                         T.C. Memo. 2003-60



                       UNITED STATES TAX COURT



                CHERYL D. FLATHERS, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 13037-02L.              Filed March 4, 2003.



     Cheryl D. Flathers, pro se.

     Rollin G. Thorley, for respondent.



                         MEMORANDUM OPINION


     CHIECHI, Judge:    This case is before the Court on respon-

dent’s motion for summary judgment and to impose a penalty under

section 6673 (respondent’s motion).1   We shall grant respondent’s



     1
      All section references are to the Internal Revenue Code in
effect at all relevant times. All Rule references are to the Tax
Court Rules of Practice and Procedure.
                               - 2 -

motion.

                            Background

     The record establishes and/or the parties do not dispute the

following.

     Petitioner resided in Las Vegas, Nevada, at the time she

filed the petition in this case.

     On or about March 17, 1999, petitioner filed a Federal

income tax (tax) return for her taxable year 1998 (1998 return).

In her 1998 return, petitioner reported total income of $0, total

tax of $0, and claimed a refund of $4,704.60 of tax withheld.

Petitioner attached to her 1998 return Form W-2, Wage and Tax

Statement, reporting wages, tips, and other compensation of

$47,554.71.   Petitioner also attached a two-page document to that

return (petitioner’s attachment to her 1998 return).   That

document stated in pertinent part:

     I, Cheryl Dawn Flathers, am submitting this as part of
     my 1998 Income Tax Return, even though I know that no
     section of the Internal Revenue Code:

     1)   Establishes an income tax "liability [sic]: as,
          for example, Code Sections 4401, 5005, and 5703 do
          with respect to wagering, alcohol, and tobacco
          taxes;

     2)   Provides that income taxes "have to be paid on the
          basis of a return"-as, for example, Code Sections
          4374, 4401(c), 5061(a) and 5703(b) do with respect
          to other taxes; I am filing anyway because I know
          the government has prosecuted others for failing
          to file income tax forms by (erroneously) invoking
          Code Sections 7201 and 7203. Therefore, this
          return is not being filed voluntarily but is being
          filed out of fear that if I did not file this
                             - 3 -

         return I could also be (illegally) prosecuted for
         failing to file an income tax return for the year
         1998.

3)       In addition to the above, I am filing even though
         the "Privacy Act Notice" as contained in a 1040
         booklet clearly informs me that I am not required
         to file. It does so in at least two places.
              a) In one place, it states that I need only
              file a return for "any tax" I may be "liable"
              for. Since no Code Section makes me "liable"
              for income taxes, this provision notifies me
              that I do not have to file an income tax return.
              b) In another place, it directs me to Code
              Section 6001. This section provides, in
              relevant part that "Whenever in the judgment
              of the Secretary it is necessary, he may
              require any person by notice served on such
              person; or by regulations, to make such re-
              turns, render such statements, or keep such
              records, as the Secretary deems sufficient to
              show whether or not such person is liable far
              [sic] the tax under this title." Since the
              Secretary of the Treasury did not "serve" me
              with any such "notice" and since no legisla-
              tive regulation exists requiring anyone to
              file an income tax return, I am again in-
              formed by the "Privacy Act Notice" that I am
              not required to file an income tax return.

     *        *       *        *       *       *       *

7)       It should also be noted that I had "zero" income
         according to the Supreme Court's definition of
         income * * * since in Merchant’s Loan & Trust C.V.
         Smlietanka [sic], 255 U.S. 509, (at pages 518 &
         519) that court held that "The word (income) must
         be given the same meaning in all of the Income Tax
         Acts of Congress that was given to it in the Cor-
         poration Excise Tax Act of 1909." Therefore,
         since I had no earnings in 1998, that would have
         been taxable as "income" under the Corporation
         Excise Tax Act of 1909, I can only swear to having
         "zero" income in 1998. Obviously, since I know
         the legal definition of "income"; if I were to
         swear to having received any other amount of "in-
         come" I would be committing perjury * * *. There-
         fore, not wishing to commit perjury * * *, I can
                               - 4 -

          only swear to having "zero" income for 1998.

     On June 14, 1999, respondent paid petitioner the $4,704.60

refund that she claimed in her 1998 return plus interest thereon.

     On February 4, 2000, respondent issued to petitioner a

notice of deficiency (notice) with respect to her taxable year

1998, which she received.   In that notice, respondent determined

a deficiency in, and an accuracy-related penalty under section

6662(a) on, petitioner’s tax for her taxable year 1998 in the

respective amounts of $5,969 and $1,177.

     Petitioner did not file a petition in the Court with respect

to the notice relating to her taxable year 1998.   Instead, on

April 15, 2000, in response to the notice, petitioner sent a

letter (petitioner’s April 15, 2000 letter) to the Internal

Revenue Service.   That letter stated in pertinent part:

         Your Deficiency Notice dated February 4, 2000.

          First and foremost, be advised that this alleged
     deficiency has been created out of thin air by the IRS
     from a return which I submitted in a timely manner, a
     return which was reviewed by the IRS and a refund
     issued, including interest paid for the delay in re-
     funding the amount to me. The IRS now attempts to
     extort penalties and interest on top of the amount duly
     refunded to me.

          According to your “Deficiency Notice” of the above
     date (cover sheet [page 1 of notice with respect to
     petitioner’s taxable year 1998] attached), there is an
     alleged deficiency with respect to my 1998 income tax
     return of $7546.09, and if I wanted to “contest this
     deficiency before making payment,” I must “file a
     petition with the United States Tax Court.” Before I
     file, pay, or do anything with respect to your “Notice”
     I must first establish whether or not it was sent
                              - 5 -

     pursuant to law, whether or not it has the “force and
     effect of law,” and whether you had any authority to
     send me the Notice in the first place.

        *       *       *       *       *       *       *

     Let me further point out that IRS Code Sections 6001
     and 6011 (as identified in the 1040 Privacy Act)
     notifies me that I need only “comply with regulations.”
     Nothing in the Privacy Act Notice or in the above
     statutes informs me that I have to “comply” with, or
     pay attention to, letters and/or alleged “determina-
     tions” sent to me by various and sundry employees of
     the IRS.

          Please note that Section 6212 states that “If the
     Secretary determines that there is a deficiency in
     respect of any tax ... he is authorized to send notice
     of such deficiency etc., etc., etc.” However, the
     “Notice” I received was not sent by the Secretary but
     by Deborah S. Decker who is identified as being the
     Director of the IRS Service Center in Ogden, Utah, and
     I have no way of knowing whether he/she has been dele-
     gated by the Secretary to send out such notices on the
     Secretary’s behalf. So before I do anything at all
     with respect to your “Notice”, I would have to see a
     Delegation Order from the Secretary of the Treasury
     delegating Deborah S. Decker the authority to send out
     Deficiency Notices.

          In addition, I would also like you to send me (or
     identify for me) the legislative regulations that you
     claim implement Code Sections 6212 and 6213. I have
     also attached an excerpt from the IRS Procedures Manual
     (MT 1218-196, at page P-6-40) which points out that the
     IRS is required to “make available to all taxpayers
     comprehensive, accurate, and timely information on the
     requirements of tax law and regulations.” So, pursuant
     to this provision from your Procedures Manual, I am
     asking that you identify (“make available”) for me the
     legislative regulations that you claim implement both
     Code Section 6212 and 6213 - since I haven’t been able
     to locate them.

     On July 17, 2000, respondent assessed a frivolous return

penalty under section 6702 regarding petitioner’s 1998 return.
                               - 6 -

     On July 24, 2000, respondent assessed petitioner’s tax, as

well as a penalty under section 6662(a) and interest as provided

by law, for her taxable year 1998.     (We shall refer to those

assessed amounts, as well as interest as provided by law accrued

after July 24, 2000, as petitioner’s unpaid liability for 1998.)

     On July 24, 2000, respondent issued to petitioner a notice

of balance due with respect to petitioner’s unpaid liability for

1998.

     On October 12, 2000, respondent issued to petitioner a final

notice of intent to levy and notice of your right to a hearing

(notice of intent to levy) with respect to the frivolous return

penalty under section 6702 regarding her 1998 return.

     On May 30, 2001, respondent issued to petitioner a notice of

Federal tax lien and your right to a hearing (notice of tax lien)

with respect to both petitioner’s unpaid liability for 1998 and

the frivolous return penalty under section 6702 regarding her

1998 return.

     On or about June 25, 2001, in response to the notice of

intent to levy and the notice of tax lien, petitioner filed Form

12153, Request for a Collection Due Process Hearing (Form 12153),

and requested a hearing with respondent’s Appeals Office (Appeals

Office).   Petitioner attached, inter alia, a seven-page document

to her Form 12153 (petitioner’s attachment to her Form 12153).

That document stated in pertinent part:
                             - 7 -

     1.   VERIFICATION FROM THE SECRETARY.
First of all, I expect you to have at the CDP hearing
“verification from the Secretary that the requirements
of any applicable law or administrative procedure have
been met”. That is the specific statement from the
Secretary (or his delegate) that THE LAW requires you
to have. Don’t tell me at the CDP hearing that in lieu
of your having that specific statement from the Secre-
tary, you have some IRS transcript or printout that “I
may not understand”. * * *

         2.
          PROOF OF ASSESSMENT AND COPY OF RETURN SHOW-
          ING OWED TAXES
Pursuant to Code Section 6201(1), before I can owe any
income taxes there has to be an assessment based on a
“return or list”. I filed a return showing no taxes
due, in fact a return that showed a refund for which a
refund check was issued by the Internal Revenue Ser-
vice, PLUS INTEREST! Therefore, I do not see how the
IRS could have made a lawful assessment from a return
showing no income taxes due and owing unless the IRS
prepared another 1040 showing a different amount due.
* * *

     *         *       *       *       *       *       *

         3.   A COPY OF FORM 17, STATUTORY NOTICE OF DEFI-
              CIENCY
         I have never received a Statutory Notice of Defi-
         ciency, Form 17, for payment of any 1998 income
         taxes.

     *        *       *        *       *       *       *

         4.   I CLAIM THERE IS NO UNDERLYING, STATUTORY
              LIABILITY IN CONNECTION WITH THE INCOME TAXES
              AT ISSUE.
         I am challenging the “existence” of the underlying
         tax liability as the law (Sec. 6330(c)(2)(B)) and
         regulation (301.6330-1T-(3)) specifically permit
         me to do. * * *

     *        *       *        *       *       *       *

5.       I CLAIM THERE IS NO STATUTE REQUIRING ME “TO PAY”
         THE INCOME TAXES AT ISSUE.
         * * * it is my belief that there is no law requir-
                              - 8 -

          ing me “to pay” income taxes * * *

     6.   NO LAW AUTHORIZES THE IRS TO CLAIM THAT I OWE MORE
          IN INCOME TAXES THAN THE “ZERO” I REPORTED ON MY
          1998 INCOME TAX RETURN.
     * * * it is my contention that no law authorizes the
     Secretary (let alone any IRS agent) to determine that I
     owe more in income taxes that the “zero” I reported on
     my 1998 income tax return. * * * [Reproduced liter-
     ally.]

     On April 12, 2002, a settlement officer with respondent’s

Appeals Office (settlement officer) sent petitioner a letter.

That letter stated in pertinent part:

     I have scheduled the Collection Due Process hearing you
     requested on this case for the time and date shown
     above [May 16, 2002]. * * *

     Your request for a due process hearing was timely for
     the Letter 3172, Notice of Federal Tax Lien Filing,
     issue for the Form 1040 taxes for 1998 and for the
     civil penalty assessment for 1998. Your request for a
     due process hearing for the Letter 1058, Notice of
     Intent to Levy, on the civil penalty assessment for
     1998 was not timely and therefore, you are entitled to
     an equivalency hearing on this matter.

     Appeals’ jurisdiction to hear your case is specified in
     the Internal Revenue code, Sections 6320 and 6330, and
     the related federal regulations. Appeals will consider
     the appropriateness of the proposed collection action,
     spousal defenses, and collection alternatives. If you
     received a statutory notice of deficiency * * * you may
     not raise as an issue the amount or existence of the
     underlying assessment. * * *

     I am also enclosing Forms 2866, Certificate of Official
     Record, and Forms 4340, Certificate of Assessment for
     the Form 1040 taxes for 1998 and for the civil penalty
     assessment under IRC §6702 for 1998. These documents
     meet the verification requirements under IRC
     §6330(c)(1). Your request for additional information
     should be made under the Freedom of Information Act
     through the Disclosure Officer located at the Internal
     Revenue Service, 210 E. Earll, Phoenix, Arizona 85012.
                              - 9 -

     I have reviewed the correspondence you attached to your
     request for the collection due process hearing and
     would like to point out that the courts have previously
     ruled against your arguments, and in some instances,
     have imposed sanctions. I have verified the validity
     of the assessments through the review of the complete
     computer transcripts, the tax return file and related
     workpapers. I have no further legal obligation to
     consider any challenge to the validity of the assess-
     ment in the absence of independent proof that the
     assessment was defective in some manner. I am hopeful
     that you wish to discuss legitimate issues and alterna-
     tives for resolving your case at the upcoming hearing.
     I will have the original tax return for 1998 available
     for your review at the hearing, as well as the civil
     penalty documentation.

     On May 3, 2002, respondent’s settlement officer sent peti-

tioner another letter (settlement officer’s May 3, 2002 letter).

That letter stated in pertinent part:

     I am writing to you regarding the upcoming collection
     due process hearing set for May 16, 2002 at 3:00 p.m.
     at the Las Vegas Appeals Office.

     You previously indicated in your correspondence that
     you intended to audio record the hearing and have a
     court reporter present. There has been a recent change
     in this practice for hearings before Appeals. Effec-
     tive immediately audio and stenographic recordings will
     no longer be allowed on Appeals cases.

     The recording of hearings has always been discretionary
     for Appeals under IRC §7521. Pursuant to a recent
     decision all audio and stenographic recordings will be
     eliminated. You may still have a witness present at
     the hearing; however, this witness may not represent
     you or negotiate for you.

     On May 7, 2002, in response to the settlement officer’s May

3, 2002 letter, petitioner sent the settlement officer a letter

(petitioner’s May 7, 2002 letter).    That letter stated in perti-

nent part:
                             - 10 -

    I am in receipt of your letter of May 3, 2002, in which
    you attempt to deny me the right to record my hearing
    under IRC section 7521.

        *      *       *       *       *        *       *

    Who made this “recent decision”, where is the documen-
    tation? Where is the proof of legislative mandate
    providing authority to make this change? Furthermore,
    under whose authority is my Constitutional right to
    preserve testimony for myself being truncated? After
    all, I require an accurate record of who said what and
    when.

     The code quoted [section 7521] deals with “Procedures
     involving taxpayer interviews”. Are you then stating,
     by quoting this code section, that you are only con-
     ducting an “interview” and not a “hearing” as is my
     right under the law? You are labeled as a “settlement
     officer”, not an “appeals officer”. If you are unable
     to show authority as an appeals officer, then I require
     that you provide an appeals officer at the hearing who
     has the authority to impartially decide the issues at
     hand. If this is an “interview” which is conducted by
     exam and audit and for which the code you quote would
     be correct, then I am not receiving a hearing. If you
     claim this is a hearing, then an appeals officer, with
     appropriate identification will need to be present to
     conduct a true hearing, and the code you quote does not
     apply.

     On May 13, 2002, in response to petitioner’s May 7, 2002

letter, respondent’s settlement officer sent petitioner a letter

(settlement officer’s May 13, 2002 letter).   That letter stated

in pertinent part:

     I am in receipt of your letter dated May 7, 2002 re-
     garding the change in procedures for the audio record-
     ing or stenographic recording of Appeals hearings. I
     am enclosing a copy of the memorandum dated May 2, 2002
     per your request for documentation of this change.

     This will be a “hearing” and as a settlement officer I
     have the same authority as an appeals officer to impar-
     tially decide the issues at hand, as you stated in your
                              - 11 -

     letter.

The copy of the memorandum referred to in the settlement offi-

cer’s May 13, 2002 letter, which the settlement officer enclosed

with that letter, stated in pertinent part:

     Effective immediately, audio and stenographic record-
     ings will no longer be allowed on Appeals cases.
     Taxpayers and/or representatives who have already
     requested such recordings will be informed of the
     change in practice immediately, and advised that their
     request cannot be allowed.

     BACKGROUND

     Prior to enactment of IRC 7521, Service Compliance
     functions voluntarily allowed audio recordings. Ap-
     peals decided to follow this practice at that time.
     IRC 7521, enacted in 1988, provided for the allowance
     of audio recordings of conferences relative to the
     determination or collection of a tax, between the
     taxpayer and the Internal Revenue Service, provided
     that the Service was given at least ten (10) days
     advance notice of the taxpayer’s intent to record the
     conference.

     Although Appeals makes liability and collectibility
     determinations, Appeals’ procedures differ from Exami-
     nation and Collection function contacts that are not
     discretionary for the taxpayer. Contact with Appeals
     is discretionary for the taxpayer, and as such, record-
     ing has always been discretionary for Appeals. * * *

     On May 16, 2002, respondent’s settlement officer held an

Appeals Office hearing with petitioner with respect to the notice

of tax lien.2   Although petitioner knew that the Appeals Office

no longer allowed audio recordings of Appeals Office hearings,



     2
      On May 16, 2002, respondent’s settlement officer also held
an equivalent hearing with petitioner with respect to the notice
of intent to levy.
                                - 12 -

petitioner secretly made an audio recording of her Appeals Office

hearing.     At the Appeals Office hearing, the settlement officer

gave petitioner Form 4340, Certificate of Assessments, Payments,

and Other Specified Matters (Form 4340), with respect to her

taxable year 1998.

     On July 11, 2002, the Appeals Office issued to petitioner a

notice of determination concerning collection action(s) under

section 6320 and/or 6330 (notice of determination) with respect

to petitioner’s unpaid liability for 1998 (notice of determina-

tion with respect to petitioner’s unpaid liability for 1998).3

An attachment to that notice stated in pertinent part:

     Verification of Legal and Procedural Requirements

     The Secretary has provided sufficient verification that
     the requirements of any applicable law or administra-
     tive procedure have been met.

     Certified account transcripts, Forms 4340, were re-
     quested and reviewed along with the administrative
     return file for 1998, which included the civil penalty
     work papers. * * *

         *        *       *       *       *       *       *

     The collection due process and equivalency hearings


     3
      On July 11, 2002, the Appeals Office also issued to peti-
tioner (1) a notice of determination with respect to the frivo-
lous return penalty regarding petitioner’s 1998 return and (2) a
decision letter concerning equivalent hearing under sec. 6320
and/or 6330 (decision letter) with respect to the notice of
intent to levy issued to petitioner with respect to the frivolous
return penalty regarding petitioner’s 1998 return (decision
letter with respect to the frivolous return penalty regarding
petitioner’s 1998 return).
                        - 13 -

were held on May 16, 2002 * * *. The taxpayer was
advised prior to the hearing by letter that no audio
recording or stenographic recording of the hearing
would be permitted per a directive issued by the Acting
Chief of Appeals dated May 2, 2002.

Settlement Officer Rene Swall has had no prior involve-
ment with respect to these liabilities.

Issues Raised by the Taxpayer

The taxpayer checked both blocks on the Form 12153 and
states, “see attached letter”. Attached is a copy of
the Notice of Federal Tax Lien (NFTL), the Letter 3172,
and several pages of non-filer arguments. As part of
the taxpayer’s argument, she asks for verification from
the secretary, proof of the assessments, [and] a copy
of the statutory notice of deficiency. The taxpayer
further claims that there is no underlying statutory
liability in connection with the income taxes at issue,
that there is no statute requiring her to pay the taxes
at issue, and that no law authorizes the Service to
claim that she owes more income tax than the “zero”
reported on her return. In addition the taxpayer
states that she did not receive a notice and demand for
payment per IRC §6331.

Certified transcripts, Forms 4340, for both periods
were provided to the taxpayer prior to the hearing.
The taxpayer was advised by letter that these tran-
scripts meet the verification requirements under IRC
§6330(c)(1). * * *

At the hearing the taxpayer raised the issue of audio
recording and was advised again that the audio record-
ing would not be allowed. * * *

   *       *       *       *       *       *       *

I attempted to review the Form 4340 transcripts and the
administrative file with the taxpayer, which included
the tax return filed and the statutory notice of defi-
ciency that was sent and received. The taxpayer stated
that what I provided her as evidence of the statutory
notice of deficiency was only a “letter”. The taxpayer
was advised that she could not raise the issue of the
underlying liability as she had received the statutory
notice of deficiency, and had in fact responded to it
                        - 14 -

with additional frivolous arguments. The taxpayer is
now precluded from raising this issue at the collection
due process hearing. Collection alternatives could not
be discussed with the taxpayer, as the taxpayer is not
in filing compliance, nor did the taxpayer attempt to
complete the financial statement that was mailed to her
prior to the hearing. The taxpayer asked for the cite
that makes her liable to pay the taxes and continued to
raise only frivolous arguments. The hearing was con-
cluded.

The taxpayer does not believe that wages are income or
that the tax laws apply to her. I advised the taxpayer
of recent court case decisions where sanctions were
imposed for bringing the same type of arguments and
attempted to provide the taxpayer with copies of recent
cases on T. Pierson and R. Davis as well as Publication
2105, Why Do I Have to Pay Taxes, and a handout, The
Truth About Frivolous Tax Arguments. The taxpayer
refused to accept these from me.

   *       *       *       *       *       *         *

The taxpayer raised no other non-frivolous issues.

Balancing the Need for Efficient Collection with Tax-
payer Concerns

The requirements of all applicable laws and administra-
tive procedures have been met. The courts have previ-
ously addressed the taxpayers’ arguments, and Appeals
does not have the authority for reconsideration of the
matters.

The assessments are valid and the Service followed
proper procedures in making these assessments. For the
civil penalty to apply the individual’s conduct must be
due in part to a position, which is frivolous, or a
desire (which appears on the return) to delay or impede
the administration of Federal income tax laws. Income
reported to the Service verifies that the taxpayer had
sufficient income that would require her to file a
return. The taxpayer was provided an opportunity to
file a correct return, but instead responded with
frivolous arguments. The taxpayer received her re-
quired notices. The filing of the NFTL was appropriate
to protect the Government’s interest. In addition, the
issuance of the notice of intent to levy was appropri-
                               - 15 -

     ate on the civil penalty assessment. No collection
     alternatives could be discussed as the taxpayer is not
     in filing compliance and the taxpayer only continued to
     raise frivolous arguments.

     Given the taxpayer’s history of non-compliance, I
     believe that collection action in the form of levy
     should be allowed to proceed. Lacking the taxpayer’s
     cooperation, the proposed collection action balances
     the need for efficient collection of taxes with the
     taxpayer’s legitimate concern that any collection
     action be no more intrusive than necessary.

                            Discussion

     The Court may grant summary judgment where there is no

genuine issue of material fact and a decision may be rendered as

a matter of law.4   Rule 121(b); Sundstrand Corp. v. Commissioner,

98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th Cir. 1994).    We

conclude that there is no genuine issue of material fact regard-

ing the questions raised in respondent’s motion.

     With respect to petitioner’s taxable year 1998, petitioner

received a notice of deficiency, but she did not file a petition

with respect to that notice.   On the instant record, we find that

petitioner may not challenge the existence or the amount of



     4
      The only questions raised in respondent’s motion relate to
petitioner’s unpaid liability for 1998 over which we have juris-
diction and do not relate to the frivolous return penalty regard-
ing her 1998 return over which we do not have jurisdiction. In
this connection, on Feb. 6, 2003, the Court issued an Order
granting respondent’s motion to dismiss this case for lack of
jurisdiction insofar as petitioner sought review of either the
notice of determination with respect to the frivolous return
penalty regarding petitioner’s 1998 return or the decision letter
with respect to the frivolous return penalty regarding peti-
tioner’s 1998 return.
                              - 16 -

petitioner’s unpaid liability for 1998.   See sec. 6330(c)(2)(B);

Sego v. Commissioner, 114 T.C. 604, 610-611 (2000); Goza v.

Commissioner, 114 T.C. 176, 182-183 (2000).

     Where, as is the case here, the validity of the underlying

tax liability is not properly placed at issue, the Court will

review the determination of the Commissioner of Internal Revenue

for abuse of discretion.   Sego v. Commissioner, supra at 610;

Goza v. Commissioner, supra at 181-182.

     As was true of petitioner’s attachment to her 1998 return,

petitioner’s April 15, 2000 letter, petitioner’s attachment to

her Form 12153, and petitioner’s May 7, 2002 letter, petitioner’s

response contains contentions, arguments, statements, and re-

quests that the Court finds to be frivolous and/or groundless.

To illustrate, petitioner appears to argue that she did not

receive proper notice and demand under section 6303(a) because,

according to petitioner, respondent must use Form 17 in issuing

such notice and demand.

     We reject petitioner’s argument that respondent did not

issue the notice and demand required by section 6303(a).   Form

4340 with respect to petitioner’s taxable year 1998 shows that

respondent sent petitioner a notice of balance due on July 24,

2000, the same day on which respondent assessed petitioner’s tax,

as well as any penalties and interest as provided by law, for her

taxable year 1998.   A notice of balance due constitutes the
                              - 17 -

notice and demand for payment under section 6303(a).    Craig v.

Commissioner, 119 T.C. 252, 262-263 (2002).    Respondent is not

required to use Form 17 as the notice and demand for payment.

E.g., Keene v. Commissioner, T.C. Memo. 2002-277; Tapio v.

Commissioner, T.C. Memo. 2002-141.

     As a further illustration of the frivolous and/or groundless

nature of petitioner’s position in this case, petitioner contends

in petitioner’s response that the settlement officer failed to

obtain verification that the requirements of any applicable law

or administrative procedure have been met, as required by section

6330(c)(1).   In this regard, petitioner contends that the settle-

ment officer improperly relied on Form 4340 to meet the verifica-

tion requirement of section 6330(c)(1).

     The record establishes that the settlement officer obtained

verification from the Secretary that the requirements of any

applicable law or administrative procedure were met, and we

reject petitioner’s contention to the contrary.    As for the

settlement officer’s reliance on Form 4340, at the Appeals Office

hearing, the settlement officer relied on, and gave petitioner,

Form 4340 with respect to petitioner’s taxable year 1998.

Section 6330(c)(1) does not require the settlement officer to

rely on a particular document to satisfy the verification re-

quirement imposed by that section.     Craig v. Commissioner, supra

at 261-262.   Nor does section 6330(c)(1) require the settlement
                                 - 18 -

officer to provide petitioner with a copy of the verification

upon which the settlement officer relied.        Id. at 262.   Form 4340

is a valid verification that the requirements of any applicable

law or administrative procedure have been met.        Id.   Petitioner

has not shown any irregularity in respondent’s assessment proce-

dure that would raise a question about the validity of the

assessment or the information contained in Form 4340 with respect

to petitioner’s taxable year 1998.        We hold that the assessment

with respect to petitioner’s taxable year 1998 was valid and that

the settlement officer satisfied the verification requirement of

section 6330(c)(1).   See id.5

     Based upon our examination of the entire record before us,

we find that respondent did not abuse respondent’s discretion in

determining to proceed with the collection action as determined

in the notice of determination with respect to petitioner’s

unpaid liability for 1998.

     In respondent’s motion, respondent requests that the Court

require petitioner to pay a penalty to the United States pursuant



     5
      In petitioner’s response, petitioner also argues that
“Appeals personnel denied Petitioner the right to protect her
rights in total disregard for the Taxpayer Bill of Rights,
Publication 1 and Petitioner’s constitutional right to protect
oneself.” That is because, according to petitioner, the Appeals
Office denied her request to record her Appeals Office hearing.
However, petitioner admits that she “did in fact tape the CDP
hearing”, and we shall not address petitioner’s argument about
the Appeals Office’s refusal to permit her to record her Appeals
Office hearing.
                               - 19 -

to section 6673(a)(1).   Section 6673(a)(1) authorizes the Court

to require a taxpayer to pay to the United States a penalty in an

amount not to exceed $25,000 whenever it appears to the Court,

inter alia, that a proceeding before it was instituted or main-

tained primarily for delay, sec. 6673(a)(1)(A), or that the

taxpayer’s position in such a proceeding is frivolous or ground-

less, sec. 6673(a)(1)(B).

     In Pierson v. Commissioner, 115 T.C. 576, 581 (2000), we

issued an unequivocal warning to taxpayers concerning the imposi-

tion of a penalty under section 6673(a) on those taxpayers who

abuse the protections afforded by sections 6320 and 6330 by

instituting or maintaining actions under those sections primarily

for delay or by taking frivolous or groundless positions in such

actions.6

     In the instant case, petitioner advances, we believe primar-

ily for delay, frivolous and/or groundless contentions, argu-

ments, statements, and requests, thereby causing the Court to

waste its limited resources.   We shall impose a penalty on

petitioner pursuant to section 6673(a)(1) in the amount of

$1,500.

     We have considered all of petitioner’s contentions, argu-



     6
      The record in this case reflects that the settlement offi-
cer attempted to give petitioner, inter alia, a copy of the
Court’s opinion in Pierson v. Commissioner, 115 T.C. 576 (2000),
which she refused to accept.
                             - 20 -

ments, statements, and requests that are not discussed herein,

and we find them to be without merit and/or irrelevant.

     To reflect the foregoing,

                                      An appropriate order granting

                                 respondent’s motion and decision

                                 will be entered for respondent.
