                         T.C. Memo. 2002-177



                       UNITED STATES TAX COURT



                 MICHAEL SPONBERG, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 7073-00L.               Filed July 29, 2002.



     Michael Sponberg, pro se.

     Willis B. Douglass, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     CHIECHI, Judge:    The petition in this case was filed in

response to a “NOTICE OF DETERMINATION CONCERNING COLLECTION

ACTION(S) UNDER SECTION 6320 and/or 6330" (notice of determina-

tion).

     We must consider whether respondent correctly determined in

the notice of determination to proceed with the collection action
                               - 2 -

with respect to each of petitioner’s taxable years 1987 and 1990.

We hold that, except for respondent’s concession with respect to

petitioner’s taxable year 1987, respondent did.

                        FINDINGS OF FACT

     Some of the facts have been stipulated and are so found with

one exception stated herein.

     Petitioner resided in Palos Verdes Estates, California, at

the time he filed the petition in this case.

     On August 15, 1985, April 15, 1986, and October 11, 1988,

respectively, petitioner filed Forms 1040, U.S. Individual Income

Tax Return (Form 1040), for his taxable years 1984 (1984 return),

1985 (1985 return), and 1986 (1986 return).    As reflected in Form

4340, Certificate of Assessments, Payments, and Other Specified

Matters (Form 4340), with respect to each of petitioner’s taxable

years 1984 and 1985 and in respondent’s complete statement of

petitioner’s account with respect to his taxable year 1986

(respondent’s statement of petitioner’s account with respect to

his taxable year 1986),1 respondent assessed on various dates the

following amounts of Federal income tax (tax), additions to tax,

and interest:



     1
      We attach hereto as Appendix A, Appendix B, and Appendix C,
respectively, and incorporate herein by this reference, the
information reflected in Form 4340 with respect to each of
petitioner’s taxable years 1984 and 1985 and respondent’s state-
ment of petitioner’s account with respect to his taxable year
1986.
                              - 3 -

                                                            Total
 Year        Tax      Additions to Tax   Interest       Liability
                                                     1
 1984       $6,266        $1,823.10      $4,203.66     $12,306.76
 1985        9,100         1,414.15      10,113.61      20,627.76
                                                         2
 1986          886           327.49         621.71         1,845.20
     1
       Form 4340 with respect to petitioner’s taxable year 1984
also reflects a $14 charge for “FEES AND COLLECTION COSTS”,
making the total liability for that year $12,306.76.
     2
       Respondent’s statement of petitioner’s account with respect
to his taxable year 1986 also reflects a $10 “COLLECTION CHARGE-
LIEN FEE”, making the total liability for that year $1,845.20.

     On December 6, 1993, and October 30, 1993, respectively,

petitioner filed Forms 1040 for his taxable years 1987 (1987

return) and 1990 (1990 return), the two years to which the

collection action at issue relates.   As reflected in Form 4340

with respect to each of petitioner’s taxable years 1987 and 1990,

respondent assessed on January 3, 1994, and December 6, 1993,

respectively, the following amounts of tax, additions to tax, and

interest:

                                                          Total
 Year         Tax     Additions to Tax   Interest       Liability
 1987       $3,911        $1,857.73      $3,475.41      $9,244.14
 1990        1,954           529.10         386.15       2,869.25

     Petitioner made certain payments to the Internal Revenue

Service (IRS) that respondent ultimately2 credited to


     2
      On various occasions during 1995 through at least 1998,
petitioner and one or more of respondent’s representatives had
discussions regarding at least certain of his taxable years
discussed herein, and respondent made various corrections,
including so-called reversals, to petitioner’s accounts with
respect to his taxable years 1984, 1985, 1986, and 1987. In
describing petitioner’s accounts with respect to certain of his
                                                   (continued...)
                               - 4 -

petitioner’s accounts with respect to his taxable years 1984,

1985, 1986, and/or 1990.   Included within those payments were the

following payments that respondent collected by levy from peti-

tioner’s wages from his employer KG7 K-Surf Radio for the pay

periods indicated:3




     2
      (...continued)
taxable years, we use the word “ultimately” to refer to the
corrected accounts as reflected in respective Forms 4340 with
respect to petitioner’s taxable years 1984, 1985, and 1987 and
respondent’s statement of petitioner’s account with respect to
his taxable year 1986.
     3
      In addition to respondent’s levy notice which respondent
served on KG7 K-Surf Radio, respondent: (1) Recorded a notice of
Federal tax lien (tax lien) in Orange County, California, in the
amount of $17,292.82 with respect to petitioner’s unpaid liabili-
ties of $7,292.32 and $10,000.50 for his taxable years 1984 and
1985, respectively; (2) sent petitioner a notice of levy, which
respondent served on Ocean Broadcasting Inc., in the amount of
$12,618.19 with respect to petitioner’s unpaid liabilities of
$7,379.82, $4,356.86, and $881.51 for his taxable years 1984,
1985, and 1986, respectively; (3) released respondent’s tax lien
with respect to petitioner’s taxable years 1984 and 1985; and
(4) recorded a notice of tax lien with respect to each of peti-
tioner’s taxable years 1987, 1988, and 1990.

     With respect to the notice of levy that respondent sent
petitioner and served on Ocean Broadcasting Inc., the parties
stipulated: “Attached as Exhibit 11-P is a copy of respondent’s
notice of levy dated January 14, 1992, which was served on Ocean
Broadcasting, Inc. in an attempt to collect respondent’s personal
income tax liability for 1984, 1985 and 1986.” That stipulation
is clearly contrary to the facts disclosed by the record to the
extent that it states that respondent’s notice of levy was served
in an attempt to collect respondent’s, rather than petitioner’s,
unpaid liability for each of certain taxable years, and we shall
disregard it. See Cal-Maine Foods, Inc. v. Commissioner, 93 T.C.
181, 195 (1989). The record establishes, and we have found, that
respondent’s notice of levy was served in an attempt to collect
petitioner’s unpaid liabilities for his taxable years 1984, 1985,
and 1986.
                               - 5 -

 Petitioner’s Pay Period Ended         Amount Collected by Levy
            05/03/91                           $706.14
            05/20/91                            706.14
            06/05/91                            706.14
            06/20/91                            706.14
            07/05/91                            706.14
            07/19/91                            706.14
            08/08/91                            706.14
            08/20/91                            122.47

     As reflected in Form 4340 with respect to each of peti-

tioner’s taxable years 1984 and 1985, respondent ultimately

credited:   (1) Petitioner’s accounts with respect to his taxable

years 1984 and 1985 with petitioner’s payments totaling $1,277.20

and $1,547.36, respectively, consisting of each of the $706.14

payments set forth above that were made by levy from petitioner’s

wages for his pay periods that ended May 3, May 20, June 5, and

June 20, 1991; (2) petitioner’s account with respect to his

taxable year 1985 with petitioner’s payments totaling $1,412.28,

consisting of each of the $706.14 payments set forth above that

were made by levy from petitioner’s wages for his pay periods

that ended July 5 and July 19, 1991; (3) petitioner’s account

with respect to his taxable year 1985 with $54 of petitioner’s

payment of $706.14 set forth above that was made by levy from

petitioner’s wages for his pay period that ended August 8, 1991;4


     4
      Sometime before the trial in this case, respondent con-
ceded, and on brief respondent reaffirms respondent’s concession,
that respondent did not credit to petitioner’s account with
respect to any taxable year $652.14 of the $706.14 that respon-
                                                   (continued...)
                               - 6 -

and (4) petitioner’s account with respect to his taxable year

1985 with petitioner’s payment of $122.47 set forth above that

was made by levy from petitioner’s wages for his pay period that

ended August 20, 1991.

     Also included within the payments that petitioner made to

the IRS during the period March 20, 1996, through March 29, 1998,

were 15 $1,000 payments that petitioner believed respondent

should have credited against his unpaid liability for each of his

taxable years 1987 and 1990.   However, as reflected in Form 4340

with respect to each of petitioner’s taxable years 1984 and 1985

and in respondent’s statement of petitioner’s account with

respect to his taxable year 1986, respondent ultimately credited

petitioner’s 15 $1,000 payments as follows:




     4
      (...continued)
dent collected by levy from petitioner’s wages for his pay period
that ended Aug. 8, 1991, and that respondent should have credited
that $652.14 as of Aug. 29, 1991, against petitioner’s unpaid
liability for his taxable year 1987.
                              - 7 -

  Taxable Year to
   Which Payment        Date as of Which           Amount of
    Was Credited      Payment Was Credited      Payment Credited
        1986                 03/20/96                $1,000
        1985                 04/20/96                 1,000
        1985                 05/19/96                 1,000
        1985                 06/20/96                 1,000
        1985                 07/20/96                 1,000
        1985                 08/20/96                 1,000
        1985                 09/21/96                 1,000
        1985                 10/22/96                 1,000
        1985                 11/20/96                 1,000
        1985                 12/20/96                 1,000
        1985                 01/19/97                 1,000
        1985                 03/04/97                 1,000
        1984                 03/29/97                 1,000
        1984                 06/01/97                 1,000
        1985                 03/29/98                 1,000

     In addition to crediting petitioner’s payments to his

accounts with respect to his taxable years 1984, 1985, 1986,

and/or 1990, respondent ultimately:   (1) Credited petitioner’s

account with respect to each of his taxable years 1984, 1985, and

1987 with certain credits and (2) debited petitioner’s account

with respect to each of his taxable years (a) 1984 and 1985 to

reflect certain refunds to him, (b) 1984, 1985, and 1986 to

reflect the transfer of certain credits from each of those

taxable years to his taxable years 1984, 1985, and/or 1987, and

(c) 1984, 1985, and 1987 to reflect certain corrections of

payments and/or certain reversals of credits.   As reflected in

Form 4340 with respect to each of petitioner’s taxable years 1984

and 1985 and in respondent’s statement of petitioner’s account
                              - 8 -

with respect to his taxable year 1986, on various dates respon-

dent credited and debited petitioner’s account as follows:
                                           - 9 -

                    Credits                           Credits   Corrections of
      Payments      Applied   Credits              Transferred   Payments and    Actual Total
         by       From Other    For                  to Other      Reversals      Payments
                                                             1
Year Petitioner      Years   Interest Refunds          Years       of Credits2   and Credits3
1984 $30,594.34    $4,663.13   $7.98  ($12.91)     ($2,494.51)   ($20,451.27)     $12,306.76
1985  35,033.56     1,184.05     .77  (377.84)      (3,085.93)    (12,126.85)      20,627.76
1986   2,509.00       ---       ---     ---            (663.80)       ---           1,845.20

     1
       Respondent applied the amounts shown under the heading “Credits Transferred to Other
Years” as payments and/or credits to petitioner’s accounts with respect to his taxable
years 1984, 1985, and/or 1987.
     2
       Respondent applied the amounts shown under the heading “Corrections of Payments and
Reversals of Credits” as payments to petitioner’s accounts with respect to his taxable
years 1984 and/or 1985.
     3
       The amounts shown under the heading “Actual Total Payments and Credits” are the
payments and credits that respondent ultimately applied to petitioner’s accounts with
respect to his taxable years 1984, 1985, and 1986, respectively.
                                    - 10 -

     As reflected in Form 4340 with respect to petitioner’s

taxable year 1987, respondent made the following assessments and

credited and debited petitioner’s account as follows:

                                           Assessment,    Payment,    Assessment
                  Explanation of          Other Debits     Credit     Date (23C,
   Date             Transaction             (Reversal)   (Reversal)    RAC 006)
            Adjusted gross income
                      38,849.00
            Taxable income
                      22,013.00
 12-06-93   Return filed and tax           $3,911.00                   01-03-94
              assessed
              89221-338-08708-3 199351
 04-15-88   Extension of time to file
              ext. date 08-15-88
            Late filing penalty                879.98                  01-03-94
              199351
            Failure to pay tax penalty         977.75                  01-03-94
              199351
            Interest assessed 199351         3,475.41                  01-03-94
 08-08-94   Federal tax lien
 05-22-96   Collection statute
              extension to 12-31-08
 06-01-97   Overpaid credit applied                        $270.78
              1040 198412
 06-01-97   Overpaid credit applied                         880.46
              1040 198412
 03-23-98   Interest overpayment                              7.98
              credit
              1040 198412
 06-01-97   Overpaid credit reversed
              1040 198412                                 (270.78)
 06-01-97   Overpaid credit reversed
              1040 198412                                 (880.46)
 06-01-97   Overpaid credit applied                          151.24
              1040 198412
 10-17-98   Overpaid credit applied                         448.28
              1040 199712
 03-12-99   Legal/bankruptcy suit
              pending
 08-21-89   Taxpayer delinquency notice
 01-24-94   Statutory notice of intent
              to levy
 01-03-94   Statutory notice of balance
              due

Balance           $8,636.64

     As reflected in Form 4340 with respect to petitioner’s

taxable year 1990, respondent made the following assessments and
                                    - 11 -

credited petitioner’s account as follows:

                                           Assessment,    Payment,    Assessment
                  Explanation of          Other Debits     Credit     Date (23C,
   Date              Transaction            (Reversal)   (Reversal)    RAC 006)
            Adjusted gross income
                      22,419.00
            Taxable income
                      13,016.00
 10-30-93   Return filed and tax           $1,954.00                   12-06-93
              assessed
              89211-306-95415-3 199347
 10-30-93   Withholding and excess FICA                     $573
 04-15-91   Extension of time to file
              ext. date 08-15-91
 08-11-91   Extension of time to file
              ext. date 10-15-91
 10-30-93   Payment with return                              516
            Late filing penalty               310.73                   12-06-93
              199347
            Failure to pay tax penalty        218.37                   12-06-93
              199347
            Interest assessed                 386.15                   12-06-93
              199347
 08-08-94   Federal tax lien
 05-28-96   Collection statute
              extension to 12-31-08
 03-12-99   Legal/bankruptcy suit
              pending
 12-06-93   Statutory notice of balance
              due
 12-27-93   Statutory notice of intent
              to levy

Balance           $1,780.25

     On January 29, 1999, respondent issued to petitioner a final

notice of intent to levy (notice of intent to levy) with respect

to, inter alia, petitioner’s taxable years 1987 and 1990.5                That

notice stated in pertinent part:

          Your Federal tax is still not paid. We previously
     asked you to pay this, but we still haven’t received
     your payment. This letter is your notice of our intent


     5
      The notice of intent to levy also applied to petitioner’s
taxable year 1988. Petitioner does not raise any issues with
respect to that year in this case.
                                       - 12 -

     to levy under Internal Revenue Code (IRC) Section 6331
     and your right to receive Appeals consideration under
     IRC Section 6330.

          We may file a Notice of Federal Tax Lien at any
     time to protect the government’s interest. A lien is a
     public notice to your creditors that the government has
     a right to your current assets, including any assets
     you acquire after we file the lien.

          If you don’t pay the amount you owe, make alterna-
     tive arrangements to pay, or request Appeals consider-
     ation within 30 days from the date of this letter, we
     may take your property, or rights to property, such as
     real estate, automobiles, business assets, bank ac-
     counts, wages, commissions, and other income. * * *

            * * * The amount you owe is:


     Form    Tax    Unpaid Amount             Additional
    Number Period from Prior Notices      Penalty & Interest AMOUNT YOU OWE
                      [1]                       [2]
    1040 1987               $8636.64               $5082.64       $13719.28
        *         *            *         *            *       *        *
                      [1]                       [2]
    1040 1990               $1780.25               $1078.73        $2858.98

            1
            The amount shown for each of the years 1987 and
     1990 under the heading “Unpaid Amount from Prior No-
     tices” is the same as the amount of the balance shown
     due in Form 4340 with respect to each such year.
          2
            The amount shown for each of the years 1987 and
     1990 under the heading “Additional Penalty & Interest”
     is the additional amount of penalties and/or interest
     for each such year that is not reflected in Form 4340
     with respect to each such year.

     In response to the notice of intent to levy, on February 24,

1999, petitioner filed Form 12153, Request For a Collection Due

Process Hearing (Form 12153), and requested a hearing with the

IRS Appeals Office (Appeals Office).

     Sometime after February 24, 1999, the Appeals officer
                              - 13 -

assigned to petitioner’s case (Appeals officer) scheduled peti-

tioner’s Appeals Office hearing.   The Appeals officer was unable

to attend that scheduled hearing because of the death of the

Appeals officer’s father.   Sometime thereafter, the Appeals

officer sent petitioner a letter rescheduling petitioner’s

Appeals Office hearing on a date and at a time not disclosed by

the record.   Petitioner did not receive that letter until after

the rescheduled date and time for that hearing had passed.

Thereafter, at a time not disclosed by the record, petitioner had

an opportunity via the telephone to discuss with the Appeals

officer and/or the Appeals officer’s supervisor the notice of

intent to levy with respect to petitioner’s taxable years 1987

and 1990.

     During petitioner’s communications with the Appeals Office,

petitioner claimed that he had made an overpayment with respect

to each of his taxable years 1984, 1985, and 1986 and that

respondent should have applied such claimed overpayments against

his unpaid liability for each of his taxable years 1987 and 1990.

Petitioner did not provide the Appeals Office with evidence to

verify any such claimed overpayments.   During his communications

with the Appeals Office, petitioner did not offer any collection

alternatives, nor did he provide the Appeals Office with any

financial statements.

     On May 24, 2000, respondent issued to petitioner a notice of
                               - 14 -

determination with respect to, inter alia, his taxable years 1987

and 1990.   That notice stated in pertinent part as follows:

     Summary of Determination:

          The Notice of Federal Tax Liens were filed on
     8/18/94 and are not subject to the Due Process Proce-
     dures under IRC Section 6320.

          With respect to the Notice of Intent to Levy,
     there has been no response to requests for the comple-
     tion of financial statements in order to determine if a
     possible collection alternative is feasible. We are
     sustaining the District’s decision to take appropriate
     enforcement action.

        *        *       *        *      *        *        *

     Applicable Law and Administrative Procedures

          With the best information available, the require-
     ment [sic] of various applicable law or administrative
     procedures have been met.

          Notice and Demand was made for the above periods
     as verified by review of the transcripts and revenue
     officer history and correspondence.

          IRC Section 6331(d) requires that the IRS notify a
     taxpayer at least 30 days before a Notice of Levy can
     be issued. The 30 day notice was mailed to the tax-
     payer via certified mail and the return receipt was
     signed.

          IRC Section 6330(a) states that no levy may be
     made unless the IRS notifies a taxpayer of the opportu-
     nity for a hearing with the IRS Office of Appeals.
     Letter 1058 “Final Notice” was sent to the taxpayer by
     certified mail. The hearing was requested within the
     appropriate time frames.

          This appeals officer had no prior involvement with
     respect to these liabilities.

     Relevant Issues Presented by the Taxpayer

            The attachment to Form 12153 referred to the
                             - 15 -

     taxpayers’ original audits for 1984 and 1985 and the
     penalties and interest assessed.[1] The taxpayer has
     fully paid those tax years and copies of the lien
     releases were provided to the taxpayer. Those tax
     years do not fall under the Due Process Procedures.
     Any claims for abatement of penalties and interest
     should be made under the appropriate method of filing.

          The lien notices for 1987, 1988, and 1990 were
     filed on 8/18/94 and are not subject to appeal under
     IRC Section 6320.

          The taxpayer has not raised any possible collec-
     tion alternative.

     Balancing Efficient Collection and Intrusiveness

          The revenue officer issued L 1058 after identify-
     ing levy sources. Repeated requests were made for
     financial statements and they were not provided nor has
     the taxpayer raised any possible collection alternative
     for these years. It is his contention that prior years
     are overpaid, yet no evidence has been provided to
     verify that any possible overpayments not previously
     addressed would full pay these tax years. Therefore,
     since the taxpayer has not provided any financial
     statements to determine if there may be a less intru-
     sive method of collection, the District should proceed
     with levy enforcement.
          1
           The record does not contain a copy of the attach-
     ment to petitioner’s Form 12153.

                             OPINION

     Petitioner contends that respondent has not accounted for

all of the payments that he made to the IRS with respect to his

taxable years 1984, 1985, 1986, 1987, and/or 1990.6   According to

petitioner, if respondent had properly accounted for all such



     6
      Although given the opportunity to do so, petitioner did not
file any briefs in this case. Our understanding of petitioner’s
position is based upon his opening statement and his testimony at
the trial in this case.
                               - 16 -

payments, respondent’s records would show that petitioner made

overpayments with respect to his taxable years 1984, 1985, and

1986, which overpayments respondent should have applied against

his liability for each of his taxable years 1987 and 1990, the

two years to which the collection action at issue relates.7

Respondent counters that, with one exception, respondent has

accounted for all of the payments that petitioner made to respon-

dent.    With respect to that one exception, respondent concedes

that respondent did not account for $652.14 of the $706.14

payment made by levy from petitioner’s wages for the pay period

that ended August 8, 1991, and that respondent should have

credited that $652.14 as of August 29, 1991, to petitioner’s

account with respect to his taxable year 1987.   See supra note 4.

     Because the amount of the liability that remains unpaid for

each of petitioner’s taxable years 1987 and 1990 is properly at

issue, we review respondent’s determination de novo.8   Boyd v.

Commissioner, 117 T.C. 127, 131 (2001); Landry v. Commissioner,


     7
      Petitioner acknowledges that even if respondent had applied
certain alleged overpayments against his liability for each of
his taxable years 1987 and 1990, he nonetheless would have an
unpaid liability for each such year, although he does not know
the amount of each such unpaid liability.
     8
      We reject respondent’s position that an abuse-of-discretion
standard applies in the instant case. See Boyd v. Commissioner,
117 T.C. 127, 131 (2001); Landry v. Commissioner, 116 T.C. 60, 62
(2001). In this connection, respondent does not contest that
petitioner received no notice of deficiency for taxable year 1987
or taxable year 1990 and that petitioner otherwise had no oppor-
tunity to dispute the amount of the liability that remains unpaid
for each such year. See sec. 6330(c)(2)(B), I.R.C.
                               - 17 -

116 T.C. 60, 62 (2001).

     The record in this case includes Form 4340 with respect to

each of petitioner’s taxable years 1984, 1985, 1987, and 1990 and

respondent’s statement of petitioner’s account with respect to

his taxable year 1986.    Although as reflected in those forms and

that statement respondent made numerous and various corrections,

including so-called reversals, to petitioner’s accounts with

respect to his taxable years 1984, 1985, 1986, and 1987, we have

been able to reconcile all of the entries therein.   Except for

respondent’s concession regarding petitioner’s taxable year 1987,

see supra note 4, on the record before us, we are unable to find

that respondent has not accounted for all of the payments that

petitioner made to the IRS with respect to his taxable years

1984, 1985, 1986, 1987, and/or 1990.    Nor are we able to find on

the instant record that petitioner made an overpayment with

respect to any of his taxable years 1984, 1985, and 1986 for

which respondent has not accounted and which respondent should

have applied against petitioner’s liability for each of his

taxable years 1987 and 1990.

     Based upon our examination of the entire record before us,

we find that, except for respondent’s concession regarding

petitioner’s taxable year 1987, see supra note 4, petitioner has

not paid the liability for each of his taxable years 1987 and

1990 that respondent is now attempting to collect.
                             - 18 -

     We have considered all of the contentions and arguments that

petitioner advanced at the trial in this case and that are not

discussed herein, and we find them to be without merit and/or

irrelevant.

     To reflect the foregoing and the concession of respondent

with respect to petitioner’s taxable year 1987,



                                   Decision will be entered

                              under Rule 155.9




     9
      The reference to Rule 155 is to Rule 155, Tax Court Rules
of Practice and Procedure.
                                   - 19 -

                                APPENDIX A

             Information Reflected in Form 4340 With
            Respect to Petitioner’s Taxable Year 1984

                                         Assessment,    Payment,    Assessment
                  Explanation of        Other Debits     Credit     Date (23C,
  Date              Transaction           (Reversal)   (Reversal)    RAC 006)
           Adjusted gross income
                     20,567.00
           Taxable income
                     19,462.00
08-15-85   Return filed and tax          $2,658.00                   10-28-85
             assessed
             17211-278-01512-5 198542
08-15-85   Withholding and excess                       $189.00
             FICA
04-15-85   Extension of time to file
             ext. date 08-15-85
           Estimated tax penalty            153.00                   10-28-85
             198542
           Failure to pay tax penalty        86.41                   10-28-85
             198542
           Interest assessed 198542         161.13                   10-28-85
04-28-86   Overpaid credit applied                       216.39
             1040 198512
04-15-86   Overpaid credit applied                     2,869.54
             1040 198512
           Failure to pay tax penalty        61.73                   04-28-86
             198616
           Interest assessed 198616         141.75                   04-28-86
04-28-86   Refund                                        (12.91)
           Additional tax assessed by         0.00                   12-05-88
             examination
             29247-720-10501-8 198847
11-21-88   Legal/bankruptcy suit
             pending
           Late filing penalty 198923     1,215.40                   06-19-89
           Additional tax assessed by     3,608.00                   06-19-89
             examination
             29247-550-70013-9 198923
05-26-89   Legal/bankruptcy suit no
             longer pending
06-19-89   Failure to pay tax penalty       (24.69)
             abated
           Interest assessed 198923       2,493.61                   06-19-89
01-10-90   Federal tax lien
           Additional tax assessed            0.00                   07-02-90
             89254-559-18001-0 199025
07-09-91   Subsequent payment                          2,824.56
08-29-91   Overpaid credit applied                        54.00
             1040 198912
10-16-93   Overpaid credit applied                        87.84
             1040 199212
                                   - 20 -

                                         Assessment,    Payment,    Assessment
                 Explanation of         Other Debits     Credit     Date (23C,
  Date             Transaction            (Reversal)   (Reversal)    RAC 006)
10-16-93   Overpaid credit applied                       277.04
             1040 199212
12-07-93   Subsequent payment                            144.96
10-19-92   Overpaid credit applied                       389.51
             1040 199112
01-08-93   Overpaid credit applied                       105.01
             1040 199112
07-09-91   Subsequent payment                          (2,824.56)
             corrected
03-29-94   Subsequent payment                            157.73
05-02-95   Subsequent payment                              0.00
             miscellaneous payment
05-22-95   Fees and collection costs         14.00
04-20-96   Subsequent payment                          1,000.00
05-19-96   Subsequent payment                          1,000.00
03-20-96   Overpaid credit applied                       663.80
             1040 198612
05-22-96   Collection statute
             extension to 12-31-08
06-20-96   Subsequent payment                          1,000.00
07-20-96   Subsequent payment                          1,000.00
08-20-96   Subsequent payment                          1,000.00
09-21-96   Subsequent payment                          1,000.00
           Failure to pay tax penalty       573.57                   10-14-96
             199640
10-22-96   Subsequent payment                          1,000.00
           Interest assessed                763.69                   11-11-96
             199644
           Failure to pay tax penalty       236.31                   11-11-96
             199644
11-20-96   Subsequent payment                          1,000.00
           Interest assessed              1,000.00                   12-16-96
             199649
12-20-96   Subsequent payment                          1,000.00
           Interest assessed              1,000.00                   02-03-97
             199704
01-19-97   Subsequent payment                          1,000.00
           Interest assessed              1,000.00                  02-10-97
             199705
03-04-97   Subsequent payment                          1,000.00
           Interest assessed              1,000.00                   03-31-97
             199712
03-29-97   Subsequent payment                          1,000.00
           Interest assessed              1,000.00                   04-21-97
             199715
05-04-97   Subsequent payment                            335.29
           Interest assessed                664.71                   05-26-97
             199720
05-04-97   Overpayment credit                           (335.29)
             transferred
             1040 198512
                                   - 21 -

                                         Assessment,    Payment,    Assessment
                 Explanation of         Other Debits     Credit     Date (23C,
  Date             Transaction            (Reversal)   (Reversal)    RAC 006)
06-01-97   Subsequent payment                          1,000.00
06-01-97   Overpayment credit                           (729.22)
             transferred
             1040 198512
06-01-97   Overpayment credit                           (270.78)
             transferred
             1040 198712
06-20-97   Federal tax lien released
11-17-90   Subsequent payment                            706.14
12-05-90   Subsequent payment                            706.14
12-20-90   Subsequent payment                            706.14
01-07-91   Subsequent payment                            706.14
01-30-91   Subsequent payment                            706.14
02-04-91   Subsequent payment                            706.14
02-22-91   Subsequent payment                            706.14
03-03-91   Subsequent payment                            706.14
03-26-91   Subsequent payment                            706.14
04-05-91   Subsequent payment                            706.14
04-22-91   Subsequent payment                            706.14
03-23-98   Failure to pay tax penalty       (478.63)
             abated
03-23-98   Interest abated               (4,902.19)
07-09-91   Subsequent payment                          1,277.20
08-01-91   Subsequent payment                          1,412.28
09-03-91   Subsequent payment                            122.47
04-06-98   Interest abated                  (119.04)
           Failure to pay tax penalty          0.00                  04-20-98
             199814
           Restricted interest                 0.00                  04-20-98
             assessed 199814
           Additional tax assessed             0.00                  04-20-98
             89254-489-15000-8 199814
07-09-91   Subsequent payment                          (1,547.36)
             corrected
07-09-91   Subsequent payment                           1,547.36
08-01-91   Subsequent payment                          (1,412.28)
             corrected
09-03-91   Subsequent payment                           (122.47)
             corrected
12-07-93   Subsequent payment                           (144.96)
             corrected
03-29-94   Subsequent payment                           (157.73)
             corrected
04-20-96   Subsequent payment                          (1,000.00)
             corrected
05-19-96   Subsequent payment                          (1,000.00)
             corrected
06-20-96   Subsequent payment                          (1,000.00)
             corrected
07-20-96   Subsequent payment                          (1,000.00)
             corrected
                                   - 22 -

                                         Assessment,    Payment,    Assessment
                 Explanation of         Other Debits     Credit     Date (23C,
  Date             Transaction            (Reversal)   (Reversal)    RAC 006)
08-20-96   Subsequent payment                          (1,000.00)
             corrected
09-21-96   Subsequent payment                          (1,000.00)
             corrected
10-22-96   Subsequent payment                          (1,000.00)
             corrected
11-20-96   Subsequent payment                          (1,000.00)
             corrected
12-20-96   Subsequent payment                          (1,000.00)
             corrected
01-19-97   Subsequent payment                          (1,000.00)
             corrected
03–04-97   Subsequent payment                          (1,000.00)
             corrected
05–04-97   Subsequent payment                           (664.71)
             corrected
05-04-97   Subsequent payment                            664.71
08-29-91   Overpaid credit reversed                      (54.00)
             1040 198512
10-19-92   Overpaid credit reversed                     (389.51)
             1040 198512
01-08-93   Overpaid credit reversed                     (105.01)
             1040 198512
10-16-93   Overpaid credit reversed                     (277.04)
             1040 198512
10-16-93   Overpaid credit reversed                      (87.84)
             1040 198512
03-20-96   Overpaid credit reversed                     (663.80)
             1040 198512
06-01-97   Overpayment credit                           (119.54)
             transferred
             1040 198512
06-01-97   Overpayment credit                           (880.46)
             transferred
             1040 198712
03-23-98   Interest due taxpayer                           7.98
03-23-98   Overpayment interest                           (7.98)
             transferred
             1040 198712
03-29-97   Subsequent payment                          (1,000.00)
             corrected
06-01-97   Subsequent payment                            270.78
06-01-97   Subsequent payment                            880.46
           Additional tax assessed            0.00                   10-05-98
             29254-657-18007-8 199838
06-01-97   Overpayment credit                           (151.24)
             transferred
             1040 198712
10-28-85   Statutory notice of
             balance due
12-02-85   Notice of balance due
                                      - 23 -

                                            Assessment,    Payment,    Assessment
                  Explanation of           Other Debits     Credit     Date (23C,
   Date             Transaction              (Reversal)   (Reversal)    RAC 006)
 02-17-86   Statutory   notice of intent
              to levy
 06-19-89   Statutory   notice of
              balance   due
 07-24-89   Notice of   balance due
 11-12-90   Statutory   notice of intent
              to levy
 05-11-98   Statutory   notice of
              balance   due
 06-01-98   Statutory   notice of intent
              to levy


Balance            $0.00
                                   - 24 -

                                APPENDIX B

             Information Reflected in Form 4340 With
            Respect to Petitioner’s Taxable Year 1985

                                          Assessment,    Payment,    Assessment
                  Explanation of         Other Debits     Credit     Date (23C,
  Date              Transaction            (Reversal)   (Reversal)    RAC 006)
           Adjusted gross income
                     20,059.00
           Taxable income
                     16,354.00
04-15-86   Return filed and tax           $1,817.00                   04-28-86
             assessed
             31211-089-63604-6 198616
04-15-86   Withholding and excess FICA                  $5,280.00
04-15-86   Overpayment credit
             transferred                                (3,085.93)
             1040 198412
04-28-86   Interest due taxpayer                             0.77
04-28-86   Refund
                                                         (377.84)
           Additional tax assessed by           0.00                  12-05-88
             examination
             29247-720-10502-8 198847
11-21-88   Legal/bankruptcy suit
             pending
           Additional tax assessed by       7,283.00                  06-19-89
             examination
             29247-550-70014-9 198923
05-26-89   Legal/bankruptcy suit no
             longer pending
           Interest assessed 198923         2,717.50                  06-19-89
01-10-90   Federal tax lien
11-17-90   Subsequent payment                              706.14
           Additional tax assessed              0.00                  12-24-90
             89254-739-00011-0 199050
12-05-90   Subsequent payment                              706.14
12-20-90   Subsequent payment                              706.14
01-07-91   Subsequent payment                              706.14
01-30-91   Subsequent payment                              706.14
02-04-91   Subsequent payment                              706.14
02-22-91   Subsequent payment                              706.14
03-03-91   Subsequent payment                              706.14
03-26-91   Subsequent payment                              706.14
04-05-91   Subsequent payment                              706.14
04-22-91   Subsequent payment                              706.14
08-01-91   Subsequent payment                            1,412.28
09-03-91   Subsequent payment                              122.47
07-09-91   Subsequent payment                            2,824.56
           Interest assessed                1,409.98                  03-07-94
             199408
           Failure to pay tax penalty         716.37                  03-07-94
             199408
                                   - 25 -

                                         Assessment,    Payment,    Assessment
                  Explanation of        Other Debits     Credit     Date (23C,
  Date              Transaction           (Reversal)   (Reversal)    RAC 006)
05-22-96   Collection statute
             extension to 12-31-08
05-04-97   Overpaid credit applied                        335.29
             1040 198412
           Failure to pay tax penalty           0.02                 05-26-97
             199720
           Interest assessed                  335.27                 05-26-97
             199720
06-01-97   Overpaid credit applied                        729.22
             1040 198412
           Interest assessed                  729.22                 06-23-97
             199724
06-20-97   Federal tax lien released
11-17-90   Subsequent payment
             corrected                                  (706.14)
12-05-90   Subsequent payment
             corrected                                  (706.14)
12-20-90   Subsequent payment
             corrected                                  (706.14)
01-07-91   Subsequent payment
             corrected                                  (706.14)
01-30-91   Subsequent payment
             corrected                                  (706.14)
02-04-91   Subsequent payment
             corrected                                  (706.14)
02-22-91   Subsequent payment
             corrected                                  (706.14)
03-03-91   Subsequent payment
             corrected                                  (706.14)
03-26-91   Subsequent payment
             corrected                                  (706.14)
04-05-91   Subsequent payment
             corrected                                  (706.14)
04-22-91   Subsequent payment
             corrected                                  (706.14)
07-09-91   Subsequent payment
             corrected                                 (2,824.56)
08-01-91   Subsequent payment
             corrected                                 (1,412.28)
09-03-91   Subsequent payment
             corrected                                  (122.47)
           Failure to pay tax penalty       1,104.36                 03-23-98
             199810
           Interest assessed                9,816.51                 03-23-98
             199810
07-09-91   Subsequent payment                           1,547.36
08-01-91   Subsequent payment                           1,412.28
08-29-91   Subsequent payment                              54.00
09-03-91   Subsequent payment                             122.47
10-19-92   Subsequent payment                             389.51
01-08-93   Subsequent payment                             105.01
10-16-93   Subsequent payment                              87.84
                                    - 26 -

                                           Assessment,    Payment,    Assessment
                   Explanation of         Other Debits     Credit     Date (23C,
   Date              Transaction            (Reversal)   (Reversal)    RAC 006)
 10-16-93   Subsequent payment                               277.04
 12-07-93   Subsequent payment                               144.96
 03-29-94   Subsequent payment                               157.73
 03-20-96   Subsequent payment                               663.80
 04-20-96   Subsequent payment                             1,000.00
 05-19-96   Subsequent payment                             1,000.00
 06-20-96   Subsequent payment                             1,000.00
 07-20-96   Subsequent payment                             1,000.00
 08-20-96   Subsequent payment                             1,000.00
 09-21-96   Subsequent payment                             1,000.00
 10-22-96   Subsequent payment                             1,000.00
 11-20-96   Subsequent payment                             1,000.00
 12-20-96   Subsequent payment                             1,000.00
 01-19-97   Subsequent payment                             1,000.00
 03–04-97   Subsequent payment                             1,000.00
 05–04-97   Subsequent payment                               664.71
 03-29-98   Subsequent payment                             1,000.00
 04-20-98   Failure to pay tax penalty       (406.60)
              abated
 04-20-98   Interest abated                (4,894.10)
 03-23-89   Overpaid credit applied                         119.54
              1040 198412
 04-20-98   Interest abated                    (0.77)
 06-19-89   Statutory notice of balance
              due
 07-24-89   Notice of balance due
 03-23-98   Statutory notice of balance
              due


Balance            $0.00
                                - 27 -

                             APPENDIX C

Information Reflected in Respondent’s Statement of Petitioner’s
         Account With Respect to His Taxable Year 1986
Transaction
   Date         Amount                  Transaction Explanation
 10-11-88      $522.00    Tax return filed - amount of tax assessed
 04-15-87       552.00-   Credit for withholding and excess FICA taxes
 04-15-87         0.00    Request for extension of time to file approved -
                             extended to 08-15-87
 09-16-91       143.99    Negligence penalty charge
 09-16-91       100.00    Penalty charge for late filing
 09-16-91       334.00    Additional tax assessed after return examination
 09-16-91       255.65    Interest charge
 08-29-94        10.00    Collection charge-lien fee
 02-18-96       957.00-   Payment received
 03-11-96        29.86    Interest charge
 03-11-96        83.50    Penalty charge for late payment of tax
 03-20-96     1,000.00-   Payment received
 04-15-96       336.20    Interest charge
 03-20-96       663.80    Credit transferred to another period or account
