                           T.C. Memo. 2006-181



                         UNITED STATES TAX COURT



                      BARRY SHRIER, Petitioner v.
             COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No.     8725-05L.              Filed August 29, 2006.




     Cheryl R. Frank and Gerald W. Kelly, Jr., for petitioner.

     Vivian N. Rodriguez, for respondent.



                MEMORANDUM FINDINGS OF FACT AND OPINION


        FOLEY, Judge:   The issue for decision is whether respondent

abused his discretion in proceeding with collection of

petitioner’s income tax liabilities relating to 1989 through

2000.
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                          FINDINGS OF FACT

     On May 15, 2003, respondent issued petitioner a Final Notice

of Intent to Levy and Notice of Your Right to a Hearing relating

to 1989 through 2000 (the years in issue).    In the notice,

respondent determined that petitioner was liable for taxes and

additions to tax totaling $130,835 and $41,445, respectively,

relating to the years in issue.

     On May 27, 2003, petitioner timely filed a Form 12153,

Request for a Collection Due Process Hearing (request), and

stated that he did “not have sufficient assets to cover the

assessed liabilities.”    On November 11, 2003, petitioner sent

respondent a Form 433-A, Collection Information Statement for

Wage Earners and Self-Employed Individuals.    On November 25,

2003, petitioner supplemented his Form 433-A with copies of

statements relating to petitioner’s checking, credit card, and

telephone accounts.    Petitioner also attached a copy of a

statement relating to a car lease in the name of Leo Shrier,

petitioner’s father.

     On November 25, 2003, respondent conducted a telephone

conference with petitioner.    During the conference, petitioner

requested that his account be placed in “currently not

collectible status” because he was unemployed.    On February 13,

2004, petitioner’s counsel informed respondent that petitioner
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was employed and would submit an offer-in-compromise (OIC)

relating to his income tax liabilities.   While petitioner was

unemployed, petitioner’s parents made several deposits into his

checking account (deposits).   In a letter dated February 27,

2004, respondent requested that petitioner provide an “affidavit

from * * * [petitioner’s] parents as to the amount of money they

gave him and * * * cancelled checks corresponding to the

deposits.”   Respondent also asked petitioner to explain the car

lease expense.

     On March 23, 2004, petitioner submitted to respondent a Form

656, Offer in Compromise, in the amount of $2,000 based on doubt

as to collectibility (March OIC).   Petitioner attached an updated

Form 433-A to the March OIC but did not attach any additional

financial documents.   In a letter dated November 17, 2004,

respondent requested additional financial information.   In a

second letter, also dated November 17, 2004, respondent requested

that petitioner “provide the documents specified on Form 433A

* * * [and] an affidavit from * * * [petitioner’s] parents as to

the amount of money they gave him.”    Respondent warned petitioner

that if the requested documents were not received by December 17,

2004, the March OIC would not be accepted.

     On December 17, 2004, petitioner sent respondent an amended

OIC in the amount of $2,000 based on doubt as to collectibility
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and effective tax administration (December OIC).    Petitioner

attached to the December OIC an updated Form 433-A, statements

relating to petitioner’s checking account, statements relating to

an employee profit-sharing plan, and wage statements from his

current employer.

       In a letter dated March 3, 2005, respondent stated that the

December OIC was insufficient because petitioner did not provide

the requisite documentation relating to petitioner’s ability to

pay.    Respondent also informed petitioner that his claimed living

expenses (e.g., food, housing, and transportation) were in excess

of the allowable amount.    Respondent also asserted that

petitioner had not disclosed that he was living with another

individual.

       On April 15, 2005, respondent issued petitioner a Notice of

Determination Concerning Collection Action(s) Under Section 6320

and/or 6330 relating to 1989 and 1991 through 2000.    On May 12,

2005, petitioner, while residing in Aventura, Florida, filed his

petition with the Court relating to the years in issue and 2001.

On July 15, 2005, respondent issued petitioner a Decision Letter

Concerning Equivalent Hearing Under Section 6320 and/or 6330 of

the Internal Revenue Code relating to 1990.

       On March 2, 2006, the Court filed respondent’s motion to

dismiss for lack of jurisdiction and to strike as to the taxable
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year 2001.   On March 29, 2006, the Court granted respondent’s

motion.

                              OPINION

     Petitioner does not dispute the underlying tax liabilities.

Where the validity of the liability is not at issue, the Court

reviews the Commissioner’s administrative determination for abuse

of discretion.   Goza v. Commissioner, 114 T.C. 176, 182 (2000).

Respondent’s determination will be sustained unless the

determination is arbitrary, capricious, clearly unlawful, or

without sound basis in fact or law.     Woodral v. Commissioner, 112

T.C. 19, 23 (1999).

     Petitioner contends that respondent abused his discretion by

not accepting the December OIC.   Section 71221 authorizes

respondent to grant an OIC as an alternative to pursuing a

collection action, but petitioner must provide detailed financial

statements and supporting documentation.    Sec. 301.7122-1(d)(2),

Proced. & Admin. Regs.   Respondent, on numerous occasions,

requested supporting documentation from petitioner.    Petitioner,

however, failed to provide the requested information.    Indeed,

respondent was unable to properly evaluate the December OIC

because petitioner did not provide the supporting documentation


     1
        Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the years in issue.
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relating to petitioner’s expenses (i.e., housing, food,

transportation, and health care) and certain deposits.

Accordingly, respondent did not abuse his discretion by not

accepting an OIC and proceeding with the proposed collection

action.   Id.

     Contentions we have not addressed are irrelevant, moot, or

meritless.

     To reflect the foregoing,


                                              Decision will be entered

                                         for respondent.
