                        T.C. Memo. 2002-195



                      UNITED STATES TAX COURT



            THOMAS R. HOCHSCHILD, SR., Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 10417-00L.                Filed August 7, 2002.



     Thomas R. Hochschild, Sr., pro se.

     Stephen J. Neubeck, for respondent.



                        MEMORANDUM OPINION


     GERBER, Judge:   This case arises from a petition for

judicial review, under section 6330(d)(1)(A),1 of respondent’s

decision to proceed with collection.   The issue we consider is:




     1
       All section references are to the Internal Revenue Code in
effect for the years in issue.
                                - 2 -

Whether it was an abuse of discretion for respondent to decide to

proceed with collection by means of a notice of levy.

Background

     Petitioner resided at Middleberg Heights, Ohio, at the time

his petition was filed.    Petitioner failed to file 1989, 1990,

and 1991 Federal income tax returns.    Petitioner advanced, as the

reason for failing to file, his belief that the Internal Revenue

Service (IRS) would use the information against petitioner in his

litigation with the National Labor Relations Board (NLRB).

Petitioner’s litigation with the NLRB is not related to

petitioner’s section 6330 hearing.

     Petitioner is a Vietnam veteran and has been diagnosed by

the Department of Veterans Affairs as “suffering from severe,

chronic Post Traumatic Stress Disorder, a psychiatric condition

which developed as a result of * * * [his] combat experience

during the Vietnam war.”    He also suffers from a marked hearing

impairment.

     During the early 1990s, petitioner, as the president of

Crystal Window Cleaning Co., was involved in an injunction

proceeding concerning the NLRB’s charges of unfair labor

practices.    Injunctions had been granted against petitioner and

his company ordering that certain “anti-union behavior” be

discontinued.   Petitioner was found in civil contempt for refusal

to comply with various court orders, and, ultimately, a jury
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found petitioner to be in criminal contempt for which he was

imprisoned.

     Based on petitioner’s allegations that were contained in his

appeal of the contempt conviction, he believed that the Assistant

U.S. Attorney, Federal District Court, and many others were

involved in a conspiracy against him.     In some manner, petitioner

is convinced that the IRS is also conspiring against petitioner.

     After petitioner failed to file returns, respondent’s agent

attempted to elicit returns from petitioner, but none were

forthcoming.   Accordingly, respondent prepared substitute returns

based on Forms 1099 and W-2, Wage and Tax Statement, received

from Crystal Window Cleaning Co., and Hochschild Management, both

of which are petitioner’s companies.     On November 5, 1993,

respondent mailed, via certified mail, a statutory notice of

deficiency to petitioner, at his last known address containing

the determination that petitioner had income tax deficiencies and

additions to tax as follows:

                                    Additions to Tax
     Year      Deficiency   Sec. 6651(a)(1)     Sec. 6654(a)

     1989        $15,201        $2,588                 $94
     1990         12,254         2,001                 494
     1991         15,223         2,728                 600

After two attempts at delivery, the      U.S. Postal Service returned

the notice of deficiency, stamped “unclaimed” to respondent.

     Petitioner did not file a petition, and respondent assessed

the deficiencies and began with collection procedures.       Following
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petitioner’s failure to pay the assessed liabilities, respondent

issued a Collection Due Process Notice and a Notice of Intent to

Levy and Notice of Your Right to Hearing related to petitioner’s

1989, 1990, and 1991 tax years.   On December 28, 1999, petitioner

submitted a timely request for a section 6330 hearing.

     In a letter that was dated November 16, 1999, and received

by respondent on December 17, 1999, petitioner formally requested

information pertaining to respondent’s determination under the

Freedom of Information Act (FOIA).     Petitioner’s request was

denied due to his refusal or failure to agree to pay for copy

costs.

     In a July 20, 2000, letter, Appeals Officer Carolyn Ratzman

proposed an August 22, 2000, conference with petitioner and

invited him to reschedule if that date was inconvenient.

Petitioner, in a July 26, 2000, letter, informed Ms. Ratzman that

he had not requested a conference and explained that he would not

be able to attend a conference due to his disability.     Petitioner

further explained that he was attempting to obtain information

under the FOIA concerning respondent’s determination of his

liabilities.

     In an August 25, 2000, letter, responding to petitioner’s

July 26, 2000, letter, Ms. Ratzman offered petitioner a

conference by telephone.   In that same letter, Ms. Ratzman also

informed petitioner that his request for information under the
                                 - 5 -

FOIA had not been acted upon because more information was

necessary to process the request; i.e., petitioner had not agreed

to pay for the cost of copies.    Along with the offer of a

conference by telephone, Ms. Ratzman enclosed a copy of the

statutory notice concerning the 1989, 1990, and 1991 liabilities.

Ms. Ratzman also warned petitioner that if “[he did not] * * *

contact me by September 8, 2000, I will assume you no longer wish

to pursue this matter with Appeals.      Your case will be closed and

a notice of determination issued.”

     Petitioner took no action, and, on September 28, 2000,

respondent mailed petitioner a Notice of Determination Concerning

Collection Action(s) Under Section 6320 and/or 6330 (the lien or

levy determination), notifying petitioner of the determination to

proceed with collection of the 1989, 1990, and 1991 income tax

liabilities.   On October 4, 2000, petitioner timely petitioned

this Court for review of respondent’s determination under section

6330(d)(1).

     Petitioner’s case was scheduled for trial at the February

11, 2002, Columbus, Ohio, trial session.     Immediately before the

10:00 a.m. calendar call, petitioner became agitated, which

precipitated a conference in chambers with petitioner,

respondent’s counsel, and the trial Judge.     During the chambers

conference, petitioner became highly agitated, and he stated that

he was unable to participate in a trial.     Accordingly, the Court
                               - 6 -

filed petitioner’s trial memorandum as “Petitioner’s Memorandum

Brief”, and petitioner was ordered to file any supplemental

information and/or arguments by March 28, 2002.    Respondent was

ordered to file a reply in the form of a brief by April 29, 2002.

On June 3, 2002, petitioner’s unsolicited response to

respondent’s reply brief was received in the form of a 1-page

letter dated May 12, 2002.

Discussion

     We have jurisdiction over this matter because petitioner

filed a timely petition for review in response to respondent’s

valid notice of determination to proceed with collection.    Sec.

6330(d)(1); Lunsford v. Commissioner, 117 T.C. 159 (2001);

Sarrell v. Commissioner, 117 T.C. 122 (2001); Offiler v.

Commissioner, 114 T.C. 492, 498 (2000); Goza v. Commissioner, 114

T.C. 176, 182 (2000).

     Where the Commissioner intends to levy against property and

property rights of a taxpayer to collect an unpaid tax liability,

section 6331(d) requires that the taxpayer be notified of the

intent to levy.   In addition, section 6330(a) requires that a

written notice be sent to the taxpayer, advising of the right to

a hearing.

     Section 6330(b) affords taxpayers the right to a fair

hearing before an impartial IRS Appeals officer.   Section

6330(c)(1) requires the Appeals officer to obtain verification
                               - 7 -

that applicable legal requirements and/or administrative

procedure have been met.   Section 6330(c)(2)(A) details issues

that may be raised by a taxpayer at the hearing.    The taxpayer

may raise “any relevant issue relating to the unpaid tax or the

proposed levy” including spousal defenses, challenges to the

appropriateness of collection action, and alternatives to

collection.   Sec. 6330(c)(2)(A).   Issues relating to the

underlying tax liability may not be raised if the taxpayer has

received a notice of deficiency or the taxpayer otherwise had an

opportunity to dispute the tax liability.    See sec.

6330(c)(2)(B).

     Petitioner, in his petition to this Court, alleged that,

during 1999, he was notified that he owed income tax and, to

date, he was not able to find out any factual information, even

though he had filed a request under the FOIA.    Petitioner alleged

that the “errors by the I.R.S. is that there are no Factual

evidence in the claim against me, No persons name has come up

that I can find out how the claim came to be and for all

practical purpose[s] it seems that the figures used were made up

out of thin air.”   Petitioner also made an allegation about his

disabled condition and status as a disabled veteran.

     In subsequent documents filed with the Court, the gist of

petitioner’s contentions concerned his status as a disabled

veteran and his anger and fears connected with his legal
                               - 8 -

controversy and incarceration involving the NLRB.   For reasons

that petitioner has not explained, he believes that the

outstanding tax liabilities determined by respondent are somehow

connected to the NLRB matter and that respondent has joined in a

Governmentwide conspiracy against him and his family.

     Considering petitioner’s contentions, we proceed to consider

whether, in the circumstances of this case, there was an abuse of

discretion by respondent in deciding to proceed with collection.

     1. Was Petitioner Entitled To Challenge the Underlying Tax

Liability?

     Under section 6330(c)(2)(B), a taxpayer may challenge the

“underlying tax liability * * * if * * * [the taxpayer] did not

receive any statutory notice of deficiency for such tax liability

or did not otherwise have an opportunity to dispute such tax

liability.”   Respondent mailed, by certified mail, a statutory

notice to petitioner, but petitioner did not claim the notice

after several attempts at delivery by the U.S. Postal Service.

Section 6330(c)(2)(B) generally conditions the right to challenge

the underlying tax liability on a taxpayer’s not receiving a

notice or having an opportunity to dispute the liability.

     In this case, respondent mailed a statutory notice to

petitioner, but it was not claimed.    So we must consider whether

that situation reconciles with the section 6330(c)(2)(B)

condition that a taxpayer “did not receive any statutory notice
                                - 9 -

of deficiency * * * or did not otherwise have an opportunity to

dispute such tax liability.”   In the context of a section 6330

proceeding, we have held that a taxpayer cannot circumvent the

condition by deliberately refusing delivery of the statutory

notice.    See Sego v. Commissioner, 114 T.C. 604 (2000); Baxter v.

Commissioner, T.C. Memo. 2001-300.      In those cases, it was shown

that the taxpayers intentionally refused delivery.     In this case,

respondent has sufficiently shown that a notice was mailed to

petitioner’s last known address and that the U.S. Postal Service

made several attempts at delivery, but the notice was unclaimed.

That evidence is sufficient to raise a presumption of official

regularity and of delivery.    See Sego v. Commissioner, supra at

610-611.

     In addition, petitioner does not argue that he was deprived

of the opportunity to contest the statutory notice in court.

Instead, petitioner argues that respondent had no basis for

issuing the notice.   Petitioner’s argument contains the

assumption that the notice was issued, but that it is without

merit or substance.   Accordingly, we treat this situation as one

where petitioner had the opportunity to contest respondent’s

determination and chose not to.   In the context of a section 6330

hearing, the question of whether the failure to challenge was

deliberate is irrelevant.   The language of the statute only
                                - 10 -

requires that the taxpayer “have an opportunity to dispute such

tax liability.”

       2.   Petitioner’s Arguments Concerning the Underlying Tax

Liability.

       As outlined previously, petitioner, contends that he was not

able to find out any factual information, even though he had

filed a request under the FOIA, and that he questions the

validity or substance of respondent’s determination.     Petitioner

also contends that respondent has conspired with the NLRB as part

of a Governmentwide conspiracy against him and his family.

       Regarding petitioner’s first contention, respondent’s

Appeals officer, in a letter to petitioner, provided him with an

explanation of the source of the income adjustments determined in

the statutory notice.     She explained that the income items were

based on Forms W-2 and 1099 from petitioner’s own companies.

Petitioner wishes to ignore that information and instead argues

that respondent has failed to provide the information he asked

for in his FOIA request.     Again, respondent’s Appeals officer

explained to petitioner, by letter, that his request had not been

honored because he refused or failed to agree to pay the required

fee.

       Petitioner’s FOIA request was asking for the same

information as was provided by respondent’s Appeals officer;

i.e., the basis for the income tax liability.     The documents upon
                              - 11 -

which respondent’s determination was based were documents sent by

petitioner’s companies to respondent.    Accordingly, even if

petitioner were entitled to challenge the merits of the

underlying tax liability, respondent has provided information

upon which the liability is based, and petitioner has shown no

error in respondent’s determination.

     Petitioner’s contention that respondent’s tax determination

is part of a Governmentwide conspiracy against him has not been

shown to be anything more than a figment of petitioner’s

imagination.

     Petitioner, although invited on several occasions for a

face-to-face hearing or one by telephone, did not take advantage

of the offer.   It is again noted that respondent’s failure to

answer petitioner’s FOIA request was due to a procedural

deficiency in petitioner’s request.    More importantly,

respondent’s Appeals officer provided petitioner with available

information in response to the questions and inquiries raised by

petitioner in writing.

     In view of the foregoing, it appears that there has been no

abuse of discretion and that there is no reason why respondent

may not proceed with the proposed collection activity.

                                          Decision will be entered

                                          for respondent.
