                                T.C. Memo. 2015-22



                         UNITED STATES TAX COURT



  DANA KARL BATEMAN AND TRACIE LYNN BATEMAN, Petitioners v.
       COMMISSIONER OF INTERNAL REVENUE, Respondent



      Docket No. 1835-14L.                          Filed February 11, 2015.



      Dana Karl Bateman and Tracie Lynn Bateman, pro sese.

      Louis H. Hill, for respondent.



            MEMORANDUM FINDINGS OF FACT AND OPINION


      FOLEY, Judge: The issue for decision is whether respondent abused his

discretion in sustaining a notice of Federal tax lien (NFTL) relating to petitioners’

2005 and 2006 (years in issue) tax liabilities.
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[*2]                           FINDINGS OF FACT

       Petitioners filed Federal income tax returns relating to the years in issue.

On February 23, 2009, respondent sent petitioners a notice of deficiency relating

to those years. Petitioners received the notice of deficiency and, on October 12,

2010, filed a petition with this Court. On May 16, 2011, the Court dismissed the

petition because it was filed after the 90-day period prescribed by section 6213(a).1

       On February 5, 2013, respondent sent petitioners a Letter 3172, Notice of

Federal Tax Lien Filing and Your Right to a Hearing Under IRC 6320, relating to

the years in issue. Petitioners timely sent respondent a Form 12153, Request for a

Collection Due Process or Equivalent Hearing. In their Form 12153, petitioners

requested a collection due process (CDP) hearing and stated that “this lein is a

little premature and threatens my employment”. On July 18, 2013, petitioners

faxed respondent a Form 433-A, Collection Information Statement for Wage

Earners and Self-Employed Individuals, and a March 8, 2012, letter from the

Department of the Army (i.e., Mr. Bateman’s employer) stating that Mr.

Bateman’s security clearance would be suspended.




       1
      Unless otherwise indicated, all section references are to the Internal
Revenue Code in effect at all relevant times.
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[*3] During a face-to-face CDP hearing, on November 26, 2013, Mr. Bateman

informed the Appeals officer that petitioners disagreed with respondent’s

determination of the underlying tax liabilities relating to the years in issue. Mr.

Bateman further stated that the NFTL was premature and threatened his

employment. The Appeals officer discussed with Mr. Bateman the terms of a

possible installment agreement, pursuant to which the NFTL eventually could be

withdrawn (i.e., after petitioners paid a sufficient amount of their tax liabilities).

Mr. Bateman stated that petitioners could not afford the proposed monthly

payments and rejected the installment agreement. On January 15, 2014,

respondent sent petitioners a notice of determination in which respondent

sustained the NFTL and determined that petitioners “failed to establish grounds

for withdrawal of the lien”. Petitioners, while residing in Ohio, timely filed a

petition with the Court.

                                       OPINION

      Petitioners received a notice of deficiency relating to the years in issue and

thus are precluded from contesting their underlying tax liabilities. See sec.

6330(c)(2)(B); Baltic v. Commissioner, 129 T.C. 178, 183 (2007). Accordingly,

we review respondent’s administrative determination for abuse of discretion. See

Goza v. Commissioner, 114 T.C. 176, 182 (2000).
                                          -4-

[*4] Petitioners contend that the NFTL was filed prematurely and that

respondent abused his discretion by not withdrawing it. To establish that

respondent abused his discretion, petitioners must establish that his actions were

arbitrary, capricious, or without sound basis in law or fact. See Giamelli v.

Commissioner, 129 T.C. 107, 111 (2007); Woodral v. Commissioner, 112 T.C. 19,

23 (1999). The Appeals officer reviewed the information petitioners submitted,2

evaluated their contentions, and verified that the requirements of applicable law

and administrative procedure had been met. See sec. 6330(c). In addition, the

Appeals officer balanced the need for efficient collection of taxes with petitioners’

concerns that the collection action be no more intrusive than necessary. See sec.

6330(c)(3)(C). Indeed, the Appeals officer raised with petitioners the possibility

of an installment agreement pursuant to which the NFTL could have been

withdrawn. Petitioners, however, rejected the agreement. Respondent reasonably

determined that the NFTL was the most efficient means of protecting the public

interest relating to petitioners’ unpaid tax liabilities. See id. Furthermore,

respondent determined that the NFTL was not premature and that withdrawal of

the NFTL would not facilitate the collection of petitioners’ tax liabilities. See sec.

      2
       The letter from the Department of the Army predated the NFTL by
approximately 11 months and did not establish why Mr. Bateman’s security
clearance was denied.
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[*5] 6323(j)(1)(A), (C). In short, respondent’s determination not to withdraw the

NFTL was not arbitrary or capricious. See Woodral v. Commissioner, 112 T.C. at

23.

      Contentions we have not addressed are irrelevant, moot, or meritless.

      To reflect the foregoing,


                                                   Decision will be entered

                                             for respondent.
