

submit Form 433-B and the other requested documentation.    The

Court concludes that petitioner was afforded a reasonable

opportunity for a face-to-face hearing but failed to avail itself

of that opportunity.

       At trial, petitioner was afforded an opportunity to

identify any legitimate issues it wished to raise that could
                                - 10 -

warrant further consideration of the merits of its case by the

Appeals Office or this Court.    Petitioner focused its argument on

the fact that it was not provided a face-to-face hearing, nor

Form 4340 with a 23C date prior to the issuance of the notice of

determination, as requested.    The Court concludes that all

pertinent issues relating to the underlying corporate tax

liability and the propriety of the collection determination can

be decided based on the present record.

III. Standard of Review

     At issue in this case is respondent’s right to collect

petitioner’s self-determined tax liability for 2000 (i.e., the

amount set forth on petitioner’s filed 2000 Form 1120-X).      A

taxpayer’s challenge to his self-determined tax liability at an

Appeals Office hearing constitutes a permissible challenge to the

underlying tax liability under section 6330(c)(2)(B).     Montgomery

v. Commissioner, 122 T.C. 1, 9 (2004).     Petitioner contends that

this Court should review the instant case de novo, stating:        “The

Petitioner filed the 1120 tax return and self-assessed the tax

without any judicial determination.”     However, petitioner is not

disputing the accuracy of its self-determined tax liability.       See

supra note 4.   Instead, petitioner argues that it should have had

a face-to-face hearing, with which the Court has already

indicated its disagreement, and, as discussed and addressed
                              - 11 -

below, that it should have been provided with a Form 4340 that

contained a 23C date.

     It appears that petitioner’s claim does not require a

determination under section 6330(c)(2)(B) relating to the

existence or amount of the underlying tax liability entitled to

de novo review, but rather it requires a section 6330(c)(2)(A)

determination relating to an “unpaid tax” subject to review for

abuse of discretion.8   Accordingly, the Court will review the

administrative record of the levy for an abuse of discretion.9

An abuse of discretion has occurred if the “Commissioner

exercised * * * [his] discretion arbitrarily, capriciously, or

without sound basis in fact or law.”   Woodral v. Commissioner,

112 T.C. 19, 23 (1999).

     Federal tax assessments are formally recorded on a record of

assessment in accordance with section 6203.   The Commissioner is

not required to use Form 23C in making an assessment.   Roberts v.

Commissioner, 118 T.C. 365, 371 (2002), affd. 329 F.3d 1224 (11th

Cir. 2003).   Furthermore, section 6330(c)(1) mandates neither


     8
      Petitioner expressed concern with the calculation of
interest on its Federal corporate income tax. The Court notes
that its authority to redetermine interest, pursuant to sec. 7481
and Rule 261, is based on a chronology that places the resolution
of unpaid interest on a deficiency after the entry of decision.
Accordingly, the Court lacks jurisdiction to redetermine interest
at this time.
     9
      The Court notes that it would also sustain respondent’s
determination to proceed with collection action even under a de
novo standard of review.
                               - 12 -

that the Appeals officer rely on a particular document in

satisfying the verification requirement nor that the Appeals

officer actually give the taxpayer a copy of the verification

upon which he or she relied.    Craig v. Commissioner, 119 T.C.

252, 262 (2002); Nestor v. Commissioner, 118 T.C. 162, 166

(2002).

     A Form 4340, for instance, constitutes presumptive evidence

that a tax has been validly assessed pursuant to section 6203.

Davis v. Commissioner, 115 T.C. 35, 40 (2000) (and cases cited

thereat).   Consequently, absent a showing by the taxpayer of some

irregularity in the assessment procedure that would raise a

question about the validity of the assessments, a Form 4340

reflecting that tax liabilities were assessed and remain unpaid

is sufficient to support collection under section 6330.     Id. at

40-41.    This Court has specifically held that it is not an abuse

of discretion for an Appeals officer to rely on Form 4340 to

comply with section 6330(c)(1).     Nestor v. Commissioner, supra;

Davis v. Commissioner, supra at 41.     Similarly, it is not an

abuse of discretion for an Appeals officer to rely on a computer

transcript of account to comply with section 6330(c)(1).

Schroeder v. Commissioner, T.C. Memo. 2002-190; Mann v.

Commissioner, T.C. Memo. 2002-48.

     Ms. Derrick relied on computer transcripts of petitioner’s

account in verifying that all applicable law and administrative
                                - 13 -

procedures had been met, which is not an abuse of discretion.

The record now contains Form 4340 for taxable year 2000, which

indicates that an assessment was made for 2000 and that taxes

remain unpaid.   Petitioner has cited no irregularities that would

cast doubt on the pertinent liability information recorded on

Form 4340.

     In addition to the specific dictates of section 6330, the

Secretary, upon request, is directed to furnish to the taxpayer a

copy of pertinent parts of the record of assessment setting forth

the taxpayer’s name, the date of assessment, the character of the

liability assessed, the taxable period, if applicable, and the

amounts assessed.     Sec. 6203; sec. 301.6203-1, Proced. & Admin.

Regs.   A taxpayer receiving a copy of Form 4340 has been provided

with all the documentation to which he or she is entitled under

section 6203 and section 301.6203-1, Proced. & Admin. Regs.

Roberts v. Commissioner, supra at 370 n.7.     This Court has

likewise upheld collection actions where taxpayers were provided

with literal transcripts of account (so-called MFTRAX).    See

Frank v. Commissioner, T.C. Memo. 2003-88; Swann v. Commissioner,

T.C. Memo. 2003-70.    Ms. Derrick mailed to petitioner literal

transcripts prior to the telephonic hearing, and petitioner was

provided with Form 4340 subsequent to the telephonic hearing and

issuance of the notice of determination, but prior to trial.
                               - 14 -

       Petitioner argues, relying on Huff v. United States, 10 F.3d

1440 (9th Cir. 1993), that if requested, section 6203 requires

copies of Forms 4340 with 23C dates to be given to the

taxpayer.10   However, Huff v. United States, supra at 1446, held

that

       Given the defect in the Forms 4340 [lack of 23C date on
       Mr. Huff’s Form 4340] and the fact that the record
       contains no evidence indicating that the Huffs received
       copies of their assessments pursuant to their request
       under section 6203, we conclude there are genuine
       issues of material fact as to whether the IRS has
       complied with the requirements of section 6203.

The court in Huff v. United States, supra, did not mandate that

Form 4340 must be furnished to all taxpayers who so request it in

order for section 6203 to be satisfied.    Instead, it found that

there were genuine issues of material fact as to whether section

6203 was satisfied in that particular case, due to one Form 4340

lacking a 23C date and the Commissioner’s failing to provide

requested assessments to the taxpayers.    Petitioner’s reliance on

Huff v. United States, supra, is misplaced.    Accordingly, this

Court concludes that section 6203 was satisfied in the instant

case and respondent did not abuse his discretion by providing

petitioner with computer-generated transcripts instead of



       10
      Pursuant to Golsen v. Commissioner, 54 T.C. 742, 757
(1970), affd. 445 F.2d 985 (10th Cir. 1971), this Court will
follow the precedent established in the court to which an appeal
would lie. Appeal in the instant case would normally lie, absent
stipulation to the contrary, with the Court of Appeals for the
Ninth Circuit.
                              - 15 -

Form 4340.   The Court sustains respondent’s determination to

proceed with collection by levy.

     The Court has considered all of the petitioner’s

contentions, arguments, requests, and statements.     To the extent

not discussed herein, the Court concludes that they are

meritless, moot, or irrelevant.

     To reflect the foregoing,


                                         Decision will be entered

                                    for respondent.
