                        T.C. Memo. 2003-74



                      UNITED STATES TAX COURT



                   STAN D. KAYE, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 7069-02L.              Filed March 13, 2003.



     Stan D. Kaye, pro se.

     Hieu C. Nguyen, for respondent.



                        MEMORANDUM OPINION


     GERBER, Judge:   Respondent, in a motion filed on November

12, 2002, moved for summary judgment on the questions of whether

he may proceed with collection and whether a section 66731



     1
       All section references are to the Internal Revenue Code in
effect for the year in issue, and all Rule references are to the
Tax Court Rules of Practice and Procedure, unless otherwise
indicated.
                               - 2 -

penalty should be imposed against petitioner.    Respondent alleges

that all section 6330 prerequisites have been met and that he

should be allowed to proceed with collection of petitioner’s

assessed and outstanding tax liability.    With respect to the

penalty, respondent contends that petitioner instituted this

proceeding primarily for delay and that his position in the

proceeding is frivolous and groundless.

     Petitioner’s objection to respondent’s motion for summary

judgment was filed on December 23, 2002.    In essence, petitioner

contends that, although respondent has sent certain documents to

him, those documents are not acceptable because they do not meet

the standards that petitioner contends exist.    In particular,

petitioner contends that the Secretary of the Treasury must

personally sign notices or that respondent must prove that the

person who did sign notices sent to him was properly authorized

to sign.   Petitioner also contends that he will not treat

decisions of the Tax Court as law by which he is bound unless it

is shown that “the Congress of the United States passed a law

stating that the U.S. Citizen is bound by Tax Court decisions.”

Background

     Petitioner resided in Moreno Valley, California, at the time

his petition was filed.   Petitioner’s 1995 Federal income tax

return was filed on April 15, 1996, and reflected $46,294 in

taxable income and an $11,767 income tax liability.    The tax
                               - 3 -

liability for the unpaid 1995 tax balance was assessed and on

June 10, 1996, respondent made notice and demand on petitioner to

pay his outstanding 1995 income tax liability.    On April 15,

1997, and April 15, 1998, petitioner filed his 1996 and 1997

income tax returns on each of which he entered zeros in all

pertinent boxes for the reporting of income.

     On April 22, 1998, respondent mailed a Notice of Deficiency

to petitioner determining a $16,402 income tax deficiency for

1996, based on petitioner’s Form W-2, Wage and Tax Statement, and

Form 1099-R, Distributions from Pensions, Annuities, Retirement

or Profit Sharing Plans, IRAs, Insurance Contracts, etc.,

reflecting income from third-party sources.    Respondent also

determined a $3,280.40 penalty under section 6662(a) for

petitioner’s 1996 tax year.   Petitioner acknowledged receipt of

the deficiency notice in a July 18, 1998, letter to respondent

and, among other similar protester statements, indicated, as

follows:

     I have attached to this letter an excerpt from the
     Supreme Court decision FEDERAL CROP INSURANCE CORP. v
     A.A. MERRILL, 332 U.S. 380. Note that the Court held
     in that case that:

           Anyone entering into an arrangement with the
           government takes a risk of having accurately
           ascertained that he who purports to act for
           the government stays within the bounds of his
           authority, even though the agent himself may
           be unaware of the limitations upon his
           authority. (emphasis added)
                                - 4 -

     Note that the Supreme Court in this decision warns the
     public that those who pay attention to what federal
     employees say “take the risk” that such employees may not be
     acting “within the bounds of (their) authority” and that
     such employees may even be “unaware of the limitations of
     (their) authority.”

     Well, I am not prepared to take that risk.

Petitioner did not petition this Court with respect to the Notice

of Deficiency for his 1996 taxable year.    Thereafter, the 1996

tax deficiency and penalty was assessed and on October 12, 1998,

notice and demand for payment of the assessed 1996 income tax

liability was made on petitioner.

     On November 20, 1998, respondent mailed a Notice of

Deficiency to petitioner determining, for petitioner’s 1997 tax

year, a $23,004 income tax deficiency and a $684.33 addition to

tax under section 6651(a)(2).    Again, petitioner acknowledged

receipt of the notice in a January 31, 1999, letter and raised

various protester arguments, but he did not file a petition with

this Court regarding his 1997 income tax deficiency.    Thereafter,

respondent assessed the 1997 tax deficiency and notice and demand

was made on petitioner by means of a June 28, 1999, notice.

     On September 6, 2000, respondent issued two Form Letters

1058, Final Notice--Notice of Intent to Levy and Notice of Your

Right to a Hearing, one for 1995 and 1996 and the other for 1997

and 1998.2


     2
         The 1998 liability was for a sec. 6702 civil penalty. In
                                                     (continued...)
                                - 5 -

     On October 12, 2000, respondent received petitioner’s Form

12153, Request for a Collection Due Process Hearing.   On February

13, 2002, a face-to-face hearing was held between an Appeals

officer and petitioner.   During the hearing, petitioner was

provided with a Form 4340, Certificate of Assessments, Payments,

and Other Specified Matters for his 1995, 1996, and 1997 tax

years.   The Appeals officer also informed petitioner that the

arguments he made at the hearing were considered to be frivolous.

The hearing was recorded and transcribed.

     On March 8, 2002, respondent issued two Notice(s) of

Determination Concerning Collection Action(s) Under Section 6320

and/or 6330 advising that respondent determined to proceed with

collection.    Attached to the notices were the Appeals officer’s

report, denominated as a “Summary of Issue and Recommendation”,

which included advice to petitioner that the Tax Court is

authorized “to impose monetary sanctions up to $25,000 for

instituting or maintaining an action before it primarily of [sic]

delay or for a [sic] taking a position that is frivolous or

groundless.”

Discussion

     Respondent seeks summary judgment with respect to whether he

may proceed to collect certain outstanding tax liabilities


     2
      (...continued)
his petition to this Court, petitioner did not challenge
respondent’s actions with respect to the 1998 liability.
                                 - 6 -

against petitioner and whether petitioner should be held liable

for a penalty under section 6673.     Rule 121 provides for summary

judgment for part or all of the legal issues in controversy if

there is no genuine issue as to any material fact.     Sundstrand

Corp. v. Commissioner, 98 T.C. 518, 520 (1992), affd. 17 F.3d 965

(7th Cir. 1994).     In that regard, summary judgment is intended to

expedite litigation and avoid unnecessary and expensive trials.

Fla. Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988).

     There is no genuine issue as to any material fact in this

case.     The matters raised in the pleadings are susceptible to

resolution by means of summary judgment.     Respondent, pursuant to

section 6331, seeks to levy on petitioner’s property.       In accord

with section 6330(a), respondent provided petitioner with a final

notice of intent to levy, which also included notice of

petitioner’s right to an administrative appeal of respondent’s

determination to collect the tax.     In that regard, the

Commissioner cannot collect unpaid tax by levy without the

opportunity for a taxpayer to seek an administrative review of

the determination to proceed with collection, and the opportunity

for judicial review of the administrative determination.       Davis

v. Commissioner, 115 T.C. 35, 37 (2000).

        Petitioner did not file a petition with respect to the
                                - 7 -

Notices of Deficiency,3 so the validity of the underlying tax

liabilities for 1996 and 1997 was not properly at issue in the

administrative hearing, and is not at issue here.    With respect

to his 1995 tax liability, which petitioner reported but did not

pay, he has not argued or shown that the amount reported by him

is in error.    Accordingly we review here whether respondent’s

administrative determination to proceed with collection is an

abuse of discretion.    Sec. 6330(c)(2)(B); Sego v. Commissioner,

114 T.C. 604, 610 (2000).

     At his administrative hearing, petitioner disputed the

appropriateness of respondent’s proposed collection action by

questioning whether the Appeals officer had satisfied the

verification requirement of section 6330(c)(1).    Petitioner also

questioned whether respondent met various statutory requirements

which petitioner contended were a prerequisite to collection.

Petitioner contends that the forms used by respondent were

improper and did not constitute notice and demand.    Petitioner

also contends that the lack of personal verification by the

Secretary or a person shown to be authorized to exercise the

Secretary’s authority was a flaw that should preclude respondent

from proceeding with collection.

     At the Appeals hearing, petitioner was provided with

transcripts of his accounts, which included detailed information


     3
         Petitioner acknowledged receipt of the notices.
                               - 8 -

underlying the assessments of the tax in question.   However,

petitioner does not question whether all of the steps had been

taken or performed.   Instead, he argues that documents used by

respondent to provide petitioner with notice were not genuine or

authentic, and accordingly, do not meet the statutory

requirements.

     Petitioner contends that the Form 4340 is insufficient to

prove that proper notice was given and that the assessments were

valid.   Form 4340 has been generally accepted by courts to show

that a valid assessment has been made within the meaning of

section 6203.   Hefti v. IRS, 8 F.3d 1169 (7th Cir. 1993); Farr v.

United States, 990 F.2d 451, 454 (9th Cir. 1993); Geiselman v.

United States, 961 F.2d 1 (1st Cir. 1992); Davis v. Commissioner,

supra.   Petitioner has raised superficial questions and made

conclusory allegations regarding the assessment (such as whether

respondent used the proper form), but he has not shown any

substantive or meaningful irregularity in the assessment process.

See Nicklaus v. Commissioner, 117 T.C. 117, 121 (2001); Berkey v.

IRS, 88 AFTR 2d 2001-6530, 2001-2 USTC par. 50,708 (E.D. Mich.

2001).

     Petitioner also complains that he did not receive a notice

and demand.   This contention, however, is similar to the others

made by petitioner; i.e., he does not question whether he

actually received various documents from respondent, but he
                                - 9 -

questions whether respondent used the particular form that

petitioner argues must be used for the notice and demand to be

valid.    In that regard, section 6330(c)(1) does not require the

Commissioner to rely on a particular document to satisfy the

verification requirement.    Wagner v. Commissioner, T.C. Memo.

2002-180; see also Roberts v. Commissioner, 118 T.C. 365, 371

(2002).    In addition, it has been held that “‘[t]he form on which

a notice of assessment and demand for payment is made is

irrelevant as long as it provides the taxpayer with all the

information required under * * * [section 6303].’”    Hughes v.

United States, 953 F.2d 531, 536 (9th Cir. 1992) (quoting Elias

v. Connett, 908 F.2d 521, 525 (9th Cir. 1990)); Planned Invs.,

Inc. v. United States, 881 F.2d 340, 344 (6th Cir. 1989).

     In addition, respondent is not required to prove receipt by

petitioner of notice and demand, but need only show that the

notices and demand were sent to petitioner’s last known address.

United States v. Chila, 871 F.2d 1015, 1019 (11th Cir. 1989);

Pursifull v. United States, 849 F. Supp. 597, 601 (S.D. Ohio

1993), affd. 19 F.3d 19 (6th Cir. 1994).

     Finally, Form 4340 may be relied upon to show that notice

and demand was mailed to a taxpayer.    Hansen v. United States, 7

F.3d 137, 138 (9th Cir. 1993); United States v. Chila, supra.

Respondent’s failure to produce a copy of the notice and demand

document is not conclusive, “because the notices are computer
                               - 10 -

generated and do not exist in hard copy.”    Pursifull v. United

States, supra at 601; Bassett v. United States, 782 F. Supp. 113,

117 (M.D. Ga. 1992).   Accordingly, we hold that respondent did

not abuse his discretion with respect to the determination to

proceed with collection.

     Respondent has also moved that petitioner be held liable for

a penalty under section 6673 on the ground that his arguments are

frivolous and that he instituted and maintained this proceeding

primarily for delay.   Section 6773 provides that this Court may

impose a penalty, not to exceed $25,000, where it is found that a

taxpayer’s position in the proceeding is frivolous and/or that

the proceeding was instituted and maintained primarily for delay.

Section 6673 penalties may be imposed in a lien and levy case.

Pierson v. Commissioner, 115 T.C. 576, 580-581 (2000).

     In addition to questioning the authenticity of respondent’s

documentation, petitioner has interposed other protester

arguments which have, on numerous occasions, been rejected by the

courts.   In order to support his arguments, petitioner has

selectively picked phrases out of context from statutes and/or

opinions.   In so doing, petitioner has chosen to ignore more

current or complete statements of the law.   Petitioner has

ignored the rules and regulations and contends that he is not

required to comply with or pay attention to respondent’s letters

and determinations.    Petitioners’ arguments are superficial and
                             - 11 -

without substance.

     Under these circumstances, we hold that petitioner’s

position in this proceeding is frivolous and that it has been

interposed primarily to protest the tax laws of this country

and/or to delay collection activity by respondent.    Accordingly,

we hold that petitioner is liable for a $4,000 penalty under

section 6673(a)(1).

     To reflect the foregoing,



                                      An Order and Decision will be

                                 entered granting respondent’s

                                 motion for summary judgment.
