                        T.C. Memo. 2011-215



                      UNITED STATES TAX COURT



         AKRAM IBRAHIM AND RAEDA KISWANI, Petitioners v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 8315-09.              Filed August 31, 2011.



     Akram Ibrahim and Raeda Kiswani, pro sese.

     Scott B. Burkholder, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     FOLEY, Judge:   The issue for decision is whether

respondent abused his discretion in determining that petitioners

are not entitled to abatement of interest pursuant to
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section 6404(e)1 relating to 2001, 2002, and 2003 (years in

issue).

                           FINDINGS OF FACT

     Petitioners jointly filed their 2002 Federal income tax

return on April 15, 2003, and their 2001 Federal income tax

return on April 29, 2003.     In November 2003, the Los Angeles

County Sheriff’s Department (Sheriff’s Department), in connection

with a criminal investigation against petitioner Akram Ibrahim,

seized petitioners’ personal and business records.2    On July 27,

2004, petitioners’ 2002 and 2003 returns were assigned to Revenue

Agent Richard Ng (RA Ng).     In a Letter 2205-A, dated September

17, 2004, RA Ng informed petitioners that their 2001 and 2002

returns had been selected for examination.3

         On September 30, 2004, RA Ng mailed petitioners a Letter

3253 in which RA Ng stated that “This letter confirms * * * [our

appointment for October 20, 2004,] that we scheduled during our

telephone conversation on September 29, 2004.”     Attached to the



     1
      Unless otherwise indicated, all section references are to
the Internal Revenue Code as amended, and all Rule references are
to the Tax Court Rules of Practice and Procedure.
     2
      In 2006, petitioner Akram Ibrahim pleaded guilty in Los
Angeles County Superior Court to three counts of unlawful use of
personal identity and was required to repay $114,773 to defrauded
credit card companies.
     3
      As of Sept. 17, 2004, the date RA Ng mailed petitioners
Letter 2205-A, petitioners had not filed a Federal income tax
return relating to 2003.
                               - 3 -

letter was Form 4564, Information Document Request, which

described various documents and information that petitioners were

required to bring to the scheduled meeting.   On October 15, 2004,

RA Ng received Form 2848, Power of Attorney and Declaration of

Representative, from Dean Alkalla (Mr. Alkalla), petitioners’

certified public accountant.

     In a Letter 3164 G, dated January 5, 2005, RA Ng requested

that petitioners provide additional information, including

information relating to documents previously seized by the

Sheriff’s Department.   In addition, RA Ng informed petitioners

that he would “contact other persons to obtain * * * [documents]

and any related information” that petitioners had not provided.

On January 24, 2005, RA Ng contacted the Sheriff’s Department and

began to review the seized documents.   On April 26, 2005, RA Ng

interviewed petitioner Akram Ibrahim at Mr. Alkalla’s office.

     Petitioners, on July 21, 2005, signed and filed their 2003

Federal income tax return and filed amended 2001 and 2002

returns.   Soon thereafter, RA Ng began examining petitioners’

2003 return.   On September 12, 2005, RA Ng mailed a seventh Form

4564, requesting that petitioners submit certain information.     At

their October 17, 2005, meeting, petitioners failed to provide

the information RA Ng had requested.    On January 8, 2006, RA Ng

mailed petitioners a Letter 907 in which he requested that

petitioners sign the attached Forms 872, Consent to Extend the
                               - 4 -

Time to Assess Tax, relating to 2001 and 2002.   Over the next

several months, RA Ng spoke periodically with petitioners and Mr.

Alkalla; continued to examine petitioners’ 2001, 2002, and 2003

returns; and began examining petitioners’ 2004 return.

     On September 5, 2006, RA Ng issued petitioners a Letter 950

(i.e., a 30-day letter) relating to 2001, 2002, and 2003.    In the

letter, respondent proposed adjustments to petitioners’ 2001,

2002, and 2003 returns and determined proposed deficiency

amounts, accuracy-related penalties, and an addition to tax for

failure to file.   Petitioners appealed the “IRS findings for the

year 2003” and, on October 5, 2006, requested a conference with

respondent’s Appeals Office.   On January 9, 2007, respondent’s

Appeals Office mailed petitioners and Mr. Alkalla each a letter

explaining the appeal process and acknowledging that the Appeals

Office had received petitioners’ case for consideration on

December 14, 2006.   Attached to the letter was Notice 1016, How

to Stop Interest on your Account.   Respondent’s Appeals Office

reviewed petitioners’ file and attempted to negotiate a

settlement.

     On October 18, 2007, petitioners signed Forms 872 relating

to 2001 through 2004.   In November 2007, petitioners and

respondent’s Appeals Office agreed to proposed adjustments to

petitioners’ 2001, 2002, and 2003 returns, and on January 3,
                               - 5 -

2008, respondent’s Appeals Office received from petitioners

signed agreements relating to the years in issue.

     On March 14, 2008, petitioners submitted to respondent three

Forms 843, Claim for Refund and Request for Abatement

(collectively, abatement requests), relating to 2001, 2002, and

2003.   In the abatement requests, petitioners requested that the

Internal Revenue Service (IRS) “remove all penalties and

interest” relating to the years in issue.   On October 23, 2008,

respondent mailed petitioners a memorandum denying petitioners’

abatement requests.

     On December 12, 2008, respondent issued petitioners a Letter

3180, Notice of Final Determination, relating to the years in

issue, which provided that there was no unreasonable error or

delay relating to the performance of a ministerial or managerial

act during the examination of petitioners’ 2001, 2002, and 2003

returns.   On April 6, 2009, petitioners, while residing in

California, filed their petition with the Court.    In their

petition, petitioners emphasized that “If the sheriff didn’t

seize * * * [their] documents or at least returned it in full

* * * [petitioners] wouldn’t have this issue with the I.R.S.”   On

March 15, 2010, the parties filed a stipulation of facts with the

Court and a trial was held in Los Angeles, California.
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                              OPINION

     Section 6404(e)(1)(A) provides that the Commissioner may, at

his discretion, abate the assessment of interest on any

deficiency in tax attributable, in whole or in part, to any

unreasonable error or delay by an IRS officer or employee in

performing a ministerial or managerial act.   See also Lee v.

Commissioner, 113 T.C. 145, 149-150 (1999); Woodral v.

Commissioner, 112 T.C. 19, 23 (1999); sec. 301.6404-2(b), Proced.

& Admin. Regs.   The temporary or permanent loss of records is a

managerial act which may be grounds for abatement of interest.

See sec. 301.6404-2(b)(1), Proced. & Admin. Regs.   The mere

passage of time, however, does not establish error or delay in

performing a ministerial or managerial act.   See Lee v.

Commissioner, supra at 150-151.

     Section 6404(e) applies only after the Commissioner has

contacted the taxpayer in writing about the deficiency and this

Court will give due deference to the Commissioner’s use of

discretion.   See Rule 280(b); Krugman v. Commissioner, 112 T.C.

230, 239 (1999); Woodral v. Commissioner, supra at 23; Mailman v.

Commissioner, 91 T.C. 1079, 1082 (1988).   The taxpayer bears the

burden of proof and, to meet this burden, must establish that the

Commissioner abused his discretion by exercising it arbitrarily,

capriciously, or without sound basis in fact or law.     Woodral v.

Commissioner, supra at 23; see also sec. 6404(h)(1); Rule 142(a).
                              - 7 -

To qualify for abatement of interest, the taxpayer must identify

an error or delay by the IRS in performing a ministerial or

managerial act, establish a correlation between the error or

delay by the IRS and a specific period for which interest should

be abated, and show that the taxpayer’s examination would have

been concluded earlier but for the IRS’ error or delay.    See sec.

6404(e)(1); sec. 301.6404-2, Proced. & Admin. Regs.

     Petitioners contend that RA Ng’s acts during the examination

of petitioners’ 2001, 2002, and 2003 returns caused unreasonable

errors and delays during the audit and as a result, respondent

abused his discretion in failing to abate “all penalties and

interest” relating to the years in issue.    We do not have

jurisdiction to review petitioners’ contentions relating to

abatement of penalties or additions to tax.    See sec. 6404(f);

Banat v. Commissioner, 109 T.C. 92 (1997).    Petitioners requested

abatement of “all” interest, but the record does not establish

the requisite link between the alleged delay and a specific

period during which interest accrued.   See sec. 6404(e)(1); S.

Rept. 99-313, at 208 (1986), 1986-3 C.B. (Vol. 3) 1, 208; H.

Rept. 99-426, at 844 (1985), 1986-3 C.B. (Vol. 2) 1, 844; sec.

301.6404-2, Proced. & Admin. Regs.    Petitioners also contend that

RA Ng lost, and made multiple requests for, previously submitted
                                 - 8 -

documents.4   The record, however, does not reveal which documents

were lost and which documents were requested multiple times.       In

short, the IRS did not err or delay in performing a ministerial

or managerial act that would establish an abuse of discretion in

denying petitioners’ abatement requests.       See sec. 6404(e)(1);

sec. 301.6404-2, Proced. & Admin. Regs.       Accordingly,

respondent’s failure to abate interest relating to the years in

issue was not an abuse of discretion.

     Contentions we have not addressed are irrelevant, moot, or

meritless.

     To reflect the foregoing,


                                              Decision will be entered

                                         for respondent.




     4
      Petitioners also contend that there was an unexplained gap
in RA Ng’s case activity record between Sept. 12, 2005, and Oct.
6, 2006. The alleged gap was a typing error and not a period of
inactivity (i.e., RA Ng typed “10-6-06” instead of “10-6-05” and
“2-2-2005” instead of “2-2-2006”). Cf. Lee v. Commissioner, 113
T.C. 145, 150-151 (1999).
