       RENALD EICHLER, PETITIONER v. COMMISSIONER
           OF INTERNAL REVENUE, RESPONDENT

         Docket No. 725–12L.              Filed July 23, 2014.

       After R assessed trust fund recovery penalties against him,
     P requested a partial pay installment agreement. Before P’s
     request had been input into the IRS computer system or acted
     upon, R sent P Letters CP 90, Final Notice—Notice of Intent
     to Levy and Notice of Your Right to a Hearing. P timely
     requested a collection due process (CDP) hearing, renewing
     his request for an installment agreement and asserting that
     the Letters CP 90 should be withdrawn as invalid pursuant

30
(30)                  EICHLER v. COMMISSIONER                            31


       to I.R.C. sec. 6331(k)(2), which prohibits the IRS from making
       a levy while an offer for an installment agreement is pending.
       During the CDP hearing R’s settlement officer conditioned
       acceptance of an installment agreement on P’s making an
       $8,520 downpayment. P declined this proposal as resulting in
       economic hardship. R’s final determination sustained the pro-
       posed levy on the ground that P had declined R’s proposed
       installment agreement; it rejected P’s request that the Letters
       CP 90 be withdrawn as invalid. Held: I.R.C. sec. 6331(k)(2)
       did not preclude R from issuing the Letters CP 90 after P sub-
       mitted his offer for an installment agreement. Held, further,
       R’s determination not to rescind the Letters CP 90 was not an
       abuse of discretion under relevant provisions of the Internal
       Revenue Manual. Held, further, because the record does not
       allow for meaningful review of R’s determination regarding
       the appropriateness of the $8,520 downpayment as a condition
       of an installment agreement, this case will be remanded for
       further proceedings.

  Mark Harrington Westlake, for petitioner.
  John R. Bampfield, for respondent.

                                 OPINION

  THORNTON, Chief Judge: Petitioner seeks review pursuant
to section 6330(d) of respondent’s determination sustaining a
proposed levy. 1 This case is before us on the parties’ cross-
motions for summary judgment.

                               Background
  The record reveals or the parties do not dispute the fol-
lowing.
  When he filed his petition, petitioner lived in Tennessee.
On December 20, 2010, respondent assessed against him
these section 6672 trust fund recovery penalties: $89,760 for
the fourth quarter of 2008, $82,725 for the first quarter of
2009, and $16,889 for the second quarter of 2009.
  By letter dated April 11, 2011, petitioner’s representative,
Mark Harrington Westlake, sent to the Internal Revenue
Service’s (IRS) Service Center in Atlanta, Georgia, a letter
requesting, among other things, a ‘‘partial payment install-
  1 Unless otherwise indicated, all section references are to the Internal
Revenue Code in effect at all relevant times, and all Rule references are
to the Tax Court Rules of Practice and Procedure. All monetary amounts
are rounded to the nearest dollar.
32           143 UNITED STATES TAX COURT REPORTS                       (30)


ment agreement’’ of $350 per month for the three quarters
previously mentioned as well as the fourth quarter of 2007.
This letter was accompanied by a completed and signed Form
433–A, Collection Information Statement for Wage Earners
and Self-Employed Individuals, and supporting financial
documentation.
  On April 28, 2011, respondent received petitioner’s
request. 2 Pursuant to Internal Revenue Manual (IRM) pt.
5.14.1.3 (Mar. 4, 2011), the IRS Collection Division is
required to input certain codes—‘‘TC 971 AC 043’’ for install-
ment agreement requests not immediately approved and ‘‘TC
971 AC 063’’ for requests immediately approved—into the
IRS computer system within 24 hours of receiving an install-
ment agreement request if it meets certain requirements.
Although petitioner’s request met these requirements, the
IRS Collection Division failed to input any code until June 6,
2011, when the ‘‘TC 971 AC 043’’ code was input.
  In the meantime, on May 9, 2011, respondent had sent to
petitioner three Letters CP 90, Final Notice—Notice of Intent
to Levy and Notice of Your Right to a Hearing (notices of
intent to levy), with respect to petitioner’s unpaid trust fund
recovery penalties for the last quarter of 2008 and first two
quarters of 2009. 3
  On May 13, 2011, the IRS Service Center in Atlanta,
Georgia, sent petitioner a letter in response to the install-
ment agreement request, stating:
  We have not resolved this matter because we haven’t completed all the
  processing necessary for a complete response. However, we will contact
  you again within 45 days with our reply. You don’t need to do anything
  further now on this matter.

                        *   *   *   *   *   *    *
  We’ve delayed sending you further notices while we research this
  matter. If you receive or have received additional notices * * *, please
  contact us.


  2 The  record does not show why petitioner’s April 11, 2011, letter took
17 days to reach respondent.
  3 The notices of intent to levy referenced Publication 594, The IRS Col-

lection Process. Publication 594 explains, among other things, that the IRS
is prohibited from levying against a taxpayer’s property while an install-
ment agreement request ‘‘is being considered’’.
(30)                  EICHLER v. COMMISSIONER                              33


This May 13, 2011, letter erroneously stated that it was in
reference to petitioner’s 2008 Federal income tax rather than
the trust fund recovery penalties at issue in this case.
  On June 1, 2011, the Office of Appeals (Appeals) received
a timely Form 12153, Request for a Collection Due Process
or Equivalent Hearing, from petitioner indicating the fol-
lowing reason for his request:
  I previously submitted Form 433–A with supporting documentation and
  a request for an installment agreement. (Copy attached) The Final
  Notice (CP 90) was issued prematurely. I request that the Final Notice
  be withdrawn and that the installment payment agreement I requested
  be implemented. In the alternative I REQUEST AN IN PERSON
  HEARING IN NASHVILLE, TN.

By cover letter accompanying the Form 12153 petitioner
asserted that the notices of intent to levy should be with-
drawn pursuant to section 6331(k) and IRM pt. 5.11.1.2.2.8
(Jan. 1, 2006).
  On September 1, 2011, an IRS settlement officer, Suzanne
Magee (SO Magee), notified petitioner that she was in receipt
of his request for an Appeals hearing and that she had
scheduled an in-person conference for October 4, 2011.
  On September 26, 2011, Mr. Westlake sent SO Magee a
letter asserting that petitioner’s installment agreement
request had been submitted and was pending when the
notices of intent to levy had been issued. Mr. Westlake
requested that the notices be rescinded. He also stated:
  Please note that since the prior Form 433–A was submitted the tax-
  payers have become obligated for two additional court ordered payments
  on judgments. Moreover, they continue to receive dunning notices
  from many of the unsecured creditors shown on the exhibit to the Form
  433–A. I am hopeful that my correspondence to those creditors will per-
  suade them that filing further lawsuits will be futile.
  Dr. Renald Eichler is 76 years of age and Dr. Priscilla Eichler is 71
  years of age.
  They have lived in their home since 1971. The current indebtedness
  against the home, i.e., $720,000 was incurred in an effort to prop up the
  non-profit educational corporation for which both of them worked. Those
  efforts were unsuccessful. The non-profit corporation itself lost its assets
  in foreclosure. I believe that it may have attempted a reorganization
  before it closed.
  We had originally requested a partial payment installment agreement in
  the amount of $350 per month. However, the taxpayers’ financial situa-
34             143 UNITED STATES TAX COURT REPORTS                                (30)

 tion has deteriorated and accordingly, we are now requesting that the
 accounts be designated ‘‘Currently Not Collectible.’’

Mr. Westlake also submitted with the letter a completed
Form 433–A and supporting financial documentation. The
Form 433–A reflected total gross monthly income of $5,464,
of which $3,079 was attributable to petitioner and $2,385
was attributable to his wife. 4 The Form 433–A reported
monthly expenses of $5,573, including the following:
                  Expense                                                Amount
       Food, clothing, & misc. ......................................      $985
       Housing and utilities .........................................    3,500
       Vehicle operating costs ......................................       488
       Health insurance—Humana .............................                112
       Out-of-pocket healthcare costs .........................             288
       Court-ordered payments ...................................           200
       Taxes (income and FICA) .................................            212

The Form 433–A also reported debts of approximately
$260,000 ‘‘on credit cards and store accounts and judgments.’’
  On October 4, 2011, SO Magee conducted an in-person con-
ference with petitioner, petitioner’s wife, and Mr. Westlake.
At the hearing Mr. Westlake once again argued that the
notices of intent to levy had been issued prematurely because
petitioner had submitted an installment agreement offer that
was pending when the notices were issued. SO Magee deter-
mined that the issuance of the notices of intent to levy was
not premature and that these notices should not be
rescinded. After discussing potential collection alternatives,
SO Magee requested additional supporting documentation.
  On October 17, 2011, petitioner provided the requested
supporting documentation to SO Magee. By cover letter Mr.
Westlake renewed his objection that the notices of intent to
levy had been issued prematurely and that they should be
rescinded. He also requested a $25-per-month installment
agreement as a collection alternative to the proposed levy.
  On October 19, 2011, after reviewing petitioner’s docu-
mentation, SO Magee phoned Mr. Westlake and left him a
voicemail message, requesting certain bank statements to
substantiate some of petitioner’s expenses and indicating
that the notices of intent to levy would not be rescinded.
 4 Petitioner’s   wife is not a party to this proceeding.
(30)              EICHLER v. COMMISSIONER                    35


   On October 26, 2012, Mr. Westlake provided the requested
bank statements to SO Magee. A joint bank account peti-
tioner shared with his wife showed a balance of $15,214 as
of October 20, 2011. Mr. Westlake again renewed his request
for a $25-per-month installment agreement and rescission of
the notices of intent to levy.
   SO Magee reviewed petitioner’s Form 433–A and sup-
porting financial documentation. She concluded that an
appropriate collection alternative would be an installment
agreement of $25 per month for one year increasing to $734
per month in November 2012, provided that petitioner also
submitted with his installment agreement a downpayment of
$8,520.
   On October 28, 2011, SO Magee called Mr. Westlake to
confirm receipt of the additional financial documentation.
She also communicated to Mr. Westlake her proposed install-
ment agreement collection alternative to the proposed levy.
   By letter dated November 8, 2011, Mr. Westlake agreed to
SO Magee’s proposal that petitioner pay $25 per month,
increasing to $734 per month in November 2012. He dis-
agreed, however, that petitioner should be required to make
an $8,520 downpayment, stating: ‘‘Please refer to my prior
correspondence explaining that $15,000 had originally been
borrowed from family members. I have since confirmed that
the funds were loaned to Mrs. Eichler by her sister. Repay-
ment of that loan would fully deplete the savings account.’’
He also indicated that if SO Magee was ‘‘unable or unwilling
to accept the proposed $25 per month installment agreement
with an automatic twelve month increase, but without the
initial $8,520 payment and with the rescission of the [notices
of intent to levy] * * *, please issue your final determina-
tion’’.
   On December 8, 2011, Appeals issued to petitioner a Notice
of Determination Concerning Collection Action(s) Under Sec-
tion 6320 and/or 6330 (notice). In the notice Appeals sus-
tained the proposed levy. The notice stated that ‘‘under cur-
rent procedures’’ the notice of intent to levy ‘‘is deemed valid
and will not be rescinded even when there is a pending
installment agreement.’’ The notice also stated: ‘‘Based on
the financial information provided during the hearing process
Appeals determined the appropriate collection resolution to
be an installment agreement with down payment of $8,520
36          143 UNITED STATES TAX COURT REPORTS              (30)


then $25 per month for 12 months to increase to $734 per
month thereafter. The down payment is your percentage
share of a joint savings account with your wife.’’

                          Discussion
A. Summary Judgment Standard
  Summary judgment is intended to expedite litigation and
avoid unnecessary and expensive trials. Fla. Peach Corp. v.
Commissioner, 90 T.C. 678, 681 (1988). Summary judgment
may be granted where there is no genuine dispute as to any
material fact and a decision may be rendered as a matter of
law. Rule 121(b). The moving party bears the burden of
showing that there is no genuine dispute as to any material
fact, and factual inferences will be read in a manner most
favorable to the party opposing summary judgment. See id.;
Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992),
aff ’d, 17 F.3d 965 (7th Cir. 1994).
B. Statutory Framework
   Section 6331(a) provides that if any person liable to pay
any tax neglects or refuses to pay such tax within 10 days
after notice and demand for payment, then the Secretary is
authorized to collect such tax by levy upon that person’s
property. Section 6330(a) requires the Secretary to send writ-
ten notice to the person of that person’s right to request an
Appeals hearing before a levy is made. If an Appeals hearing
is requested, the Appeals officer must, at the hearing, verify
that the requirements of any applicable law or administra-
tive procedure have been met. Sec. 6330(b)(1), (c)(1). Section
6330(c)(2) prescribes the matters that a person may raise at
the Appeals hearing, including spousal defenses, challenges
to the appropriateness of the Commissioner’s intended collec-
tion action, and possible alternative means of collection,
including offers-in-compromise (OIC) and installment agree-
ments. The existence or amount of the underlying tax
liability may also be contested, but only if the person 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).
(30)                  EICHLER v. COMMISSIONER                            37


C. Standard of Review
   Petitioner has not challenged his underlying tax liabilities.
We review respondent’s determination for abuse of discretion,
asking whether it was arbitrary, capricious, or without sound
basis in fact or law. See, e.g., Murphy v. Commissioner, 125
T.C. 301, 320 (2005), aff ’d, 469 F.3d 27 (1st Cir. 2006); Sego
v. Commissioner, 114 T.C. at 610.
D. Whether Respondent’s Determination Not To Rescind the
   Notices of Intent To Levy Was an Abuse of Discretion
   Petitioner argues that respondent abused his discretion in
refusing to rescind the notices of intent to levy. He argues
that section 6331(k)(2) precludes the IRS from issuing a
notice of intent to levy while an installment agreement offer
is pending.
   Although section 6331(a) grants the Secretary authority to
levy upon a taxpayer’s property or rights to property, various
subsections of section 6331 prohibit the Secretary from lev-
ying under certain circumstances. See sec. 6331(f), (g), (i), (j),
(k). Section 6331(k)(2) provides:
    (2) INSTALLMENT AGREEMENTS.—No levy may be made under sub-
  section (a) on the property or rights to property of any person with
  respect to any unpaid tax—
       (A) during the period that an offer by such person for an installment
    agreement under section 6159 for payment of such unpaid tax is
    pending with the Secretary; and
       (B) if such offer is rejected by the Secretary, during the 30 days
    thereafter (and, if an appeal of such rejection is filed within such 30
    days, during the period that such appeal is pending) * * *
   By its terms this statute bars the IRS, while a taxpayer’s
offer for an agreement request is pending, from making a
levy; it does not bar the IRS from issuing notices of intent
to levy. 5 Accord United States v. Austin, No. 09–10405–RWZ,
  5 The notice of determination does not expressly reflect any determina-
tion as to whether petitioner’s installment agreement offer was in fact
‘‘pending’’ when the IRS issued the notices of intent to levy. Rather, the
notice of determination proceeds upon the premise that a notice of intent
to levy is valid and will not be rescinded ‘‘even when there is a pending
installment agreement.’’ In this proceeding respondent argues for the first
time that the installment agreement was not pending when the notices of
intent were issued. In support of this argument, respondent points to the
May 13, 2011, letter from the IRS Service Center in Atlanta which stated
                                               Continued
38            143 UNITED STATES TAX COURT REPORTS                         (30)


2010 WL 1711294, at *3 n.2 (D. Mass. Apr. 26, 2010), aff ’d,
526 Fed. Appx. 2 (1st Cir. 2013); Politte v. United States, No.
07CV1950 JLS (CAB), 2009 WL 3166924, at *5 (S.D. Cal.
Aug. 6, 2009); see also Living Care Alts. of Utica, Inc. v.
United States, 411 F.3d 621, 629 (6th Cir. 2005) (holding that
section 6331(f) and (j), which provides, similarly to section
6331(k), that ‘‘no levy may be made’’ before the IRS has
taken certain actions, do not bar the IRS from issuing notices
of intent to levy before taking these actions); Medlock v.
United States, 325 F. Supp. 2d 1064, 1079 (C.D. Cal. 2003)
(same). 6 The regulations expressly provide that while levy is
prohibited ‘‘[t]he IRS may take actions other than levy to
protect the interests of the Government’’. Sec. 301.6331–
4(b)(1), Proced. & Admin. Regs. A notice of intent to levy is
an action other than a levy to protect the interests of the
Government; unlike a levy, it is merely preliminary to a
collection action, rather than a collection action barred by
section 6331(k)(2). See Politte, 2009 WL 3166924, at *5.
that ‘‘we haven’t completed all the processing necessary for a complete re-
sponse’’. It is unclear from the record to what extent this delay in proc-
essing petitioner’s installment agreement offer was attributable to the IRS’
failure to input the offer into its computer system until June 6, 2011. In
any event, because we decide the issue of the effect of sec. 6331(k)(2) in
respondent’s favor even if we assume, as apparently did Appeals, that peti-
tioner’s offer was pending when the IRS issued the notices of intent to
levy, it is unnecessary to consider respondent’s argument raised for the
first time in this proceeding. Cf. Antioco v. Commissioner, T.C. Memo.
2013–35 (declining to uphold a notice of determination on grounds other
than those relied upon in the notice (citing SEC v. Chenery Corp., 332 U.S.
194 (1947), and SEC v. Chenery Corp., 318 U.S. 80 (1943))); Jones v. Com-
missioner, T.C. Memo. 2012–274 (same); Salahuddin v. Commissioner, T.C.
Memo. 2012–141 (same).
   6 We are mindful that in Tucker v. Commissioner, T.C. Memo. 2011–67

(upholding Appeals’ rejection of an OIC), aff ’d, 676 F.3d 1129 (D.C. Cir.
2012), in the ‘‘Background’’ section of the opinion, a footnote indicated that
the IRS had withdrawn a notice of intent to levy that it had issued after
the taxpayer had submitted an OIC. By way of explanation, the footnote
stated: ‘‘Section 6331(k)(1) provides for a restraint on levy while an OIC
is pending, and the issuance of the notice of levy violated that restriction.’’
Id., slip op. at 8 n.6. This dictum, however, did not represent a holding
or a predicate to any holding in Tucker, as made explicit in the same foot-
note: ‘‘The issuance of that first levy notice (and its subsequent with-
drawal) was not part of the CDP hearing or determination and is not part
of the CDP appeal at issue here.’’ Id. Accordingly, the dictum in Tucker
concerning sec. 6331(k)(1) does not control this case.
(30)                EICHLER v. COMMISSIONER                          39


Accordingly, under the regulations, consistent with the plain
language of the statute, the IRS was not prohibited from
issuing the notices of intent to levy after petitioner submitted
his offer for an installment agreement.
   Petitioner also argues that respondent should have
rescinded the notices of intent to levy pursuant to IRM pt.
5.11.1.2.2.8 and IRM pt. 5.14.1.3. In the first instance we
observe that provisions of the IRM do not carry the force and
effect of law or confer rights on taxpayers. See, e.g, Fargo v.
Commissioner, 447 F.3d 706, 713 (9th Cir. 2006), aff ’g T.C.
Memo. 2004–13. In any event, we conclude that respondent
did not abuse his discretion in applying these provisions.
   IRM pt. 5.11.1.2.2.8 appears in the part of the IRM that
provides information and guidance to revenue officers in the
collection process. It directs the IRS Collection Division to
rescind notices of intent to levy in certain circumstances, one
of which is when a notice of intent to levy is issued while
levy action is prohibited and the taxpayer timely requests an
Appeals hearing. By contrast, IRM pt. 8.22.2.2.2.2(5) (Dec.
14, 2010) states that Appeals should not rescind a notice of
intent to levy that was issued during the pendency of an
installment agreement, even where levy is prohibited. Peti-
tioner argues that these two provisions are inconsistent and
that we should treat IRM pt. 5.11.1.2.2.8 as controlling. We
disagree. The IRM is not necessarily inconsistent in directing
the Collection Division and Appeals to take different actions.
SO Magee did not abuse her discretion in following the IRM
provisions directed to and applicable to Appeals, of which she
was a part.
   In sum, we hold that respondent did not abuse his discre-
tion in declining to rescind the notices of intent to levy.
E. Respondent’s Determination Requiring Petitioner To Make
   an $8,520 Downpayment as a Condition of His Install-
   ment Agreement
   Petitioner also argues that respondent abused his discre-
tion in determining that petitioner should make an $8,520
downpayment as a condition of his installment agreement. 7
  7 Petitioner
             does not take issue with SO Magee’s determination requiring
installment payments of $25 per month for one year followed by payments
                                             Continued
40           143 UNITED STATES TAX COURT REPORTS           (30)


Petitioner argues that having to make the $8,520 down pay-
ment would cause economic hardship for him and his wife.
   Section 6159 authorizes the Secretary to enter into an
installment agreement upon determining that the proposed
installment agreement would facilitate full or partial collec-
tion of the tax liability. Recognizing that the Secretary has
the discretion to accept or reject any proposed installment
agreement, see sec. 301.6159–1(c)(1)(i), Proced. & Admin.
Regs., the Court gives due deference to the Secretary’s deter-
mination, see Marascalco v. Commissioner, T.C. Memo. 2010–
130, aff ’d, 420 Fed. Appx. 423 (5th Cir. 2011).
   The IRM describes procedures the IRS uses in determining
whether a proposed installment agreement facilitates the
collection of an unpaid tax liability. These procedures require
taxpayers to liquidate assets in order to qualify for an
installment agreement in the absence of special cir-
cumstances such as old age, ill health, or economic hardship.
See IRM pt. 5.14.1.4(5) and (6) (June 1, 2010).
   During petitioner’s Appeals hearing Mr. Westlake asserted
repeatedly that petitioner and his wife were elderly and had
limited financial resources and that making the $8,520 down-
payment would pose an undue economic hardship for them.
Additionally, Mr. Westlake asserted that the funds in the
joint bank account did not actually belong to petitioner. We
find no indication in the record that SO Magee expressly
considered these issues.
   Because the record does not allow for meaningful review in
this regard, and there is a genuine dispute of material fact,
we will deny the parties’ cross-motions for summary judg-
ment and remand this case for Appeals to clarify the basis
for SO Magee’s determination with regard to the appropriate-
ness of requiring the disputed downpayment in the light of
the concerns petitioner raised. See Hoyle v. Commissioner,
131 T.C. 197, 204–205 (2008). Upon remand Appeals shall
consider any new collection alternative that petitioner may
wish to propose, taking into account any changed cir-
cumstances and other relevant factors.



of $734 per month thereafter.
(30)              EICHLER v. COMMISSIONER                       41


  To reflect the foregoing,
                              An appropriate order will be issued.
                        f
