                         T.C. Memo. 2005-135



                       UNITED STATES TAX COURT



       RAYMOND AND CYNTHIA TURNER-SIMMONS, Petitioners v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 3151-03L.              Filed June 9, 2005.


     Raymond and Cynthia Turner-Simmons, pro sese.

     John W. Sheffield III, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     HALPERN, Judge:    This case is before the Court to review a

determination made by respondent’s Appeals Office (Appeals) that

respondent may proceed to collect by levy unpaid taxes with

respect to petitioners’ 1995 tax year (1995).    We review that

determination pursuant to section 6330(d)(1).
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     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.

                        FINDINGS OF FACT

     The parties have filed a stipulation of facts, which, with

accompanying exhibits (except for 2-R and 4-J1), is incorporated

herein by this reference.   Petitioners resided in Atlanta,

Georgia, at the time the petition was filed.

     Petitioners filed a joint Federal income tax return for 1995

(the 1995 return), showing a balance due of $2,478.83.

Respondent examined the 1995 return and determined a deficiency

in tax of $5,282 (the deficiency).     The examination concluded

with petitioners signing an Internal Revenue Service (IRS) Form

4549-CG, Income Tax Examination Changes (the Form 4549-CG).     The

Form 4549-CG recites only computational changes based on reported

self-employment income and a reported pension distribution.     By

signing the Form 4549-CG, petitioners agreed to immediate

assessment and collection of the deficiency and interest due to

March 1, 1997, and waived their appeal rights with the IRS and

their right to contest the deficiency in the Tax Court.




     1
        Exhibit 2-R was admitted into evidence independent of the
stipulation of facts. Exhibit 4-J was objected to by petitioner
and not admitted at trial. On brief, respondent states that he
no longer relies on Exhibit 4-J; therefore, we shall not receive
it into evidence.
                               - 3 -

Petitioner wife wrote the following on the signature page of the

Form 4549-CG:

     Upon receipt of this letter, I spoke with Mrs.
     Dillard on January 31, 199[ ] [illegible]. She
     explained and was very helpful in pointing out the
     additional taxes. We do not dispute the amount
     and are presently in an installment agreement with
     the IRS and will continue to make monthly payments
     to pay off the amount in full. Thank you.

     Respondent computes that petitioners have a remaining,

unpaid income tax liability for 1995 of $2,995.07 (the

remaining liability).2   On December 20, 2001, respondent

issued to petitioners a notice of intent to levy and of

petitioners’ right to a hearing under section 6330.

Petitioners requested a hearing under section 6330, and,

pursuant to the request, petitioner wife met with Appeals

Officer Murphy on January 6 and 14, 2003 (the section 6330

hearing).   At the section 6330 hearing, petitioners did not


     2
        That amount is respondent’s computation of the remaining
liability as of approximately the time of trial. Respondent
computes that amount as follows:

     1995 Return               Liability      Payment

     Return as filed          $ 4,901.00         --
     Withholding                   --         $2,422.17
     Estimated tax penalty        120.63         --
     Failure to pay penalty        12.39         --
     Interest                      15.22         --
     Form 4549-CG               5,282.00         --
     Payments                      --          4,914.00
                              $10,331.24      $7,336.17
     Remaining liability      $ 2,995.07         --
                               - 4 -

raise as an issue or dispute the adjustments in the Form

4549-CG.   The only issue raised by petitioners at the

section 6330 hearing was that they claimed that they had

already paid their 1995 income tax liability.   Petitioners

presented no evidence beyond petitioner wife’s statements

that they had paid that liability.

      On January 24, 2003, Appeals mailed to petitioners a

Notice of Determination Concerning Collection Action(s)

Under Section 6320 and/or 6330 (the determination).   The

determination addresses the issues raised by petitioners in

protesting the levy, states that the levy is necessary to

ensure efficient collection of taxes, and confirms that

respondent has met the requirements of the applicable laws

and administrative procedures.

                              OPINION

I.   Sections 6330 and 6331

      Section 6331(a) authorizes the Secretary to levy

against property and property rights where a taxpayer liable

for taxes fails to pay those taxes within 10 days after

notice and demand for payment is made.   Section 6331(d)

requires the Secretary to send written notice of an intent

to levy to the taxpayer, and section 6330(a) requires the

Secretary to send a written notice to the taxpayer of his
                                - 5 -

right to a section 6330 hearing at least 30 days before any

levy is begun.3

       If a section 6330 hearing is requested, the hearing is

to be conducted by Appeals, and, at the hearing, the Appeals

officer conducting it must verify that the requirements of

any applicable law or administrative procedure have been

met.       Sec. 6330(b)(1), (c)(2).   The taxpayer may raise at

the hearing any relevant issue relating to the unpaid tax or

the proposed levy.       Sec. 6330(c)(2)(A).    The taxpayer may

contest the existence or amount of the underlying tax

liability at a hearing if the taxpayer did not receive a

statutory notice of deficiency with respect to the

underlying tax liability or did not otherwise have an

opportunity to dispute that liability.         Sec. 6330(c)(2)(B).

       At the conclusion of the hearing, the Appeals officer

must determine whether and how to proceed with collection,

taking into account, among other things, collection

alternatives proposed by the taxpayer and whether any

proposed collection action balances the need for the

efficient collection of taxes with the legitimate concern of

the taxpayer that the collection action be no more intrusive

than necessary.       See sec. 6330(c)(3).


       3
        A taxpayer receiving a notice of Federal tax lien has
hearing rights similar to the hearing rights accorded a taxpayer
receiving a notice of intent to levy. See sec. 6320(c).
                             - 6 -

       We have jurisdiction to review the Appeals officer’s

determination where we have jurisdiction over the type of

tax involved in the case.    Sec. 6330(d)(1)(A); see Iannone

v. Commissioner, 122 T.C. 287, 290 (2004).     Generally, we

may consider only those issues that the taxpayer raised

during the section 6330 hearing.     See sec. 301.6330-1(f)(2),

Q&A-F5, Proced. & Admin. Regs.; see also Magana v.

Commissioner, 118 T.C. 488, 493.     Where the underlying tax

liability is properly at issue, we review the determination

de novo.    E.g., Goza v. Commissioner, 114 T.C. 176, 181-182

(2000).    Where the underlying tax liability is not at issue,

we review the determination for abuse of discretion.     Id. at

182.    Whether an abuse of discretion has occurred depends

upon whether the exercise of discretion is without sound

basis in fact or law.    See Ansley-Sheppard-Burgess Co. v.

Commissioner, 104 T.C. 367, 371 (1995).

II.    Arguments of the Parties

       Petitioners dispute the adjustments on the Form 4549-CG

(the adjustments).    They also argue that none of their 1995

income tax liability remains unpaid.     Respondent argues that

petitioners failed to raise the adjustments during the

section 6330 hearing and that they did not either during

that hearing or at trial provide any evidence showing
                             - 7 -

any payments in excess of those credited to their account by

respondent.

III.       Discussion

       While petitioners claim that they raised the

adjustments at the section 6330 hearing, respondent’s record

of what occurred at the hearing states that the only issue

petitioners raised was the amount petitioners had paid.

Petitioners have failed to convince us that they raised the

adjustments during the section 6330 hearing.    Also, they

have failed to convince us that, as they claimed at trial,

they were coerced into signing the Form 4549-CG.4     At trial,


       4
        If a taxpayer signs a Form 4549-CG under duress or
coercion, the waivers contained therein of the taxpayer’s rights
to contest the deficiency are invalid. Zapara v. Commissioner,
124 T.C. __, __ (2005) (slip op. at 10). In Zapara, we held:
“[A] taxpayer who has signed a Form 4549-CG waiving his right to
challenge the proposed assessments should be deemed to have had
an opportunity to dispute his tax liabilities and is thereby
precluded from challenging those liabilities.” Id. Previously,
in Aguirre v. Commissioner, 117 T.C. 324, 327 (2001), we held
that, by signing a Form 4549-CG, the taxpayers “expressly waived
the opportunity to obtain prepayment judicial review of their tax
liability for those years.” As reported above, sec.
6330(c)(2)(B) provides that the taxpayer may contest the
existence or amount of the underlying tax liability at a sec.
6330 hearing if the taxpayer did not receive a statutory notice
of deficiency with respect to the underlying tax liability or did
not otherwise have an opportunity to dispute that liability. It
is unclear from the two cases whether a taxpayer who signs a Form
4549-CG following an examination of his return loses his right to
raise the underlying tax liability in a subsequent sec. 6330
hearing because (1) he waived his right to administrative or
judicial consideration of the underlying liability by choosing
not to receive a statutory notice of deficiency or (2) the
examination preceding execution of the Form 4549-CG constituted
                                              (continued...)
                            - 8 -

petitioners produced no evidence that would show any error

in the adjustments.   They produced no evidence showing that

respondent has made any error in crediting their account for

all payments received from them with respect to their 1995

income tax liability, nor did they establish that the

remaining liability is any less than respondent claims it to

be.   Whatever standard of review we apply to Appeals’

determination to proceed with collection by levy of the


      4
      (...continued)
an opportunity to dispute the tax liability recited on the form.
The former interpretation is suggested by Aquirre, in which we
supported our holding by citing Sego v. Commissioner, 114 T.C.
604, 611 (2000), for the proposition that a taxpayer who
deliberately refuses to accept delivery of a notice of deficiency
repudiates his opportunity to contest the notice at Appeals or in
Tax Court. The distinction could be important in a case with
facts different from those before us today. Consider, for
example, a taxpayer who disagrees with an examiner’s proposed
increase in his tax liability and exercises his right to appeal
within the IRS by protesting the proposed increase to Appeals.
Suppose that Appeals rejects his protest, and the Commissioner
sends to the taxpayer’s last known address a notice of deficiency
that conforms to the requirements of sec. 6212. Suppose further
that the notice goes astray and is never delivered, and,
therefore, the taxpayer loses his opportunity to petition the Tax
Court for a redetermination of the deficiency. See sec. 6213(a).
Is the taxpayer precluded from raising the underlying tax
liability in a sec. 6330 hearing (and, if necessary, before the
Tax Court) because he already had an opportunity to dispute the
tax liability, or is he not precluded from raising the liability
because he signed no Form 4549-CG and waived no rights to any
administrative or judicial consideration? If he can raise the
underlying tax liability in a sec. 6330 hearing and, if
dissatisfied with the resolution of the hearing, before the Tax
Court, then in effect the actual receipt rule of sec.
6330(c)(2)(B) replaces the last-known-address-is-adequate rule of
sec. 6212 as a trigger for Tax Court jurisdiction, at least to
the extent the taxpayer wishes to dispute the underlying tax
liability.
                            - 9 -

remaining liability--and even assuming that petitioners

raised the issue of the adjustments in the Form 4549-CG at

the section 6330 hearing--petitioners have failed to prove

that Appeals erred in determining to proceed with collection

of that liability.

IV.   Conclusion

      We sustain the determination.

      To reflect the foregoing,


                                       Decision will be entered

                                  for respondent.
