                        T.C. Memo. 2007-235



                       UNITED STATES TAX COURT



       MICHAEL C. HOLLEN & JOAN L. HOLLEN, Petitioners v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 21915-05L.                Filed August 16, 2007.



     Michael C. Hollen and Joan L. Hollen, pro sese.

     Lisa K. Hunter, for respondent.



                         MEMORANDUM OPINION


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

dent’s motion for summary judgment (respondent’s motion).     We

shall grant respondent’s motion.

                             Background

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

following.
                               - 2 -

     Petitioners resided in Waterloo, Iowa, at the time they

filed the petition in this case.

     Petitioners jointly filed a Federal income tax (tax) return

for their taxable year 1988.

     On December 18, 1996, respondent issued to petitioners a

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

1988.   Petitioners filed a petition with the Court with respect

to that notice and commenced the case at docket No. 5586-97.    (We

shall refer to the case at docket No. 5586-97 as petitioners’ Tax

Court case.)

     On January 9, 2001, the Court entered a decision in peti-

tioners’ Tax Court case (Tax Court decision).   That decision

provided in pertinent part:

           Pursuant to the opinion of the Court filed March
     24, 2000, and incorporating herein the facts recited in
     respondent’s computation as the findings of the Court,
     it is

          ORDERED AND DECIDED: That there is a deficiency in
     income tax due from petitioners for the taxable year
     1988 in the amount of $55,550;

          That there is an addition to tax due from peti-
     tioners for the taxable year 1988, under the provisions
     of I.R.C. section 6653(a), in the amount of $2,777.50;
     and

          That there is an addition to tax due from peti-
     tioners for the taxable year 1988, under the provisions
     of I.R.C. section 6661, in the amount of $13,887.50.

     On a date not disclosed by the record, petitioners filed a

notice of appeal with the United States Court of Appeals for the
                              - 3 -

Eighth Circuit (Court of Appeals for the Eighth Circuit) with

respect to the Tax Court decision.    On January 16, 2002, that

Court affirmed the Tax Court decision.    Hollen v. Commissioner,

25 Fed. Appx. 484 (8th Cir. 2002).

     On June 5, 2001, respondent assessed tax of $55,550, addi-

tions to tax under sections 6653(a)1 and 6661 of $67,978.11 and

$13,887.50, respectively, and interest as provided by law for

petitioners’ taxable year 1988.   On February 25, 2002, respondent

assessed additional interest as provided by law.    (We shall refer

to any unpaid assessed amounts with respect to petitioners’

taxable year 1988, as well as interest as provided by law accrued

after February 25, 2002, as petitioners’ unpaid 1988 liability.)

     Respondent issued to petitioners the notice and demand for

payment required by section 6303(a) with respect to petitioners’

unpaid 1988 liability.

     On December 15, 2004, respondent issued to petitioners a

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

(notice of intent to levy) with respect to their taxable year

1988.

     On December 28, 2004, respondent filed a notice of Federal

tax lien (tax lien filing) with respect to petitioners for their

taxable year 1988.


     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.
                               - 4 -

     On December 29, 2004, respondent issued to petitioners a

notice of Federal tax lien filing and your right to a hearing

(notice of tax lien) with respect to their taxable year 1988.

     On January 5, 2005, in response to the notice of intent to

levy, petitioners mailed to respondent Form 12153, Request for a

Collection Due Process Hearing (Form 12153), and requested a

hearing with respondent’s Appeals Office (Appeals Office).

     On January 18, 2005, in response to the notice of tax lien,

petitioners mailed to respondent Form 12153 and requested a

hearing with the Appeals Office.

     In Forms 12153 that petitioners submitted with respect to

the notice of intent to levy and the notice of tax lien, respec-

tively, petitioners stated:

     Income from a partnership was reported on the 1988 Form
     1120 filed by Michael C. Hollen, D.D.S., P.C. That
     same income is alleged by the I.R.S. to be reported by
     Dr. and Mrs. Hollen. That constitutes double taxation.
     That issue was addressed by the Supreme Court in U.S.
     v. Supple-Biddle Hardware Co., 265 U.S. 189, “Such a
     duplication, even in an exigent war tax measure is to
     be avoided.” [Reproduced literally.]

     On May 6, 2005, a settlement officer with the Appeals Office

(settlement officer) held a telephonic conference (May 6, 2005

conference) with petitioner Michael C. Hollen (Mr. Hollen) with

respect to the notice of intent to levy and the notice of tax

lien.   During that conference, Mr. Hollen raised the following

five issues with respect to petitioners’ taxable year 1988:

(1) The correctness of the underlying tax liability, (2) the
                               - 5 -

liability of petitioner Joan L. Hollen (Ms. Hollen) for the tax,

(3) the propriety of filing a tax lien against Ms. Hollen,

(4) the timing of the tax lien filing, and (5) the possibility

that a “slander of title action” might be pursued against the

Internal Revenue Service (IRS) under Iowa law because the tax

lien filing was filed against Ms. Hollen.

     During the May 6, 2005 conference, the settlement officer

addressed each of the issues that Mr. Hollen raised during that

conference.   With respect to Mr. Hollen’s claim that Ms. Hollen

is not liable for the tax, the settlement officer advised Mr.

Hollen that if Ms. Hollen believed that she was not liable for

petitioners’ unpaid 1988 liability, she should file Form 8857,

Request for Innocent Spouse Relief (And Separation of Liability

and Equitable Relief) (Form 8857).

     On May 16, 2005, the settlement officer received Form 8857

from Ms. Hollen (Ms. Hollen’s Form 8857).   The settlement officer

forwarded Ms. Hollen’s Form 8857 to the IRS innocent spouse unit.

On October 18, 2005, the IRS innocent spouse unit notified the

settlement officer that it had concluded that Ms. Hollen was not

entitled to relief under section 6015.   Thereafter, the settle-

ment officer began to prepare her determination with respect to

the notice of intent to levy and the notice of tax lien.

     On October 20, 2005, the settlement officer called (October

20, 2005 call) Ms. Hollen and informed her that Ms. Hollen’s
                                 - 6 -

request for relief under section 6015 would be denied, that the

Appeals Office would issue to Ms. Hollen a notice of determina-

tion denying that request, and that Ms. Hollen would have the

opportunity to petition the Tax Court for review of that determi-

nation.   During the October 20, 2005 call, the settlement officer

asked to speak with Mr. Hollen, but Ms. Hollen indicated that he

was at work.   During that call, the settlement officer also

indicated that Mr. Hollen and Ms. Hollen would each receive a

notice of determination with respect to the notice of intent to

levy and the notice of tax lien.

     On October 28, 2005, the Appeals Office issued to Ms. Hollen

a “Notice of Determination Concerning Your Request for Relief

from Joint and Several Liability under Section 6015” (notice of

determination under section 6015) with respect to Ms. Hollen’s

Form 8857 in which the Appeals Office denied Ms. Hollen’s request

for relief under section 6015.    On October 28, 2005, the Appeals

Office sent a letter to Mr. Hollen notifying him that it had made

a determination to deny that request.

     On October 28, 2005, the Appeals Office issued to each

petitioner a notice of determination concerning collection

action(s) under section 6320 and/or 6330 (notice of determination

under sections 6320 and 6330) with respect to petitioners’

taxable year 1988.   Those notices were identical and stated in

pertinent part:
                              - 7 -

     Summary of Determination
     The Notice of Intent to Levy and the Notice of Federal
     Tax Lien were issued properly.

An attachment to the notice of determination under sections 6320

and 6330 issued to each petitioner stated in pertinent part:

                   SUMMARY AND RECOMMENDATION

     The issuance of the Notice of Intent to Levy was appro-
     priate. The filing of the Notice of Federal Tax Lien
     was also appropriate.

                        BRIEF BACKGROUND

     The Notice of Intent to Levy (“Letter 1058”) was issued
     12/15/2004. Internal Revenue Code 6330 provides for a
     Collection Due Process hearing for requests made within
     30 days of the issuance of the Notice of Intent to
     Levy. Your request for a hearing was received on
     1/5/2005 and is considered timely.

     A Notice of Federal Tax Lien Filing (“NTFL”) and Your
     Right to a Hearing under IRC 6320 was mailed to you by
     certified mail on 12/29/2004. This letter notified you
     that you had until 2/4/2005 to make a timely request
     for a hearing. Your request for a hearing was received
     on 1/18/2005 and is considered timely.

     You had the opportunity to raise any relevant issues
     relating to the unpaid tax, the Letter 1058 and the
     NFTL at a Collection Due Process hearing. Appeals
     Settlement Officer * * * conducted your requested
     hearing on 5/6/2005, via telephone. You were offered
     an opportunity to meet in person. * * * [The settle-
     ment officer] had no prior involvement with the tax
     liability at issue.

     Basis for the Tax Liability

     The liability is based upon a tax court decision.
                         - 8 -

                DISCUSSION AND ANALYSIS

Matters considered pursuant to IRC § 6320
Verification of Legal and Procedural Requirements

Prior to filing a NFTL, IRS must issue a notice and
demand for tax for each liability to be listed on the
notice. If the tax is not paid within 10 days of such
notice and demand, a statutory lien arises on the 11th
day. Notice of the statutory lien may be filed any
time on or after the 11th day. Finally, IRS must no-
tify the taxpayer of the filing of the NFTL and his/her
right to a hearing within 5 business days of such
filing.

Administrative procedures require the Revenue Officer
to make a reasonable effort to contact the taxpayer to
advise that a NFTL may be filed if payment is not made
so that the taxpayer has an opportunity to make payment
or other security arrangements. The Revenue Officer
must also explain the effect of the NFTL filing on
normal business operations and/or the taxpayer’s credit
rating. Administrative procedures in place at the time
IRS requested the NFTL to be filed indicate that such
action should not be taken if the taxpayer is working
with IRS to resolve tax matters.

Transcripts of your account show the notice of tax and
demand for payment was issued on 7/2/2001. Letter 1058
was sent 12/15/2004. The NFTL was filed on 12/28/2004.
Letter 3172 was mailed on 12/29/2004.

The NFTL was filed more than 10 days after the notice
of tax and demand for payment was mailed (date of
assessment), and that Letter 3172, Notice of Federal
Tax Lien Filing and Your Right to a Hearing Under IRC
§6320, was mailed within 5 business days of the date of
filing.

Administratively, the case file shows the Revenue
Officer was in direct contact with your prior to filing
the NFTL.

Based upon the best available information, it appears
as though all applicable legal and administrative
procedures were followed in filing the NFTL and were
appropriate under the circumstances.
                         - 9 -

Matters considered pursuant to IRC § 6330
Verification of Legal and Procedural Requirements

The legal requirements prior to taking general enforce-
ment action are issuance of notice and demand for tax,
notice of intent to levy and notice of the taxpayer’s
right to a hearing. In addition to the legal require-
ments, current administrative procedures governing
Letter 1058 issuance require the Revenue Officer to
have knowledge of a potential levy source and plan levy
as the next intended action.

Transcripts of account show the notice of tax and
demand for payment was issued 7/2/2001 and Letter 1058
was issued 12/15/2004. Administratively, the Revenue
Officer had knowledge of a usable levy source and levy
appears to have been the next intended action because
you had not made any proposals to resolve your tax
debt.

Based upon the best available information, it appears
as though all applicable legal and administrative
procedures were properly followed in issuing Letter
1058 and were appropriate under the circumstances.

Relevant Issues Presented by the Taxpayer

In your written request for a hearing you indicate you
disagree with the liability. During the CDP hearing
you raised issues concerning the tax liability. * * *
[The settlement officer] advised you since you previ-
ously had the underlying tax liability considered by
Appeals, you were precluded from having this matter
considered again at the CDP hearing. Since you previ-
ously had the underlying tax liability considered by
Appeals, you are precluded from having the liability
considered again under Collection Due Process.

Joan [Ms. Hollen] filed a request for innocent spouse
relief, Form 8857, received 5/16/2005. The request has
been denied. An innocent spouse final determination
letter has been sent to Joan denying her claim.

Challenges made by the taxpayer to the appropriateness
of the collection action

You raised the issue that the NFTL was filed too
quickly. As noted above, the notice of tax and demand
                             - 10 -

     for payment was issued on 7/2/2001. Letter 1058 was
     sent 12/15/2005. The NFTL was filed on 12/28/2004.
     The Revenue Officer followed all administrative proce-
     dures in determining the NFTL should be filed.

     You raised no issues concerning IRS’ compliance with
     its procedures in filing in issuing the Letter 1058.

     You offered no collection alternatives.

     Balancing Efficient Collection With Intrusiveness of
     Proposed Action

     IRC §6320 and IRC § 6330 requires the Appeals Officer
     to consider whether any collection action balances the
     need for efficient collection of the unpaid taxes with
     the legitimate concern that such action be no more
     intrusive than necessary. It is my judgment that the
     filing of the NFTL and the proposed levy action appear
     to be no more intrusive than necessary for the effi-
     cient collection of the unpaid tax. IRS is justified
     in proceeding with the proposed levy action as it sees
     fit. [Reproduced literally.]

     Petitioners filed a petition with the Court with respect to

the notice of determination under sections 6320 and 6330.2     In

that petition, petitioners alleged:

          4. The determination that the Notice of Intent to
     Levy and the Notice of Federal Tax Lien were issued
     properly is based upon the following errors:

               a. Error in concluding that the underly-
               ing tax liability had previously been
               considered by appeals thereby precluding
               Petitioners from having the liability
               considered again.

          5. The law and facts upon which the Petitioners
     rely, as the basis of their case are as follows:




     2
      Ms. Hollen did not file a petition with the Court with
respect to the notice of determination under section 6015.
                             - 11 -

               a. The United States Tax Court, as af-
               firmed by the United States Court of
               Appeals for the Eighth Circuit ruled
               that certain income was taxable to Peti-
               tioners for 1988 based upon a Revenue
               Agents report. That same income had
               been reported by Petitioners’ corpora-
               tion its 1998 income tax return. Peti-
               tioners filed Form 1040X, Amended U.S.
               Individual Income Tax Return in order to
               correct the duplication. The U.S. Su-
               preme Court, in U.S. v. Supplee-Biddle
               Hardware Co., 265 U.S. 189, ruled that
               “Such duplication even in an exigent war
               tax measure is to be avoided.” Respon-
               dent has not responded to nor taken any
               action respecting Form 1040X.
               Petitioner had requested that this issue
               be considered at the Collection Due
               Process Hearing. [Reproduced
               literally.]

     Upon reviewing respondent’s administrative record with

respect to petitioners’ taxable year 1988, respondent’s counsel

discovered that the $67,978.11 addition to tax under section

6653(a) that respondent assessed on June 5, 2001, exceeded the

amount of the addition to tax under section 6653(a) in the Tax

Court decision, which was $2,777.50.   Upon the request of respon-

dent’s counsel, the settlement officer reviewed the assessments

that respondent made with respect to petitioners’ taxable year

1988 and took the action necessary to have the addition to tax

under section 6653(a) and interest thereon abated to the extent

they exceeded the addition to tax under section 6653(a) in the

Tax Court decision and interest thereon.
                              - 12 -

                            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.   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 are no genuine issues of material fact

regarding the questions raised in respondent’s motion.

     A taxpayer may raise challenges to the existence or the

amount of the taxpayer’s underlying tax liability if the taxpayer

did not receive a notice of deficiency or did not otherwise have

an opportunity to dispute the tax liability.   Sec. 6330(c)(2)(B).

     Respondent issued a notice of deficiency to petitioners with

respect to their taxable year 1988.    Petitioners filed a petition

with the Court with respect to that notice.    On January 9, 2001,

the Court entered a decision in petitioners’ Tax Court case,

which was affirmed by the Court of Appeals for the Eighth Cir-

cuit.   The Tax Court decision provided, inter alia, that for

petitioners’ taxable year 1988 there were a deficiency of $55,550

in petitioners’ tax and additions to that tax under sections

6653(a) and 6661 of $2,777.50 and $13,887.50, respectively.     On

the instant record, we find that petitioners may not challenge

the existence or the amount of the underlying tax liability for

their taxable year 1988.

     Where, as is the case here, the validity of the underlying
                              - 13 -

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, 114 T.C. 604, 610

(2000); Goza v. Commissioner, 114 T.C. 176, 181-182 (2000).

     Based upon our examination of the entire record before us,

we find that, except for the determinations relating to respon-

dent’s assessment for petitioners’ taxable year 1988 of excessive

amounts of the addition to tax under section 6653(a) and interest

thereon that respondent conceded,3 respondent did not abuse

respondent’s discretion in making the determinations in the

notice of determination under sections 6320 and 6330 with respect

to petitioners’ taxable year 1988.

     We have considered all of the contentions and arguments of

the parties that are not discussed herein, and we find them to be

without merit, irrelevant, and/or moot.

     On the record before us, we shall grant respondent’s motion.

     To reflect the foregoing,

                                      An order granting respondent’s

                                 motion and an appropriate decision

                                 for respondent will be entered.




     3
      In respondent’s motion, respondent states: “Respondent has
taken the necessary steps to abate the [$67,978.11] excess
penalty (i.e., to the extent that it exceeds $2,777.50) and
interest thereon.”
