                                               LARRY E. TUCKER, PETITIONER v. COMMISSIONER                                    OF
                                                       INTERNAL REVENUE, RESPONDENT
                                                        Docket No. 3165–06L.                       Filed July 26, 2010.

                                                 P filed income tax returns for 2000, 2001, and 2002 that
                                               reported tax due; but he did not pay the tax. The Internal
                                               Revenue Service (IRS) assessed the tax and issued to P a
                                               notice of the filing of a tax lien (NFTL). P timely requested
                                               a collection due process (CDP) hearing, which is to be ‘‘con-
                                               ducted by an officer or employee’’ of the IRS Office of Appeals,
                                               I.R.C. sec. 6320(b)(3), and which is to conclude with a ‘‘deter-
                                               mination by an appeals officer’’, I.R.C. sec. 6330(c)(3). P’s CDP
                                               hearing was conducted by a settlement officer in the IRS
                                               Office of Appeals, and after the CDP hearing a team manager
                                               in that office issued to P a notice of determination upholding
                                               the NFTL. P filed with the Tax Court a timely appeal pursu-
                                               ant to I.R.C. sec. 6330(d)(1). After initial proceedings, this
                                               Court ordered a remand to the Office of Appeals for further
                                               consideration. A second CDP hearing was conducted by
                                               another settlement officer, and the team manager issued a
                                               supplemental notice of determination again upholding the
                                               NFTL. The team manager and both settlement officers had
                                               been hired by the Commissioner pursuant to I.R.C. sec.
                                               7804(a) and were not appointed by the President or the Sec-
                                               retary of the Treasury. P moved for a second remand so that
                                               a CDP hearing could be conducted by, and a notice of deter-
                                               mination issued by, an officer appointed by the President or
                                               the Secretary of the Treasury, in compliance with the
                                               Appointments Clause. See U.S. Const., art. II, sec. 2, cl. 2.
                                               Held: An ‘‘officer or employee’’ or an ‘‘appeals officer’’ under
                                               I.R.C. sec. 6320 or 6330 is not an ‘‘inferior Officer of the
                                               United States’’ for purposes of the Appointments Clause. P’s
                                               motion to remand will be denied.

                                           Carlton M. Smith, for petitioner.*
                                           Matthew D. Lucey, for respondent.

                                        *The following students assisted Professor Smith: Tanyika Brime, Anya Ferris, Lisa Gordon,
                                      Marisa Harris, Samir Ismayilov, Shay Moyal, Cheryl Scher, Elisa Vega, Scott Weese, and Jer-
                                      emy Zenilman.
                                        Briefs amicus curiae were filed by A. Lavar Taylor as counsel for the Center for the Fair Ad-
                                      ministration of Taxes. The following students assisted Professor Taylor: Joe Bosik, Habbib
                                      Hanna, and Kelly Regan.


                                      114




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                                                                                         CONTENTS
                                      Background ............................................................................................. 117
                                      Discussion ................................................................................................ 119
                                           I.    The Appointments Clause ............................................................               120
                                                A. The purposes of the Appointments Clause .............................                            120
                                                B. The distinctions in the Appointments Clause: ‘‘Officers’’,
                                                      ‘‘inferior Officers’’, and non-officer employees ....................                         122
                                                  1. ‘‘Principal’’ officers vs. ‘‘inferior’’ officers .............................                 122
                                                  2. ‘‘Officers’’ vs. non-officer employees .....................................                   123
                                                C. Modes of appointment under the Appointments Clause .......                                       125
                                                D. Appointment of revenue personnel in the late 18th century                                        126
                                                  1. The Department of the Treasury .........................................                       127
                                                  2. External revenue collection ..................................................                 127
                                                  3. Internal revenue collection ...................................................                129
                                                E. Subsequent appointment of internal revenue personnel ......                                      133
                                           II. The Internal Revenue Service Office of Appeals .......................                               134
                                              A. The legal basis for the Office of Appeals ................................                         134
                                              B. A brief history of the Office of Appeals ..................................                        135
                                              C. ‘‘Appeals Officers’’ in the Office of Appeals ............................                         136
                                                1. The Pre-CDP Role of the ‘‘Appeals Officer’’ ........................                             136
                                                2. ‘‘Collection Due Process’’ procedures added to the Code
                                                      in 1998 ...............................................................................       137
                                                3. Post-CDP hearing procedures ..............................................                       140
                                                4. The tax administration context of the CDP ‘‘officer or
                                                      employee’’ ...........................................................................        149
                                                5. The administrative law context of the CDP ‘‘officer or
                                                      employee’’ ...........................................................................        151
                                           III.    The status of the CDP ‘‘officer or employee’’ and ‘‘appeals
                                                     officer’’ under the Appointments Clause ..............................                         152
                                                A. Whether the position is ‘‘established by Law’’ .......................                           152
                                                  1. Creation by statute ...............................................................            152
                                                  2. Creation by regulation ..........................................................              156
                                                B. Whether the CDP function could constitute an ‘‘office’’ ........                                 159
                                                  1. Whether the CDP provisions created a ‘‘continuing’’
                                                         position ...............................................................................   160
                                                  2. Whether the CDP hearing officer has ‘‘significant
                                                         authority’’ ...........................................................................    160
                                      Conclusion ............................................................................................... 165


                                                                                           OPINION

                                         GUSTAFSON, Judge: This case is an appeal, pursuant to sec-
                                      tion 6330(d)(1), 1 by which petitioner Larry E. Tucker seeks
                                      this Court’s review of a determination by the Office of
                                        1 Unless otherwise indicated, all section references are to the Internal Revenue Code (‘‘Code’’,

                                      26 U.S.C.).




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                                      Appeals of the Internal Revenue Service (IRS) to sustain the
                                      filing of a notice of lien in order to collect Mr. Tucker’s
                                      unpaid income taxes for the years 2000, 2001, and 2002.
                                      That determination was made after the Office of Appeals
                                      conducted a collection due process (CDP) hearing pursuant to
                                      section 6330(c) and a supplemental CDP hearing pursuant to
                                      a remand of this Court. The determination was reflected in
                                      an initial ‘‘Notice of Determination Concerning Collection
                                      Action(s) Under Section 6320 and/or 6330’’ and in a ‘‘Supple-
                                      mental Notice of Determination Concerning Collection
                                      Action(s) Under Section 6320 and/or 6330’’. We will eventu-
                                      ally review the merits of that collection determination. 2
                                         Currently before us, however, is Mr. Tucker’s motion for
                                      remand. That motion presents a question not about Mr.
                                      Tucker’s tax liabilities nor about the collection decisions of
                                      the Office of Appeals in this case but about the constitutional
                                      validity of that Office’s staffing of CDP proceedings that it
                                      conducts pursuant to section 6330(c). The settlement officers
                                      who conducted Mr. Tucker’s CDP hearings and the team man-
                                      ager who signed and issued the notices of determination
                                      were all hired by the Commissioner of Internal Revenue
                                      pursuant to section 7804(a) and were not appointed by the
                                      President or the Secretary of the Treasury. Mr. Tucker con-
                                      tends, however, that the ‘‘appeals officer’’ in section 6330(c)
                                      is an ‘‘Officer of the United States’’ who, according to the
                                      Appointments Clause of Article II, Section 2, of the U.S. Con-
                                      stitution, must be appointed either by the President or by
                                      one of ‘‘the Heads of Departments’’ (in this case, the Sec-
                                      retary of the Treasury). Because the settlement officers who
                                      handled Mr. Tucker’s CDP proceeding were not so appointed,
                                      Mr. Tucker contends that he has not yet been given the CDP
                                      hearing that Congress mandated, and he asks us to remand
                                      the matter for a valid hearing before a duly appointed officer.
                                         We will deny Mr. Tucker’s motion to remand. We hold that
                                      the ‘‘officer or employee’’ in section 6320(b)(3) or 6330(b)(3),
                                      also referred to as an ‘‘appeals officer’’ in section 6330(c)(1)
                                      and (3), is not an ‘‘Officer of the United States’’ subject to the
                                        2 In addition to the motion to remand that we address in this Opinion, there are also pending

                                      before us both respondent’s motion for summary judgment asking the Court to sustain the sup-
                                      plemental notice of determination and Mr. Tucker’s cross-motion for summary judgment asking
                                      that we hold that the supplemental notice reflected an abuse of discretion by the Office of Ap-
                                      peals. Those cross-motions address the merits of the CDP determination, and we do not decide
                                      them in this Opinion.




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                                      Appointments Clause, for two reasons: First, there is no
                                      office ‘‘established by Law’’ to which the clause applies; and
                                      second, the CDP hearing officer does not exercise the ‘‘signifi-
                                      cant authority’’ that defines an ‘‘office’’ according to the rel-
                                      evant case law.

                                                                               Background
                                         The facts pertinent to Mr. Tucker’s motion to remand can
                                      be stated very succinctly: He properly requested a CDP
                                      hearing pursuant to section 6320, and the employees of the
                                      Office of Appeals who conducted his CDP hearings and issued
                                      his notices of determination were not appointed by the Presi-
                                      dent or the Secretary of the Treasury.
                                         Those facts can be elaborated in somewhat more detail
                                      without any dispute, on the basis of the pleadings, the par-
                                      ties’ motion papers, and the supporting exhibits attached
                                      thereto.
                                      Tax years 2000, 2001, and 2002
                                        Mr. Tucker failed to timely file tax returns for 2000, 2001,
                                      and 2002. In June 2003 he filed untimely Forms 1040, ‘‘U.S.
                                      Individual Income Tax Return’’, for those years, but he failed
                                      to pay any of the income tax liability shown on those returns.
                                      The IRS assessed the income tax liabilities that Mr. Tucker
                                      had self-reported but not paid. Almost a year later, on May
                                      8, 2004, the IRS sent to Mr. Tucker a ‘‘Final Notice—Notice
                                      of Intent to Levy and Notice of Your Right to a Hearing’’,
                                      pursuant to sections 6330(a)(1) and 6331(d)(1), advising him
                                      of the IRS’s intent to levy upon his property. Mr. Tucker did
                                      not timely request a hearing under section 6330 with respect
                                      to that notice. On July 22, 2004, the IRS sent to Mr. Tucker
                                      a ‘‘Notice of Federal Tax Lien Filing and Your Right to a
                                      Hearing’’, pursuant to section 6320(a)(1), advising him that
                                      the IRS had filed a notice of tax lien against him. Both
                                      notices reflected the income tax liabilities for 2000, 2001, and
                                      2002.
                                      CDP hearing
                                        In response to the lien notice (but not the earlier notice of
                                      levy), Mr. Tucker submitted to the IRS on August 11, 2004,
                                      a Form 12153, ‘‘Request for a Collection Due Process




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                                      Hearing’’. The CDP hearing was held as a telephone con-
                                      ference on May 31, 2005, between an IRS settlement officer
                                      and Mr. Tucker and his counsel; and subsequently, numerous
                                      letters were exchanged between the settlement officer and
                                      Mr. Tucker’s counsel.
                                      Mr. Tucker’s OIC
                                        On July 25, 2005, Mr. Tucker’s counsel sent to the settle-
                                      ment officer a Form 656, ‘‘Offer in Compromise’’ (OIC), that
                                      proposed to settle Mr. Tucker’s income tax liabilities for
                                      1999, 2000, 2001, 2002, and 2003 for $36,772 payable in
                                      monthly payments of $317 over 116 months. In a letter dated
                                      November 18, 2005, the settlement officer rejected the OIC.
                                      The notice of determination, and the commencement of this
                                      case
                                        On January 9, 2006, a team manager in the Office of
                                      Appeals issued to Mr. Tucker a ‘‘Notice of Determination
                                      Concerning Collection Action(s) under Section 6320 and/or
                                      6330’’, which determined to uphold the filing of a tax lien as
                                      to Mr. Tucker’s income tax liabilities for 2000, 2001, and
                                      2002. In response, Mr. Tucker timely filed a petition with
                                      this Court.
                                      Previous Tax Court proceedings, remand to the Office of
                                      Appeals, and supplemental notice of determination
                                         After filing his petition, Mr. Tucker filed a motion for sum-
                                      mary judgment on June 9, 2006. Respondent opposed that
                                      motion and filed a motion for remand on July 17, 2006. By
                                      our order of July 27, 2006, we denied Mr. Tucker’s motion for
                                      summary judgment and granted respondent’s motion to
                                      remand the case to the IRS’s Office of Appeals for further
                                      consideration of Mr. Tucker’s July 2005 OIC and for issuance
                                      of a supplemental notice of determination no later than
                                      October 16, 2006.
                                         The Office of Appeals then assigned a settlement officer
                                      (i.e., a different settlement officer from the one who had con-
                                      ducted Mr. Tucker’s initial CDP hearing) to conduct a supple-
                                      mental CDP hearing and to reconsider Mr. Tucker’s July 2005
                                      OIC. The supplemental CDP hearing was held as a telephone
                                      conference on September 11, 2006, between the settlement




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                                      officer and Mr. Tucker’s counsel. On September 12, 2006, the
                                      same team manager who had issued the first notice of deter-
                                      mination issued a ‘‘Supplemental Notice of Determination
                                      Concerning Collection Action(s) Under Section 6320 and/or
                                      6330’’, which determined to reject Mr. Tucker’s July 2005 OIC
                                      and to uphold the filing of a tax lien as to Mr. Tucker’s
                                      income tax liabilities for 2000, 2001, and 2002.
                                      The hiring of the settlement officers and team manager
                                        Respondent concedes that, to date, no appeals officer,
                                      settlement officer, or team manager in the Office of Appeals
                                      has been appointed by the President, with or without the
                                      advice and consent of the Senate, or by the Secretary of the
                                      Treasury. Instead, the Office of Appeals personnel who were
                                      involved in Mr. Tucker’s case were all hired by the Commis-
                                      sioner pursuant to section 7804(a).
                                      Mr. Tucker’s motion to remand
                                         In response to the supplemental notice of determination,
                                      on November 21, 2006, Mr. Tucker filed an amendment to
                                      petition with this Court in order to appeal the supplemental
                                      notice of determination. On November 29, 2007, respondent
                                      filed a motion for summary judgment asking the Court to
                                      sustain the supplemental notice of determination. Mr. Tucker
                                      filed a cross-motion for summary judgment on February 27,
                                      2008, and filed a motion for remand on September 2, 2008.
                                      We reserve the issues raised by the parties’ cross-motions for
                                      summary judgment, and we now address Mr. Tucker’s
                                      motion for remand.

                                                                                Discussion
                                        To consider the applicability of the Appointments Clause to
                                      the ‘‘officer or employee’’ under sections 6320(b)(3) and
                                      6330(b)(3), we first analyze the origin and purposes of the
                                      Appointments Clause, then describe generally the Office of
                                      Appeals and its CDP function, and then apply Appointments
                                      Clause analysis to the role of the CDP ‘‘officer or employee’’.




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                                      I. The Appointments Clause
                                           A. The purposes of the Appointments Clause
                                         The framers of the United States Constitution divided the
                                      power of the Federal Government among three branches—
                                      legislative, executive, and judicial—as a safeguard against
                                      tyranny. The former British colonies had experienced (in the
                                      words of the Declaration of Independence) ‘‘a long train of
                                      abuses and usurpations’’ by the British monarch, including
                                      the abuse that ‘‘He has erected a multitude of New Offices,
                                      and sent hither swarms of Officers to harass our people and
                                      eat out their substance.’’ The framers guarded against this
                                      particular instance of tyranny—i.e., the power both to erect
                                      offices and to send out the officers—in the so-called Appoint-
                                      ments Clause in Article II, Section 2, of the Constitution,
                                      which provides for the appointment of ‘‘Officers of the United
                                      States’’:
                                      [The President] shall nominate, and by and with the Advice and Consent
                                      of the Senate, shall appoint Ambassadors, other public Ministers and Con-
                                      suls, Judges of the supreme Court, and all other Officers of the United
                                      States, whose Appointments are not herein otherwise provided for, and
                                      which shall be established by Law: but the Congress may by Law vest the
                                      Appointment of such inferior Officers, as they think proper, in the Presi-
                                      dent alone, in the Courts of Law, or in the Heads of Departments.

                                      The Constitution itself provided explicitly for the appoint-
                                      ment of very few Federal officials, and it left to future polit-
                                      ical process the creation of the great majority of ‘‘Officers of
                                      the United States’’ in the executive and the judiciary. It pro-
                                      vided that their offices would be ‘‘established’’ by the Con-
                                      gress but ‘‘appoint[ed]’’ by persons outside the Congress.
                                         The Appointments Clause has four related but distinct
                                      purposes. First, as we have already noted, the clause is a
                                      safeguard against Congress’s taking to itself the power to
                                      create and fill governmental offices—a reflection of the sepa-
                                      ration-of-powers framework of the U.S. Constitution. See
                                      Freytag v. Commissioner, 501 U.S. 868, 878 (1991); The Fed-
                                      eralist No. 47 (James Madison), No. 77 (Alexander Ham-
                                      ilton).
                                         Second, the Appointments Clause protects the power of the
                                      executive by ‘‘preventing the diffusion of the appointment
                                      power’’, that is, by ‘‘forbid[ding] Congress to grant the




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                                      appointment power to inappropriate members of the Execu-
                                      tive Branch’’. Freytag v. Commissioner, supra at 878, 880; see
                                      also Weiss v. United States, 510 U.S. 163, 188 n.3 (1994)
                                      (Souter, J., concurring) (‘‘if Congress, with the President’s
                                      approval, authorizes a lower level Executive Branch official
                                      to appoint a principal officer, it again has adopted a more dif-
                                      fuse and less accountable mode of appointment than the Con-
                                      stitution requires’’). When Congress establishes an ‘‘inferior
                                      Officer’’ in the Executive Branch, it can vest the appointment
                                      power for that officer no further from the President than the
                                      Head of a Department whom the President himself has
                                      appointed. There is, so to speak, only one degree of separa-
                                      tion between any duly appointed officer and the President,
                                      thus maintaining the locus of executive power in the Presi-
                                      dent himself.
                                         Third, the Appointments Clause has a closely related
                                      democratic purpose: ‘‘by limiting the appointment power’’ to
                                      the President and his own immediate and principal
                                      appointees, 3 the Framers sought to ‘‘ensure that those who
                                      wielded it were accountable to political force and the will of
                                      the people.’’ Freytag v. Commissioner, supra at 884. 4 James
                                      Madison argued in The Federalist No. 39 that, because of the
                                      Appointments Clause, the ‘‘officers of the Union, will * * *
                                      be the choice, though a remote choice, of the people them-
                                      selves’’.
                                         Fourth:
                                      This disposition was also designed to assure a higher quality of appoint-
                                      ments: The Framers anticipated that the President would be less vulner-
                                      able to interest-group pressure and personal favoritism than would a
                                      collective body. ‘‘The sole and undivided responsibility of one man will
                                      naturally beget a livelier sense of duty, and a more exact regard to reputa-
                                      tion.’’

                                         3 The Constitutional Convention did not accept a proposal by James Madison that ‘‘ ‘Superior

                                      Officers below Heads of Departments ought in some cases to have the appointment of the lesser
                                      offices.’ ’’ Freytag v. Commissioner, 501 U.S. 868, 884 (1991) (quoting 2 Records of the Federal
                                      Convention of 1787, at 627–628 (M. Farrand ed. 1966)). Non-officer employees may be hired by
                                      ‘‘Superior Officers below Heads of Departments’’ (e.g., by the Commissioner of Internal Rev-
                                      enue), but under the Appointments Clause as promulgated by the Convention and ratified by
                                      the States, ‘‘Officers of the United States’’ may not be so hired.
                                         4 See also Edmond v. United States, 520 U.S. 651, 663 (1997) (the Appointments Clause was

                                      ‘‘designed to preserve political accountability relative to important Government assignments’’);
                                      Freytag v. Commissioner, 501 U.S. at 907 (Scalia, J., concurring) (‘‘the heads of departments
                                      * * * possess a reputational stake in the quality of the individuals they appoint; and * * * they
                                      are directly answerable to the President, who is responsible to his constituency for their appoint-
                                      ments and has the motive and means to assure faithful actions by his direct lieutenants’’).




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                                      Edmond v. United States, 520 U.S. 651, 659 (1997) (quoting
                                      The Federalist No. 76, at 387 (Alexander Hamilton, M. Beloff
                                      Ed. 1987)).
                                           B. The distinctions in the Appointments Clause: ‘‘Officers’’,
                                              ‘‘inferior Officers’’, and non-officer employees
                                           1. ‘‘Principal’’ officers vs. ‘‘inferior’’ officers
                                         The rules of the Appointments Clause apply to ‘‘all other
                                      Officers of the United States’’ (emphasis added), i.e., to offi-
                                      cers other than those whose appointment is provided else-
                                      where in the Constitution. As a result, ‘‘all persons who can
                                      be said to hold an office * * * were intended to be included
                                      within one or the other of these modes of appointment’’.
                                      United States v. Germaine, 99 U.S. 508, 510 (1879) (emphasis
                                      added). As a general rule, then, all ‘‘officers’’ must be nomi-
                                      nated by the President and confirmed by the Senate.
                                         The Appointments Clause makes an explicit distinction of,
                                      and includes an exception for, ‘‘inferior Officers’’. The case
                                      law applying this exception distinguishes these ‘‘inferior offi-
                                      cers’’ from ‘‘principal officers’’. The term ‘‘principal officer’’ is
                                      not in the Appointments Clause but is borrowed from the
                                      immediately preceding clause (i.e., U.S. Const. art. II, sec. 2,
                                      cl. 1), which provides that ‘‘The President * * * may require
                                      the Opinion in writing, of the principal Officer in each of the
                                      executive Departments, upon any Subject relating to the
                                      Duties of their respective Offices’’. The Constitution thus con-
                                      ceives of ‘‘principal officers’’, who must in every case be nomi-
                                      nated by the President and confirmed by the Senate, and
                                      ‘‘inferior Officers’’, for whom an exception is allowed. In the
                                      case of these inferior officers, ‘‘Congress may by Law vest’’
                                      their appointment, ‘‘as they [in Congress] think proper, in
                                      the President alone, in the Courts of Law, or in the Heads
                                      of Departments.’’ Id. cl. 2 (emphasis added).
                                         ‘‘The line between ‘inferior’ and ‘principal’ officers is one
                                      that is far from clear, and the Framers provided little guid-
                                      ance into where it should be drawn.’’ Morrison v. Olson, 487
                                      U.S. 654, 671 (1988). But in this case Mr. Tucker contends
                                      only that appeals officers are inferior officers, not that they
                                      are principal officers, so that the principal-inferior distinction
                                      is not at issue.




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                                           2. ‘‘Officers’’ vs. non-officer employees
                                         A distinction implicit in the Appointments Clause is
                                      between ‘‘Officers’’, to whom the clause applies, and those
                                      employees who are not officers, to whom it does not apply.
                                      ‘‘The line between ‘mere’ employees and inferior officers is
                                      anything but bright’’, Landry v. FDIC, 204 F.3d 1125, 1132
                                      (D.C. Cir. 2000), 5 but it is the line that must be drawn in
                                      this case. The Supreme Court has broadly defined the term
                                      ‘‘Officer of the United States’’ as ‘‘any appointee exercising
                                      significant authority pursuant to the laws of the United
                                      States’’, Buckley v. Valeo, 424 U.S. 1, 126 (1976), and ‘‘all
                                      appointed officials exercising responsibility under the public
                                      laws of the Nation’’, id. at 131. The Court has explained,
                                      however, that the term ‘‘does not include all employees of the
                                      United States * * *. Employees are lesser functionaries
                                      subordinate to officers of the United States’’. Id. at 126
                                      n.162. 6
                                         Mr. Tucker does not dispute the existence of this sub-
                                      officer category of ‘‘lesser functionaries’’; he does not argue
                                      that all Federal employees are officers who must be
                                      appointed. However, lest it be thought that the lack of
                                      explicit warrant in the Constitution suggests that non-officer
                                      employees cannot properly exist in the Executive Branch, or
                                      that they cannot be numerous, it should be noted that the
                                         5 See Jerry L. Mashaw, ‘‘Recovering American Administrative Law: Federalist Foundations,

                                      1787–1801’’, 115 Yale L. J. 1256, 1268 (2006) (‘‘these Federalist-era state builders were not oper-
                                      ating with a twenty-first-century kit of administrative understandings either. The idea of ‘office,’
                                      for example, was highly ambiguous—an unsettled blend of public and private stations. This am-
                                      biguity made the legal structure of office-holding problematic along multiple dimensions, from
                                      the way ‘officers’ should be remunerated, to whether and how they were subject to hierarchical
                                      direction and control by administrative superiors, to the means and extent to which they should
                                      be legally responsible in court’’); id. at 1319.
                                         6 Officers of the United States are also ‘‘employees’’ for some purposes—e.g., employment

                                      taxes. See sec. 3401(c). However, the case law interpreting the Appointments Clause uses the
                                      term ‘‘employee’’ to refer to non-officers, and we follow that usage here. The case law also uses
                                      the term ‘‘lesser functionary’’ from Buckley v. Valeo, 424 U.S. 1, 126 n.162 (1976). Whatever its
                                      apparent connotation, that phrase simply starts with the word ‘‘functionary’’—which com-
                                      prehends principal officers and inferior officers, see Ex parte Siebold, 100 U.S. 371, 397–398
                                      (1880) (‘‘as the Constitution stands, the selection of the appointing power, as between the func-
                                      tionaries named, is a matter resting in the discretion of Congress’’)—and observes that employ-
                                      ees subordinate to those functionaries are ‘‘lesser functionaries’’. The Buckley court distin-
                                      guished ‘‘Officers of the United States’’, who are subject to the Appointments Clause, from non-
                                      officer employees who fill ‘‘ ‘offices’ in the generic sense’’, 424 U.S. at 138. That is, not every
                                      employee with the word ‘‘officer’’ in his job title is subject to the Appointments Clause, see Steele
                                      v. United States, 267 U.S. 505, 507 (1925) (‘‘the expression ‘civil officer of the United States duly
                                      authorized to enforce, or assist in enforcing, any law thereof,’ as used in the Espionage Act, does
                                      not mean an officer in the constitutional sense’’), and Mr. Tucker does not contend that ‘‘appeals
                                      officers’’ are subject to the Appointments Clause simply because of their job title.




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                                      same question could arise with respect to the other two
                                      branches of Government. The Constitution has no explicit
                                      provision whatever that authorizes Senators, Representa-
                                      tives, or congressional committees to hire employees of any
                                      sort, whether officers, inferior officers, or lesser functionaries,
                                      but it would be absurd to interpret the constitutional silence
                                      on this matter as a bar to the legislature’s hiring personnel
                                      necessary for its constitutionally mandated functions. 7 For
                                      many years congressional employees were few in number—
                                      but there were always at least a few: By 1792 the list of per-
                                      sonnel for the House included the clerk of the House of Rep-
                                      resentatives, a principal clerk, two engrossing clerks, a chap-
                                      lain, a sergeant-at-arms, a door-keeper, and an assistant
                                      door-keeper, and the list for the Senate included the sec-
                                      retary of the Senate, two clerks, a door-keeper, and an assist-
                                      ant door-keeper 8—a total of thirteen, none of whom were
                                      explicitly authorized in the Constitution. Currently, the total
                                      employment of the Senate and House numbers in the thou-
                                      sands. 9
                                         For the judicial branch the Constitution does include an
                                      explicit provision for subordinate personnel, in that the
                                      Appointments Clause itself provides that ‘‘Congress may by
                                      Law vest the Appointment of such inferior Officers, as they
                                      think proper, in * * * the Courts of Law’’. That is, it is
                                      explicit that ‘‘the Courts of Law’’ may appoint ‘‘inferior Offi-
                                      cers’’. The Judiciary Act of 1789, enacted by the first Con-
                                      gress, provided for clerks of court and marshals, 10 and the
                                        7 As one mundane example, Article I, Section 5, Clause 3 of the Constitution requires each

                                      House to keep and publish ‘‘a Journal of its Proceedings,’’ a function hard to imagine Congress
                                      accomplishing without staff.
                                        8 See ‘‘List of Civil Officers of the United States, Except Judges, With Their Emoluments, For

                                      the Year Ending October 1, 1792’’, at 59 (Feb. 27, 1793), printed in I Documents, Legislative
                                      and Executive, of the Congress of the United States, at 57–58 (Gales & Seaton, 1834) (herein-
                                      after, ‘‘1792 Roll’’). Treasury Secretary Alexander Hamilton submitted the 1792 Roll to the Sen-
                                      ate with the statement that it constituted ‘‘statements of the salaries, fees, and emoluments
                                      * * * of the persons holding civil offices or employments under the United States’’. Id. at 57.
                                      A decade later, in 1802, the combined staff consisted of 14 persons. See ‘‘Roll of the Officers,
                                      Civil, Military, and Naval, of the United States’’, at 302 (Feb. 17, 1802), printed in I Documents,
                                      Legislative and Executive, of the Congress of the United States, at 260–319 (Gales & Seaton,
                                      1834) (hereinafter, ‘‘1802 Roll’’). Treasury Secretary Albert Gallatin transmitted the list to the
                                      President with the statement that it was ‘‘the list of the several officers of Government * * *
                                      as compiled in this or received from the other Departments.’’ President Thomas Jefferson trans-
                                      mitted it to Congress and called it ‘‘a roll of the persons having office or employment under the
                                      United States.’’
                                        9 See    U.S. Office of Personnel Management, Federal Employment Statistics, http://
                                      www.opm.gov/feddata/html/2009/March/table2.asp.
                                        10 Act of Sept. 24, 1789, ch. 20, secs. 7, 27, 1 Stat. 76, 97.




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                                      1792 Roll, at 59–60, does show such personnel on the list.
                                      However, the courts had to maintain courthouses, keep
                                      records, and collect fees, 11 functions for which additional
                                      employees beyond ‘‘inferior Officers’’ would seem to be inevi-
                                      table, if not initially then at least eventually. Currently the
                                      Judicial Branch employs thousands of non-officers. 12
                                         In any event, the courts have acknowledged the practical
                                      necessity for and the propriety of non-officer employees in all
                                      three branches, including the executive. Therefore, in this
                                      case we do not decide whether such employees are constitu-
                                      tionally possible (they are), but whether CDP ‘‘officer[s] or
                                      employee[s]’’ are properly among their number.
                                            C. Modes of appointment under the Appointments Clause
                                        The Appointments Clause provides three modes of appoint-
                                      ment for executive officers—i.e., by Presidential nomination
                                      and Senate confirmation, by the President alone, or by the
                                      Head of a Department. 13 However, as we noted above in part
                                      I.B.1, while the Appointments Clause does allow an exception
                                      for inferior officers to be appointed by the President alone or
                                      by the Secretary, the terms of that exception are that ‘‘Con-
                                      gress may by Law vest the Appointment’’ (emphasis added)
                                      in the President alone or the Head of a Department. Where
                                      Congress has not made any such exception ‘‘by Law’’, then
                                           11 Id.
                                                secs. 3, 5, 1 Stat. 73, 75; Act of Sept. 29, 1789, ch. 21, sec. 2, 1. Stat. 93.
                                           12 See U.S. Office of Personnel Management, Federal Employment Statistics, http://
                                      www.opm.gov/feddata/html/2009/March/table2.asp.
                                          13 For purposes of the Appointments Clause, a department is a ‘‘ ‘freestanding, self-contained

                                      entity in the Executive Branch’ ’’. Free Enter. Fund v. Pub. Co. Accounting Oversight Bd., 561
                                      U.S. ll, ll, 130 S. Ct. 3138, 3162 (2010) (quoting Freytag v. Commissioner, 501 U.S. 868,
                                      915 (1991) (Scalia, J., concurring in part and concurring in judgment)). The parties agree that
                                      the ‘‘Department’’ at issue is the Department of the Treasury (created not in Title 26 of the
                                      United States Code but in Title 31 (‘‘Money and Finance’’), chapter 3), whose head is its Sec-
                                      retary. Respondent does not contend that the IRS itself is a Department nor that the Commis-
                                      sioner is a ‘‘Head’’ who can make appointments under the exception in the Appointments
                                      Clause. The IRS operates not under the direct supervision of the President but ‘‘under the su-
                                      pervision of the Secretary of the Treasury.’’ Sec. 7801(a); see Freytag v. Commissioner, supra
                                      at 886 (‘‘the term ‘Department’ refers only to ‘‘ ‘a part or division of the executive government,
                                      as the Department * * * of the Treasury,’ ’’ expressly ‘creat[ed]’ and ‘giv[en] . . . the name of
                                      a department’ by Congress. Germaine, 99 U.S. at 510–511. * * * Accordingly, the term ‘Heads
                                      of Departments’ does not embrace ‘inferior commissioners and bureau officers.’ Germaine, 99
                                      U.S. at 511’’); Donaldson v. United States, 400 U.S. 517, 534 (1971) (‘‘the Internal Revenue Serv-
                                      ice is organized to carry out the broad responsibilities of the Secretary of the Treasury under
                                      § 7801(a) of the 1954 Code for the administration and enforcement of the internal revenue
                                      laws’’); LaSalle Rolling Mills, Inc. v. U.S. Dept. of Treasury, 832 F.2d 390, 392 (7th Cir. 1987)
                                      (‘‘the IRS * * * is an agency of the Treasury Department’’).




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                                      the default rule applies. 14 Section 7804(a) authorizes the
                                      Commissioner to appoint IRS personnel ‘‘[u]nless otherwise
                                      prescribed by the Secretary’’. We assume that, by that statu-
                                      tory phrase, Congress has, for purposes of the Appointments
                                      Clause, ‘‘vest[ed]’’ in the Secretary the power to appoint IRS
                                      personnel if he chooses to so ‘‘prescribe’’. Therefore, if a given
                                      IRS position (such as a CDP hearing officer) were found to con-
                                      stitute an ‘‘inferior Office[ ]’’ requiring constitutional appoint-
                                      ment, then the Secretary could presumably prescribe that
                                      the Secretary would appoint personnel to fill that office, and
                                      the requirements of the Appointments Clause would be ful-
                                      filled. However, respondent does not contend that the Sec-
                                      retary has made any such prescription or has appointed any
                                      personnel in the Office of Appeals. Consequently, their hiring
                                      does not conform to the Appointments Clause.
                                           D. Appointment of revenue personnel in the late 18th
                                              century
                                         To apply the Appointments Clause to internal revenue per-
                                      sonnel who are affected by the 1998 CDP provisions, we take
                                      instruction from the manner in which internal revenue per-
                                      sonnel were appointed and hired in the years immediately
                                      after the Constitution was ratified. Of course, the earliest
                                      Congresses and executive administrations were not infallible
                                      in their adherence to the Constitution, and their example
                                      cannot be followed uncritically; but we do properly note ‘‘the
                                      early practice of Congress’’, Free Enter. Fund v. Pub. Co.
                                      Accounting Oversight Bd., 561 U.S. ll, ll, 130 S. Ct.
                                      3138, 3162 (2010), particularly where it concerns revenue
                                      personnel, who were by no means an outlying example of
                                      early Federal employment. On the contrary, in that era rev-
                                      enue collection was a significant and conspicuous Federal
                                      effort—both quantitatively and qualitatively. 15 Nonetheless,
                                         14 See Edmond v. United States, 520 U.S. at 660 (‘‘The prescribed manner of appointment for

                                      principal officers is also the default manner of appointment for inferior officers’’); see also Weiss
                                      v. United States, 510 U.S. 163, 187 (1994) (Souter, J., concurring) (‘‘any decision to dispense with
                                      Presidential appointment and Senate confirmation is Congress’s to make’’).
                                         15 In the early years of the Republic, external and internal revenue employees were more than

                                      half the Federal civilian workforce. See Leonard D. White, The Federalists: A Study in Adminis-
                                      trative History 123 (1948). Revenue statutes make up, by pages, roughly 40 percent of the first
                                      volume of Statutes at Large. ‘‘The revenue statutes were the most complexly articulated admin-
                                      istrative system devised by the early Congresses’’. Mashaw, supra at 1278.




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                                      very few internal revenue personnel were appointed under
                                      the Appointments Clause.
                                           1. The Department of the Treasury
                                        The Act that established the Department of the Treasury
                                      on September 2, 1789, created only six offices—the Secretary,
                                      an Assistant to the Secretary, a Comptroller, an Auditor, a
                                      Treasurer, and a Register. 16 Nine days later Congress
                                      authorized the Secretary to ‘‘appoint such clerks * * * as
                                      * * * [he] shall find necessary’’. 17 The organizing Act
                                      charged the Secretary ‘‘to superintend the collection of the
                                      revenue’’, 18 a function that would obviously require a
                                      numerous staff. However, in 1792 the entire staff of the
                                      Treasury Department—from Secretary down to ‘‘messenger
                                      and office-keeper’’—consisted of 110 persons.
                                        The personnel actually employed in the collection of rev-
                                      enue were much more numerous and fell into two categories,
                                      external and internal. The manner of appointment used in
                                      these two categories was notably distinct.
                                           2. External revenue collection
                                        Before establishing the Treasury Department, Congress
                                      had already provided five weeks earlier, in July 1789, for
                                      some of the personnel necessary for collection of ‘‘external
                                      revenue’’, i.e., duties on imports. 19 Congress had provided
                                      that for each port ‘‘a naval officer, collector [20] and surveyor
                                         16 Act of Sept. 2, 1789, ch. 12, 1 Stat. 65 (1789). Except for the Assistant to the Secretary,

                                      who was to ‘‘be appointed by the said Secretary’’, the statute is not explicit as to who appoints
                                      these officers, so the default rule of the Appointments clause applied. The position of Assistant
                                      to the Secretary was later replaced by the Commissioner of the Revenue, who was made respon-
                                      sible for ‘‘collection of the other revenues of the United States’’ (i.e., other than ‘‘duties on impost
                                      and tonnage’’). See Act of May 8, 1792, ch. 37, sec. 6, 1 Stat. 280.
                                         17 See Act of Sept. 11, 1789 (‘‘An Act for establishing the Salaries of the Executive Officers

                                      of the Government, with their Assistants and Clerks’’), ch. 13, sec. 2, 1 Stat. 68; Act of May
                                      8, 1792, ch. 37, sec. 11, 1 Stat. 281 (‘‘the Secretary of the Treasury be authorized to have two
                                      principal clerks’’). Consistent with this statutory authorization, the 1792 Roll, at 57–58, lists the
                                      officials whose offices were named in the organizing statute, and also lists several ‘‘messengers’’
                                      and ‘‘office-keepers’’.
                                         18 Act of Sept. 2, 1789, ch. 12, sec. 2, 1 Stat. 65; see also Act of June 5, 1794, ch. 48, sec.

                                      4, 1 Stat. 376, 378 (‘‘the duties aforesaid shall be received, collected, accounted for, and paid
                                      under and subject to the superintendence, control and direction of the department of the treas-
                                      ury, according to the authorities and duties of the respective offices thereof ’’); Act of May 8,
                                      1792, ch. 37, sec. 6, 1 Stat. 280 (‘‘the Secretary of the Treasury shall direct the superintendence
                                      of the collection of the duties on impost and tonnage as he shall judge best’’).
                                         19 Act of July 31, 1789, ch. 5, secs. 5, 6, 8, 1 Stat. 36–37.
                                         20 These Presidentially appointed external revenue ‘‘collectors’’ were different from the internal

                                                                                                       Continued




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                                      shall be appointed’’, presumably by the President. 21 It was
                                      the duty of the collector ‘‘to employ proper persons as
                                      weighers, gaugers, measurers and inspectors * * *, together
                                      with such persons as shall be necessary to serve in the boats
                                      * * * with the approbation of the principal officer of the
                                      treasury department’’. 22
                                         The next year, 1790, Congress provided that, for the collec-
                                      tion of import duties, ‘‘there shall be established and
                                      appointed, districts, ports and officers’’, with one or more dis-
                                      tricts in every State. 23 The Presidentially appointed posts of
                                      ‘‘collector, naval officer and surveyor’’ were retained in this
                                      regime, and once again they were to employ ‘‘weighers,
                                      gaugers, measurers and inspectors’’, id. sec. 6, 1 Stat. 154,
                                      presumably with the approval of the Secretary as the pre-
                                      vious year’s statute had required. 24
                                         In 1799 Congress authorized the President to build as
                                      many as ten ships called ‘‘revenue cutters’’, each to be
                                      manned by ‘‘one captain or master, and not more than three
                                      lieutenants or mates, first, second, and third, and not more
                                      revenue ‘‘collectors’’ authorized in 1798 and appointed by ‘‘supervisors’’, as discussed infra p.
                                      131.
                                         21 Act of July 31, 1789, ch. 5, sec. 1, 1 Stat. 29. The statute does not state by whom the ‘‘naval

                                      officer, collector and surveyor’’ would be appointed. However, the preamble to the 1802 Treasury
                                      Roll, at 261, describes ‘‘[t]he officers employed in the collection of the external revenue’’ as fall-
                                      ing into three groups, one of which consisted of ‘‘collectors, naval officers, [and] surveyors’’ who
                                      are said to have been ‘‘appointed by the President’’. The statute also allowed for ‘‘other person[s]
                                      specially appointed by either’’ the naval officer, collector, or surveyor to search, seize, and secure
                                      concealed goods. Act of July 31, 1789, ch. 5, sec. 24, 1 Stat. 43 (emphasis added). However, we
                                      infer that those ‘‘special’’ appointments were occasional and temporary; and if so then they did
                                      not constitute ‘‘offices’’. See infra part III.B.1.
                                         22 That position of ‘‘principal officer’’ was established a month later as Secretary of the Treas-

                                      ury. See also, to the same effect, Act of Mar. 2, 1799, ch. 22, sec. 21, 1 Stat. 642. Consistent
                                      with the 1789 statute, the preamble to the 1802 Treasury Roll states that ‘‘port inspectors,
                                      weighers, and gaugers’’ are ‘‘appointed by the collectors, with the approbation of the Secretary
                                      of the Treasury’’. We assume that, by virtue of this required ‘‘approbation’’ of the Secretary,
                                      these appointments satisfied the Appointments Clause as among those appointments that Con-
                                      gress ‘‘vest[ed] * * * in the Heads of Departments’’. See 4 Op. Atty. Gen. 162 (1843) (‘‘approba-
                                      tion’’ of the Secretary required for ‘‘inspectors of the customs’’ in Act of Mar. 3, 1815, ch. 94,
                                      sec. 3, 3 Stat. 232, constituted appointment by the Secretary for purposes of the Appointments
                                      Clause).
                                         23 Act of Aug. 4, 1790, ch. 35, sec. 1, 1 Stat. 145.
                                         24 The collector, naval officer, and surveyor were also authorized to name a ‘‘deputy’’ who

                                      would serve ‘‘in cases of occasional and necessary absence, or of sickness, and not otherwise’’,
                                      id. sec. 7, 1 Stat. 155, and would serve in the case of their disability or death ‘‘until successors
                                      shall be duly appointed’’, id. sec. 8. See also, to the same effect, Act of June 5, 1794, ch. 49,
                                      secs. 1, 12, 1 Stat. 378, 380; Act of Mar. 2, 1799, ch. 22, sec. 22, 1 Stat. 644. Because the depu-
                                      ties’ positions were only temporary, we assume that they were not ‘‘offices’’ within the meaning
                                      of the Appointments Clause, see infra part II.B.1, and that the clause is therefore not implicated
                                      even where those non-appointed deputies were (temporarily) given substantial authority and
                                      discretion.




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                                      than seventy men, including non-commissioned officers, gun-
                                      ners and mariners.’’ 25 (Emphasis added.) The statute pro-
                                      vided that the President appointed the ‘‘officers’’ of the rev-
                                      enue cutters, such as the captains or masters, but did not
                                      appoint the numerous others, such as the non-commissioned
                                      officers. 26 The same statute authorized the local collectors to
                                      ‘‘provide and employ such small open row and sail boats, in
                                      each district, together with the number of persons to serve
                                      in them, as shall be necessary for the use of the surveyors
                                      and inspectors in going on board of ships or vessels and
                                      otherwise, for the better detection of frauds’’, but to do so
                                      ‘‘with the approbation of the Secretary’’, which we take to
                                      constitute an appointment by the Secretary. 27 Cf. supra note
                                      24.
                                         Thus, almost all of the persons employed for external rev-
                                      enue collection under the early statutes either were
                                      appointed by the President or the Secretary, or else were
                                      temporary (i.e., the deputies, occasional inspectors, and per-
                                      sons ‘‘specially appointed’’). The only permanent non-
                                      appointed positions referenced in the statutes were the ‘‘non-
                                      commissioned officers, gunners and mariners’’ for revenue
                                      cutters. 28
                                         Thus the Department of the Treasury and its external rev-
                                      enue staff were virtually all ‘‘appointed’’. However, the
                                      internal revenue personnel (the predecessors of today’s IRS)
                                      were treated differently, as we now show.
                                            3. Internal revenue collection
                                        In 1792 Congress established the office of the Commis-
                                      sioner of the Revenue, who was responsible for collection of
                                      internal revenue. See supra note 16. In the previous year
                                      Congress had already provided that the United States was
                                      divided into fourteen districts for the purpose of collecting
                                      Federal revenue, both internal and external, and it had
                                           25 Act
                                                of March 2, 1799, ch. 22, secs. 97 and 98, 1 Stat. 699.
                                           26 Id.
                                                sec. 99, 1 Stat 700. The preamble to the 1802 Roll, at 261, describes ‘‘[t]he officers em-
                                      ployed in the collection of the external revenue’’ as falling into three groups, one of which con-
                                      sisted of, inter alia, ‘‘masters and mates of revenue cutters’’ who are said to have been ‘‘ap-
                                      pointed by the President’’.
                                        27 Id. sec. 101, 1 Stat. 700. The statute also authorized the collectors to hire temporary and

                                      occasional inspectors. Id. secs. 14, 19, 38, 53, 1 Stat. 636, 640, 658, 667.
                                        28 Id. secs. 97 and 98. The 1802 Roll does not list ‘‘non-commissioned officers, gunners and

                                      mariners’’ but does refer, at 261, to ‘‘bargemen employed by collectors’’. We infer that the 1802
                                      Roll’s ‘‘bargemen’’ are these employees named in the statute.




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                                      authorized for each district ‘‘a supervisor’’ and ‘‘inspectors’’
                                      who were to be appointed by the President with the advice
                                      and consent of the Senate. 29 However, that 1791 Act had
                                      also provided ‘‘[t]hat the supervisor of each district shall
                                      appoint proper officers to have the charge and survey of the
                                      distilleries within’’ the district, 30 with no requirement that
                                      the Secretary’s approval be obtained.
                                         A 1794 internal revenue statute that imposed duties on
                                      carriages provided for duties to ‘‘be levied, collected, received
                                      and accounted for, by and under the immediate direction of
                                      the supervisors and inspectors of the revenue, and other offi-
                                      cers of inspection’’. 31 A similar act in 1796, also imposing
                                      duties on carriages, referred to ‘‘officers or persons employed
                                      under’’ the supervisors and inspectors. 32 In 1798 the super-
                                      visors were authorized to hire clerks. 33 These ‘‘proper offi-
                                      cers’’ (authorized in 1791), ‘‘other officers of inspection’’
                                      (authorized in 1794), ‘‘officers or persons employed under’’
                                      them (referred to in 1796), and clerks (authorized in 1798)
                                      were thus not appointed by the President nor by the Head
                                      of a Department.
                                         In July 1798 Congress imposed a direct tax of $2 million,
                                      apportioned among the States, to be assessed on ‘‘dwelling
                                      houses, lands and slaves’’. 34 In the same month Congress
                                      provided for the appointment of additional internal revenue
                                      personnel to perform the necessary enumerations and valu-
                                      ations. Act of July 9, 1798 (‘‘An Act to provide for the valu-
                                      ation of Lands and Dwelling-Houses, and the enumeration of
                                      Slaves within the United States’’), ch. 70, sec. 1, 1 Stat. 580.
                                      For revenue purposes Congress subdivided the States into
                                      various ‘‘divisions’’, id., and provided that the President
                                      would appoint a ‘‘commissioner’’ for each division, id. sec. 3,
                                           29 Act
                                                of Mar. 3, 1791, ch. 15, sec. 4, 1 Stat. 199.
                                           30 Id.
                                               sec. 18, 1 Stat. 203 (emphasis added); see also Act of June 5, 1794, ch. 48, sec. 3, 1 Stat.
                                      377 (referring to ‘‘the several officers of inspection acting under’’ the supervisors).
                                         31 Act of June 5, 1794, ch. 45, sec. 2, 1 Stat. 374.
                                         32 Act of May 28, 1796, ch. 37, sec. 11, 1 Stat. 481.
                                         33 Act of July 11, 1798, ch. 71, sec. 2, 1 Stat. 592; see also Act of Apr. 6, 1802, ch. 19, sec.

                                      5, 2 Stat. 150. In 1805 the Secretary was authorized to employ clerks to serve under the direc-
                                      tion of the supervisor of the district of South Carolina. See Act of Jan. 30, 1805, ch. 11, sec.
                                      1, 2 Stat. 311.
                                         34 Act of July 14, 1798 (‘‘An act to lay and collect a direct tax within the United States’’), ch.

                                      75, secs. 1 and 2, 1 Stat. 597, 598. Section 8 of Article I of the Constitution permits Congress
                                      ‘‘To lay and collect Taxes’’; but before the ratification of the 16th Amendment, ‘‘No capitation,
                                      or other direct, Tax shall be laid, unless in proportion to the Census or Enumeration herein be-
                                      fore directed to be taken.’’




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                                      1 Stat. 584. (Each of the commissioners was authorized to
                                      appoint a clerk, id. sec. 5; and as is noted below, each
                                      commissioner was authorized in 1800 to appoint his own
                                      ‘‘assistant’’.) The commissioners within the several States
                                      were authorized collectively to ‘‘divide their respective states
                                      into a suitable and convenient number of assessment dis-
                                      tricts, within each of which they shall appoint one respect-
                                      able freeholder to be principal assessor, and such number of
                                      respectable freeholders to be assistant assessors, as they shall
                                      judge necessary for carrying this act into effect’’. Id. sec. 7
                                      (emphasis added). These assessors and assistant assessors
                                      (appointed not by the President or the Secretary but by the
                                      Presidentially appointed commissioners) were ‘‘to value and
                                      enumerate the said dwelling-houses, lands and slaves’’, id.
                                      sec. 8, 1 Stat. 585, in order to establish the tax base against
                                      which the tax would be collected. One commentator observed:
                                        The tax on land, dwellings, and slaves (1798) * * * involved a wide area
                                      of official discretion. It required a valuation of property * * * for which
                                      Congress formulated some general rules that left the assessment largely
                                      to the judgment of local assessors—but subject to an administrative
                                      review.

                                      Leonard White, The Federalists: A Study in Administrative
                                      History, 452 (1948).
                                        For the collection itself, the 1798 Act provided that the
                                      supervisors (Presidentially appointed) were ‘‘authorized and
                                      required to appoint such and so many suitable persons in
                                      each assessment district within their respective districts, as
                                      may be necessary for collecting the said tax’’. Act of July 14,
                                      1798, ch. 75, sec. 4, 1 Stat. 599. If a property owner did not
                                      pay the tax upon demand, then the ‘‘collector’’ (again,
                                      appointed not by the President or the Secretary but by the
                                      Presidentially appointed supervisors) 35 could ‘‘proceed to col-
                                      lect the said taxes, by distress and sale of the goods, chattels
                                      or effects of the persons delinquent’’. Id. sec. 9, 1 Stat. 600.
                                        Another statute from 1798 allowed a property owner who
                                      disputed a valuation to appeal the matter to the principal
                                      assessor. Act of July 9, 1798, ch. 70, secs. 19 and 20, 1 Stat.
                                      588. (No provision is made for a further appeal to the Presi-
                                      dentially appointed commissioner, but the commissioner did
                                        35 The 1802 Roll, at 261, confirms that the ‘‘collectors and auxiliary officers [were] appointed

                                      by the supervisors’’.




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                                      have the power ‘‘to revise, adjust and vary the valuations
                                      * * * as shall appear to be just and equitable’’. Id. sec. 22,
                                      1 Stat. 589. 36) The right of appeal from an assessor’s valu-
                                      ation did have an exception: Where a property owner had
                                      submitted a property list that a court found to be ‘‘false and
                                      fraudulent’’, the assessor was authorized to make a valuation
                                      and enumeration ‘‘from which there shall be no appeal’’.
                                         This 1798 Act provided for an additional official appointed
                                      neither by the President nor by the Secretary: The super-
                                      visors and inspectors (i.e., created in the 1791 and 1794 Acts)
                                      were authorized ‘‘to depute one skilful and fit person, in each
                                      assessment district, to be surveyor of the revenue’’. Id. sec. 24
                                      (emphasis added). 37 A ‘‘surveyor of the revenue’’ was a posi-
                                      tion different from the ‘‘surveyors’’ appointed by the Presi-
                                      dent pursuant to the original 1789 Act. The principal duties
                                      of the surveyor of the revenue were: (1) to preserve ‘‘the
                                      records of the lists, valuations and enumerations’’ made
                                      pursuant to the Act; (2) to make appropriate charges and
                                      credits when property was sold; (3) to apportion value when
                                      property was divided; (4) to value and assess newly built
                                      houses; and (5) subject to the approval of the (Presidentially
                                      appointed) inspector of the survey, to reduce valuations when
                                      property was damaged or destroyed. Id. sec. 25. (In 1800 the
                                      surveyor of the revenue was also empowered, when property
                                      had been omitted from the lists, to ‘‘make a list and valu-
                                      ation thereof ’’. 38)
                                         In 1800 the Presidentially appointed commissioners were
                                      permitted to hire ‘‘such assistants as they shall find nec-
                                      essary, and appoint for that purpose’’, i.e., for the purpose of
                                      completing additions to or reductions of assessments that the
                                      commissioner has directed. 39
                                         In sum, the early internal revenue statutes authorized the
                                      employment not only of Presidentially appointed supervisors
                                      and inspectors but also of the following personnel who were
                                      not appointed by the President or the Secretary (and whose
                                      positions were not temporary, like the deputies’):
                                           36 See,
                                                to the same effect, Act of Jan. 2, 1800, ch. 3, sec. 1, 2 Stat. 4.
                                           37 See
                                               also Act of Jan. 30, 1805, ch. 11, sec. 2, 2 Stat. 312.
                                        38 Act of May 13, 1800, ch. 60, sec. 1, 2 Stat. 80.

                                        39 Act of Jan. 2, 1800, ch. 3, sec. 2, 2 Stat. 4 (emphasis added). See also, to the same effect,

                                      Act of May 10, 1800, ch. 53, sec. 2, 2 Stat. 72.




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                                        • ‘‘proper officers to have the charge and survey of the
                                      distilleries’’, Act of Mar. 3, 1791, ch. 15, sec. 18;
                                        • ‘‘officers or persons employed under’’ the supervisors
                                      and inspectors, Act of May 28, 1796, ch. 37, sec. 11;
                                        • ‘‘clerks’’ hired by the supervisors and commissioners,
                                      Act of July 11, 1798, ch. 71, sec. 2; Act of Apr. 16, 1802, ch.
                                      19, sec. 5;
                                        • ‘‘principal assessors’’ and ‘‘assistant assessors’’, Act of
                                      July 9, 1798, ch. 70, sec. 7;
                                        • ‘‘collectors’’, Act of July 14, 1798, ch. 75, secs. 4, 9;
                                        • ‘‘surveyors of the revenue’’, Act of July 9, 1798, ch. 70,
                                      sec. 24; and
                                        • ‘‘assistants’’ to the commissioners, Act of Jan. 2, 1800,
                                      ch. 3, sec. 2.
                                        The 1802 Roll, at 280–288, lists 16 supervisors and 24
                                      inspectors, thus totaling 40 Presidentially appointed internal
                                      revenue personnel. It also lists 40 clerks, 361 collectors, 34
                                      collectors’ clerks, and 102 ‘‘Auxiliary officers’’ (apparently a
                                      generic term for the other personnel authorized in the stat-
                                      utes). The ‘‘collectors and auxiliary officers, appointed by the
                                      supervisors’’, id. at 261 (emphasis added), are significantly
                                      more numerous than the Presidentially appointed super-
                                      visors and inspectors.
                                            E. Subsequent appointment of internal revenue personnel
                                        In his first inaugural address, President Thomas Jefferson
                                      called for the repeal of the original internal revenue taxes,
                                      and that repeal took place in 1802. 40 Thereafter there were
                                      four iterations of the internal revenue tax, before the modern
                                      regime that is still in place today; 41 and the pattern of
                                      appointments that had been set for internal revenue in the
                                      late 18th century was followed in those four subsequent
                                      internal revenue statutes. That is, non-appointed personnel
                                      hired by persons inferior to the Secretary of the Treasury
                                      had more than ministerial responsibility in internal revenue
                                      statutes enacted during the War of 1812, 42 during the Civil
                                           40 SeeAct of Apr. 6, 1802, ch. 19, 2 Stat. 148.
                                           41 SeeLucius A. Buck, ‘‘Federal Tax Litigation and the Tax Division of the Department of Jus-
                                      tice’’, 27 Va. L. Rev. 873, 875–877 (1941).
                                         42 See Act of July 22, 1813, ch. 16, secs. 3, 8, 20–22, 3 Stat. 26, 27, 30, 31 (Assistant Assessors

                                      could correct fraudulent property lists without any taxpayer appeal right; Deputy Collectors
                                      could seize and sell personal and real property).




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                                      War and Reconstruction, 43 after the ratification of the 16th
                                      Amendment, 44 and in connection with the first World War. 45
                                         The pattern set in the late 18th century persists today:
                                      The general authority of the Secretary of the Treasury is
                                      described in 31 U.S.C. sec. 321 (2006), and it does not include
                                      employment or appointment of internal revenue personnel.
                                      ‘‘The Secretary of the Treasury is authorized to appoint
                                      * * * such attorneys and other officers and employees as he
                                      may deem necessary’’ in the Customs Service for external
                                      revenue collection, 19 U.S.C. sec. 2072(a) (2006); but the Sec-
                                      retary does not generally make appointments for internal
                                      revenue collection. Rather, ‘‘the Commissioner of Internal
                                      Revenue is authorized to employ such number of persons as
                                      the Commissioner deems proper for the administration and
                                      enforcement of the internal revenue laws’’. Sec. 7804(a).
                                      II. The Internal Revenue Service Office of Appeals
                                           A. The legal basis for the Office of Appeals
                                        The Office of Appeals is a component of the IRS within the
                                      Department of the Treasury. The Office of Appeals was not
                                      created by the CDP provisions at issue here (i.e., sections
                                      6320 and 6330), which were added to the Internal Revenue
                                        43 See Act of Aug. 5, 1861, ch. 45, secs. 11, 34, 51, 12 Stat. 296, 303, 310 (Assistant Assessors

                                      are described with less detail; Assistant Collectors could levy upon property and could arrest
                                      and imprison taxpayers who refused to testify); Act of July 1, 1862, ch. 119, secs. 3, 5, 9, 12
                                      Stat. 433–435 (Assistant Assessors and Deputy Collectors with powers similar to those in 1813);
                                      Act of June 30, 1864, ch. 173, secs. 8, 10, 13, 14, 52, 118, 13 Stat. 224–227, 242, 282 (Assistant
                                      Assessors and Deputy Collectors were given powers similar to those in 1862 (but arrest power
                                      was replaced with summons authority and power to apply to a judge for arrest for contempt),
                                      and both could also administer oaths and take evidence; Assistant Assessor could adjust taxable
                                      income upward ‘‘if he shall be satisfied’’ that income was understated, with appeal of any such
                                      increase to the assessor); Act of Mar. 3, 1865, ch. 78, 13 Stat. 480 (Assistant Assessor can adjust
                                      taxable income upward ‘‘if he has reason to believe’’ that income is understated); Act of July
                                      13, 1866, ch. 184, secs. 4, 9, 14 Stat. 99, 126, (Assistant Assessors could give permits for cigar-
                                      making; Deputy Collectors could hold cotton until tax on it had been paid); Act of Mar. 2, 1867,
                                      ch. 169, secs. 19, 20, 14 Stat. 482 (any internal revenue officer could be authorized to seize prop-
                                      erty and could seize barrels if they had reason to believe that taxes on them had not been paid);
                                      Act of July 14, 1870, ch. 255, sec. 36, 16 Stat. 271 (weighers, gaugers, measurers, and inspec-
                                      tors).
                                        44 See Act of Oct. 3, 1913, ch. 16, 38 Stat. 169, 179 (a Deputy Collector could demand that

                                      a taxpayer show cause why the income amount on the return should not be increased and, if
                                      no return or a false or fraudulent return had been provided, could make a return based on the
                                      best information he could obtain, which return was then to be held prima facie good and suffi-
                                      cient for all legal purposes).
                                        45 See Act of Sept. 8, 1916, ch. 463, secs. 16–22, 39 Stat. 774–776 (Deputy Collector had pow-

                                      ers similar to those in 1913); Act of Feb. 24, 1919, ch. 18, sec. 1317, 40 Stat. 1146–1148 (Deputy
                                      Collector had powers similar to those in 1913 and 1916, and could administer oaths and take
                                      evidence).




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                                      Code in 1998, nor by the several other provisions of the Code
                                      that mention the Office of Appeals. 46 Rather, all these statu-
                                      tory provisions presume its prior existence. In its current
                                      form the Office of Appeals exists pursuant to section 7804(a),
                                      which provides:
                                      SEC. 7804. OTHER PERSONNEL.
                                        (a) APPOINTMENT AND SUPERVISION.—Unless otherwise prescribed by the
                                      Secretary, the Commissioner of Internal Revenue is authorized to employ
                                      such number of persons as the Commissioner deems proper for the
                                      administration and enforcement of the internal revenue laws, and the
                                      Commissioner shall issue all necessary directions, instructions, orders, and
                                      rules applicable to such persons.

                                      Congress thus provided that, except as the Secretary other-
                                      wise prescribes, it is the Commissioner and not the Secretary
                                      who shall ‘‘employ’’ (not ‘‘appoint’’) other personnel in the
                                      Internal Revenue Service. 47 Pursuant to this congressional
                                      mandate, the Commissioner established the Office of Appeals
                                      and employed personnel to staff that office. The stated mis-
                                      sion of the Office of Appeals is to resolve tax controversies
                                      without litigation. This mission as well as the operating
                                      directives and guidelines of the Office of Appeals are set
                                      forth in the Internal Revenue Manual (IRM). 48
                                           B. A brief history of the Office of Appeals
                                        The first precursor to the Office of Appeals was established
                                      by statute—i.e., by the Revenue Act of 1918, ch. 18, 40 Stat.
                                      1057. Then known as the Advisory Tax Board, it had the
                                      authority only to offer its recommendation on cases sub-
                                      mitted to it by the Commissioner. The Advisory Tax Board
                                      was soon replaced by the Committee on Appeals and Review,
                                         46 See secs. 6015(c)(4)(B)(ii)(I) (innocent spouse relief), 6603(d)(3)(B) (deposits), 6621(c)(2)(A)(i)

                                      (interest rates), 7122(e)(2) (taxpayer appeal of denial of offer-in-compromise), 7123 (Appeals dis-
                                      pute resolution procedures), 7430(c)(2), (c)(7), (g)(2) (reasonable administrative and litigation
                                      costs), 7522(b)(3) (content of letter of proposed deficiency), 7612(c)(2)(A) (protection of confiden-
                                      tial information on taxpayer software). Mr. Tucker describes section 7122(e) as if it provides for
                                      a ‘‘right to appeal * * * to an Appeals Officer’’, but the statute mentions no officer.
                                         47 One exception to this general rule is present in 5 U.S.C. sec. 9503(a) (2006), which author-

                                      izes the Secretary of the Treasury to appoint up to 40 individuals to critical administrative,
                                      technical, and professional positions in the IRS before July 23, 2013, provided that such individ-
                                      uals were not IRS employees before June 1, 1998, and that their appointments are limited to
                                      no more than 4 years.
                                         48 According to the Internal Revenue Manual (IRM), ‘‘The Appeals Mission is to resolve tax

                                      controversies, without litigation, on a basis which is fair and impartial to both the Government
                                      and the taxpayer and in a manner that will enhance voluntary compliance and public confidence
                                      in the integrity and efficiency of the Service.’’ IRM pt. 8.1.1.1(1) (Oct. 23, 2007).




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                                      which was given the authority to hear administrative
                                      appeals from taxpayers and redetermine their deficiencies
                                      pursuant to the Revenue Act of 1921, ch. 36, 42 Stat. 227.
                                      The name and structure of the appeals function of the IRS
                                      has changed several times since then, 49 but its mission to
                                      resolve tax controversies without litigation has remained the
                                      same. See IRS Document 7225, History of Appeals, 60th
                                      Anniversary Edition 3–6 (Nov. 1987).
                                        However, in the Internal Revenue Service Restructuring
                                      and Reform Act of 1998 (RRA), Pub. L. 105–206, 112 Stat.
                                      685, Congress enacted provisions that directly addressed the
                                      appeals function. One of the four required features of the
                                      plan of reorganization that the IRS was to undertake was
                                      that it ‘‘ensure an independent appeals function within the
                                      Internal Revenue Service’’. Id. sec. 1001(a)(4), 112 Stat. 689.
                                      Explicit reference to the Office of Appeals was added to the
                                      Code not only in the new CDP procedures in sections 6320
                                      and 6330 but also in sections 6015(c)(4)(B)(ii)(I), 7122(d)(2)
                                      (now designated (e)(2)), 7123, 7430(c)(2) and (g)(2)(A), and
                                      7612(c)(2)(A).
                                           C. ‘‘Appeals Officers’’ in the Office of Appeals
                                           1. The Pre-CDP Role of the ‘‘Appeals Officer’’
                                         The position of ‘‘Appeals Officer’’ has existed within the
                                      Office of Appeals since 1978. IRS Document 7225, supra at 3–
                                      5. Mr. Tucker does not argue that any Office of Appeals’ per-
                                      sonnel were ‘‘inferior Officers’’ before the passage of the RRA,
                                      but he asserts that as a result of the RRA those positions pos-
                                      sessed authority that may be consitutionally exercised only
                                      by an ‘‘officer of the United States’’.
                                         The position of ‘‘Appeals Officer’’—as well as earlier posi-
                                      tions within the Office of Appeals and its predecessors—had
                                      the authority to make deficiency determinations and hear
                                      collection-related appeals long before the passage of the RRA,
                                      which enacted the CDP regime. The appeals function had the
                                        49 The Committee on Appeals and Review was abolished on June 2, 1924, in favor of creating

                                      the Board of Tax Appeals because it was thought that a judicial tribunal would better serve
                                      taxpayers. IRS Document 7225, History of Appeals, 60th Anniversary Edition 3 (Nov. 1987).
                                      However, in response to the rapidly growing docket of the Board of Tax Appeals, the Special
                                      Advisory Committee was formed as a part of the Commissioner’s office to reprise the role of the
                                      Committee on Appeals and Review. Id. This Court is the successor to the (statutory) Board of
                                      Tax Appeals, and the Office of Appeals is the successor to the Special Advisory Committee. See
                                      id.




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                                      authority to redetermine deficiencies since 1921. IRS Docu-
                                      ment 7225, supra at 3. And it had the authority to hear
                                      collection-related appeals under the collection appeals pro-
                                      gram (CAP) since 1996. 50 IRM pt. 8.24.1.1.1 (May 27, 2004).
                                         ‘‘CAP is an administrative review program not required by
                                      statute.’’ Offiler v. Commissioner, 114 T.C. 492, 494 (2000).
                                      In 1996 the IRS created CAP to provide taxpayers with the
                                      right to appeal lien, levy, and seizure actions. IRM pt.
                                      8.24.1.1.1(1) (May 27, 2004). In 1997 CAP was expanded to
                                      implement the Taxpayer Bill of Rights 2, Pub. L. 104–168,
                                      110 Stat. 1457 (1996), in order to provide taxpayers with the
                                      right to appeal the proposed termination of installment
                                      agreements. IRM pt. 8.24.1.1.1(2) (May 27, 2004); see also sec.
                                      7122(e)(2). Although Congress did not codify CAP, the legisla-
                                      tive history of the RRA shows that Congress was aware of CAP
                                      when it enacted the CDP regime (discussed below). See S.
                                      Rept. 105–174, at 92 (1998), 1998–3 C.B. 537, 628.
                                           2. ‘‘Collection Due Process’’ procedures added to the Code
                                               in 1998
                                        If a taxpayer fails to pay any Federal income tax liability
                                      after notice and demand, chapter 64 of the Code provides two
                                      means by which the IRS can collect the tax: First, section
                                      6321 imposes a lien in favor of the United States on all the
                                      property of the delinquent taxpayer, and section 6323(f)
                                      authorizes the IRS to file notice of that lien; second, section
                                      6331(a) authorizes the IRS to collect the tax by levy on the
                                      taxpayer’s property. 51
                                        However, in 1998 Congress added to chapter 64 of the
                                      Code certain provisions (in subchapter C, part I, and in sub-
                                         50 Today both CAP and the CDP regime (discussed below) are administered by the Office of

                                      Appeals. IRM pt. 8.24.1.1.1 (May 27, 2004). As a result, a taxpayer may be eligible to request
                                      either a CAP or CDP hearing with respect to a lien or levy. Id. However, taxpayers are eligible
                                      for CAP hearings in more circumstances than CDP hearings. Publication 1660, Collection Ap-
                                      peal Rights 3 (rev. 03–2007). For example, a taxpayer is eligible for a CAP hearing when a CDP
                                      hearing is unavailable because the taxpayer already had a CDP hearing or failed to timely re-
                                      quest such a hearing. IRM pt. 8.24.1.1.1(6) (May 27, 2004).
                                         51 Although this case involves only an Office of Appeals determination to sustain a notice of

                                      lien and not a determination to proceed with a levy, the function of the ‘‘appeals officer’’ that
                                      pertains to levies should be considered in determining the nature of that position. Cf. Freytag
                                      v. Commissioner, 501 U.S. at 882 (‘‘The fact that an inferior officer on occasion performs duties
                                      that may be performed by an employee not subject to the Appointments Clause does not trans-
                                      form his status under the Constitution. If a special trial judge is an inferior officer for purposes
                                      of * * * [some of his duties], he is an inferior officer within the meaning of the Appointments
                                      Clause and he must be properly appointed’’).




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                                      chapter D, part I) as ‘‘Due Process for Liens’’ and ‘‘Due
                                      Process for Collections’’. The IRS must comply with those
                                      provisions after filing a tax lien and before proceeding with
                                      a levy. Explicit mention of ‘‘appeals officers’’ was introduced
                                      by the RRA into these CDP provisions. 52 In the following brief
                                      description of those CDP procedures, we emphasize phrases
                                      from the statute that are important to the later analysis in
                                      this Opinion.
                                         Within five business days after filing a tax lien, the IRS
                                      must provide written notice of that filing to the taxpayer.
                                      Sec. 6320(a). After receiving such a notice, the taxpayer may
                                      request an administrative hearing to ‘‘be held by the Internal
                                      Revenue Service Office of Appeals.’’ 53 Sec. 6320(b)(1)
                                      (emphasis added). Similarly, before proceeding with a levy,
                                      the IRS must issue a final notice of intent to levy and must
                                      notify the taxpayer of the right to an administrative hearing
                                      to ‘‘be held by the Internal Revenue Service Office of
                                      Appeals.’’ Sec. 6330(a) and (b)(1) (emphasis added). Section
                                      6330(b)(3), entitled ‘‘Impartial officer’’ (emphasis added), pro-
                                      vides that ‘‘[t]he hearing under this subsection shall be con-
                                      ducted by an officer or employee who has had no prior
                                      involvement with respect to the unpaid tax’’ at issue
                                      (emphasis added).
                                         The pertinent procedures for the agency-level CDP hearing
                                      are set forth in section 6330(c). First, the statute provides,
                                      ‘‘The appeals officer shall at the hearing obtain verification
                                      from the Secretary that the requirements of any applicable
                                      law or administrative procedure have been met.’’ Sec.
                                      6330(c)(1) (emphasis added). Second, the taxpayer may ‘‘raise
                                      at the hearing any relevant issue relating to the unpaid tax
                                      or the proposed levy,’’ including challenges to the appro-
                                        52 The Internal Revenue Service Restructuring and Reform Act of 1998 (RRA), Pub. L. 105–

                                      206, 112 Stat. 685, also included three references to ‘‘appeals officers’’ that are not codified in
                                      the Internal Revenue Code. RRA section 3465(b), 112 Stat. 768, 1998–3 C.B. 228, provides: ‘‘The
                                      Commissioner of Internal Revenue shall ensure that an appeals officer is regularly available
                                      within each State’’; RRA section 1001(a)(4), 112 Stat. 689, 1998–3 C.B. 149, provides that the
                                      reorganization plan should prohibit ‘‘ex parte communications between appeals officers and
                                      other Internal Revenue Service employees’’; and RRA section 3465(c), 112 Stat. 768, 1998–3 C.B.
                                      228, provides that the IRS should ‘‘consider the use of the videoconferencing of appeals con-
                                      ferences between appeals officers and taxpayers seeking appeals in rural or remote areas.’’ (Em-
                                      phasis added.)
                                        53 To the extent practicable, a CDP hearing concerning a lien under section 6320 is to be held

                                      in conjunction with a CDP hearing concerning a levy under section 6330, and the conduct of
                                      the lien hearing is to be in accordance with the relevant provisions of section 6330. See sec.
                                      6320(b)(4), (c).




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                                      priateness of the collection action and offers of collection
                                      alternatives. Sec. 6330(c)(2)(A). Additionally, the taxpayer
                                      may contest the existence and amount of the underlying tax
                                      liability, but only if he did not receive a notice of deficiency
                                      or otherwise have an opportunity to dispute the tax
                                      liability. 54 Sec. 6330(c)(2)(B). Section 6330(c)(3) then pro-
                                      vides, ‘‘The determination by an appeals officer under this
                                      subsection shall take into consideration’’ (emphasis added)—
                                      (1) the verification that he obtained, (2) the issues raised by
                                      the taxpayer, and (3) a balancing of the need for efficient tax
                                      collection with concerns that the collection be no more intru-
                                      sive than necessary.
                                         The authority to conduct CDP hearings and make deter-
                                      minations under sections 6320 and 6330 has been delegated
                                      to three positions within the Office of Appeals: (i) ‘‘Appeals
                                      Officers’’, (ii) ‘‘Settlement Officers’’, and (iii) ‘‘Appeals Account
                                      Resolution Specialists’’. 55 Appeals Delegation Order 8–a, IRM
                                      Exhibit 8.22.2–4 (Nov. 1, 2006). The authority to review and
                                      approve those determinations is delegated to team managers.
                                      Id. Today, in practice, settlement officers conduct CDP
                                      hearings and make an initial determination that is subse-
                                      quently approved or overruled by a team manager, who
                                      makes the final determination on behalf of the Office of
                                      Appeals.
                                         If the taxpayer is not satisfied with the determination he
                                      receives from the Office of Appeals, the taxpayer may ‘‘appeal
                                      such determination to the Tax Court’’. Sec. 6330(d)(1). Where
                                      challenges to the underlying liability are at issue (under sec-
                                      tion 6330(c)(2)(B)), the Tax Court reviews the determination
                                      de novo. Davis v. Commissioner, 115 T.C. 35, 39 (2000). For
                                      other disputes, the Tax Court reviews the determination for
                                      abuse of discretion, Sego v. Commissioner, 114 T.C. 604, 610
                                      (2000); Goza v. Commissioner, 114 T.C. 176, 182 (2000)—that
                                      is, to determine whether the determination was arbitrary,
                                         54 Mr. Tucker did not challenge his underlying liabilities (which were, in fact, the liabilities

                                      that he himself had reported on his late returns). However, as we observed supra note 51, in
                                      order to determine the nature of the ‘‘appeals officer’’ position, we should consider all of its func-
                                      tions, not only those that were operative in this case.
                                         55 Mr. Tucker complains that ‘‘AARS is a fancy title for an even lower pay grade person who

                                      the IRS used to call a ‘screener’ ’’ and that AARSs are ‘‘now holding CDP hearings in certain
                                      low-dollar situations’’. However, no CDP determination is issued until it has been reviewed and
                                      approved by a higher ranking team manager. If the Office of Appeals were to assign CDP hear-
                                      ings to employees untrained in or incapable of the task, their inadequate performance would
                                      be subject to review by this Court.




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                                      capricious, or without sound basis in fact or law, see Murphy
                                      v. Commissioner, 125 T.C. 301, 320 (2005), affd. 469 F.3d 27
                                      (1st Cir. 2006).
                                         Congress enacted these procedures in order to grant tax-
                                      payers ‘‘protections in dealing with the IRS that are similar
                                      to those they would have in dealing with any other creditor’’,
                                      that is, in order to ‘‘afford taxpayers adequate notice of
                                      collection activity and a meaningful hearing before the IRS
                                      deprives them of their property.’’ S. Rept. 105–174, supra at
                                      67, 1998–3 C.B. at 603. It is fair to say that the officer or
                                      employee who conducts the CDP hearing is performing a crit-
                                      ical role in an important tax proceeding.
                                           3. Post-CDP hearing procedures
                                         However, because the ‘‘finality’’ of an Office of Appeals
                                      determination is relevant to the appeals officer’s status as an
                                      ‘‘officer’’ under the Appointments Clause, it is pertinent to
                                      note the circumstances in which the IRS may face again the
                                      same taxpayer whose collection issues and underlying
                                      liability have been previously considered by the Office of
                                      Appeals in a CDP hearing, and to discern the extent, if any,
                                      to which the IRS will be bound to the determination made in
                                      the CDP context—either a determination on a liability issue
                                      (whether the tax is owed) or determination on a collection
                                      issue (whether and how the tax will be collected).
                                           a. Collection issues
                                        If the CDP officer or employee enters into an installment
                                      agreement under section 6159, a closing agreement under
                                      section 7121, or an OIC under section 7122 with the taxpayer,
                                      then of course the agency will be bound under general con-
                                      tract principles to honor the agreement. 56 However the
                                      agency is also bound to honor such agreements that it enters
                                      into outside of the CDP context, whether by the Office of
                                      Appeals or by another branch of the IRS. Consequently, the
                                      authority to enter into such agreements on behalf of the IRS
                                        56 In addition, if an agreement embodied in Form 870–AD, ‘‘Offer of Waiver of Restrictions

                                      on Assessment and Collection of Deficiency in Tax and of Acceptance of Overassessment’’, is ac-
                                      cepted by the IRS and executed with the taxpayer, equitable estoppel may apply to make that
                                      agreement binding on all functions of the IRS. See Kretchmar v. United States, 9 Cl. Ct. 191,
                                      198 (1985).




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                                      is not peculiar to an officer or employee conducting a CDP
                                      hearing.
                                        However, the CDP hearing may yield a determination by
                                      the Office of Appeals that is not embodied in one of those
                                      agreements, such as a determination that the taxpayer
                                      should be put in ‘‘currently not collectible’’ (CNC) status, see
                                      IRM pt. 8.22.2.4 (Mar. 11, 2009), 8.23.3.13 (Aug. 28, 2009), or
                                      that a lien should be released or subordinated, see sec. 6325;
                                      IRM pt. 8.22.3.9.6.1 (Apr. 8, 2009), 8.22.3.9.6.2 (Oct. 19, 2007),
                                      8.22.2.4.6 (Dec. 1, 2006), or that a levy should be released,
                                      see sec. 6343; IRM pt. 8.22.3.9.5 (Apr. 8, 2009). We find no
                                      authority addressing any binding character of these deter-
                                      minations, but we assume that their force is enhanced by
                                      section 6330(d)(2), which provides:
                                        (2) JURISDICTION RETAINED AT IRS OFFICE OF APPEALS.—The Internal
                                      Revenue Service Office of Appeals shall retain jurisdiction with respect to
                                      any determination made under this section, including subsequent hearings
                                      requested by the person who requested the original hearing on issues
                                      regarding—
                                          (A) collection actions taken or proposed with respect to such deter-
                                        mination; and
                                          (B) after the person has exhausted all administrative remedies, a
                                        change in circumstances with respect to such person which affects such
                                        determination.

                                      That is, we assume that the retention of ‘‘jurisdiction’’ by the
                                      Office of Appeals ‘‘with respect to any determination’’ would
                                      bar IRS collection personnel from contradicting Appeals’
                                      collection determination. If collection personnel undertook
                                      collection action in violation of Appeals’ determination, then
                                      that action could be halted by Appeals in a retained jurisdic-
                                      tion hearing. Even so, the sense in which Appeals’ collection
                                      determination can be said to be binding is qualified in sev-
                                      eral significant respects:
                                         First, section 6330(d)(2) would bind only non-Appeals func-
                                      tions. The Office of Appeals itself, if it ‘‘retains jurisdiction’’,
                                      must retain jurisdiction to modify its determination.
                                         Second, if the Office of Appeals sustains the notice of lien
                                      or intent to levy, there are circumstances in which the IRS 57
                                        57 If the taxpayer challenges the validity of a lien in an action to quiet title under 28 U.S.C.

                                      sec. 2410 in Federal District Court, the Government will be represented not by the IRS attor-
                                      neys in the Office of Chief Counsel but by the Department of Justice, pursuant to 28 U.S.C.
                                      sec. 516. If the Department of Justice concludes that the lien is not valid, then there is no ap-
                                                                                                    Continued




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                                      thereafter may forgo collection or make accommodations
                                      nonetheless. Collection personnel may perform the investiga-
                                      tion required by section 6331(j) and decide not to proceed
                                      with a levy against specific property. Collection personnel
                                      retain the power to withdraw a notice of lien pursuant to sec-
                                      tions 6323(j), to release a lien pursuant to section 6325, and
                                      to release a levy pursuant to section 6343. The taxpayer is
                                      always free to submit to IRS collection personnel another pro-
                                      posal of an installment agreement or an OIC, and those per-
                                      sonnel have authority to accept that new proposal notwith-
                                      standing the Office of Appeals’ rejection of the taxpayer’s
                                      prior proposal. See IRM pt. 1.2.44.2. 58
                                         Third, on the other hand, if the Office of Appeals deter-
                                      mined not to sustain the notice of lien or of proposed levy
                                      that was challenged in a CDP hearing, IRS collection per-
                                      sonnel would be free to issue another notice of lien or intent
                                      to levy, as long as the period of limitations for collection, see
                                      sec. 6502, remained open. The subject matter of a CDP
                                      hearing is the particular notice of lien or intent to levy that
                                      the taxpayer challenged under section 6320(a)(3)(B) or
                                      6330(a)(3)(B).
                                         Fourth, the National Taxpayer Advocate or her delegate
                                      can issue a Taxpayer Assistance Order (TAO) requiring the
                                      IRS to ‘‘release property of the taxpayer levied upon’’ or to
                                      ‘‘cease any action, take any action as permitted by law, or
                                      refrain from taking any action’’ with respect to its collection
                                      activities. See sec. 7811(b); 26 C.F.R. sec. 301.7811–1(c),
                                      Proced. & Admin. Regs.; see also IRM pt. 13.1.20.3(1) (Dec.
                                      15, 2007) (‘‘A TAO may be issued for either of two purposes:
                                      A. To direct the OD/Function [to] take a specific action, cease
                                      a specific action, or refrain from taking a specific action; or
                                      B. To direct the IRS to review at a higher level, expedite
                                      consideration of, or reconsider a taxpayer’s case’’).
                                         Fifth, by its nature a collection determination could be
                                      binding only until there has been a change in the taxpayer’s
                                      circumstances. The collection issues that the officer or
                                      employee may address in the agency-level CDP hearing
                                      parent basis for arguing that the Government is bound by the Office of Appeals’ contrary deter-
                                      mination sustaining the lien.
                                        58 See also H. Conf. Rept. 105–599, at 289 (1998), 1998–3 C.B. 747, 1020 (‘‘A taxpayer could

                                      apply for consideration of new information, make an offer-in-compromise, request an installment
                                      agreement, or raise other considerations at any time before, during, or after the Notice of Intent
                                      to Levy hearing’’).




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                                      involve the financial circumstances of the taxpayer that, by
                                      their nature, may change after the hearing. See sec.
                                      6330(d)(2)(B); 26 C.F.R. sec. 301.6330–1(e)(1), Proced. &
                                      Admin. Regs.; Rev. Proc. 2003–71, sec. 4.03, 2003–2 C.B. 517,
                                      518. To decide whether the IRS ought to proceed with collec-
                                      tion, the officer or employee is instructed by agency regula-
                                      tions to request and obtain detailed financial information
                                      about the taxpayer during the hearing, and to make a deter-
                                      mination on the basis of that information. See 26 C.F.R. sec.
                                      301.6330–1(e)(1), Proced. & Admin. Regs. (‘‘Taxpayers will be
                                      expected to provide all relevant information requested by
                                      Appeals, including financial statements, for its consideration
                                      of the facts and issues involved in the hearing’’). However, if
                                      and when a taxpayer later becomes ill or loses a job, or when
                                      a previously ill or unemployed taxpayer is healed or gets a
                                      job, then the position of the tax collector may well change.
                                      This reality is reflected explicitly in section 6330(d)(2)(B),
                                      which contemplates ‘‘a change in circumstances with respect
                                      to such person which affects such determination.’’ Thus, an
                                      appeals officer’s collection judgments reflected in a notice of
                                      determination issued after a CDP hearing are not necessarily
                                      the last word, even for the Office of Appeals itself—nor
                                      should they be. Instead, the Office of Appeals retains juris-
                                      diction to continue to consider collection issues over time.
                                      This flexibility helps to ensure that, on a continuing basis,
                                      the IRS will tailor its collection activities to the taxpayer’s
                                      current circumstances and that the IRS will not take collec-
                                      tion action that is arbitrary or which creates unnecessary
                                      hardship for the taxpayer.
                                         Sixth, if the taxpayer appeals an adverse determination to
                                      the Tax Court, then, as we have noted in part II.C.2 above,
                                      the appeals officer’s collection decisions are reviewed in
                                      litigation. In that context, the determination is of course not
                                      binding on the Tax Court, which reviews for abuse of discre-
                                      tion. More important for evaluating ‘‘finality’’, however, is the
                                      fact that even the IRS as a litigant is not bound by the posi-
                                      tion in the Office of Appeals’ notice of determination. In
                                      defending against that CDP appeal, the IRS (acting through
                                      its attorneys under the Chief Counsel) may re-think the
                                      appeals officer’s collection decisions and may take a posi-
                                      tion—in the litigation or in the settlement of it—that is dif-
                                      ferent from the position reflected in the Office of Appeals’s




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                                      CDP determination. See 26 C.F.R. sec. 601.106(a)(1)(i), (d),
                                      Statement of Procedural Rules; Rev. Proc. 87–24, 1987–1
                                      C.B. 720; General Counsel Order No. 4. (Jan. 19, 2001). It is
                                      the experience of this Court that the Office of Chief Counsel
                                      sometimes does not defend the Office of Appeals’ determina-
                                      tion but rather admits an abuse of discretion and moves the
                                      Court to remand the case to the Office of Appeals for a
                                      supplemental CDP hearing. In those instances the agency’s
                                      position (as taken by Chief Counsel) contradicts the notice of
                                      determination, to which the agency is manifestly not bound.
                                         Consequently, the CDP determination of the Office of
                                      Appeals is not necessarily the agency’s last word on collection
                                      issues.
                                           b. Underlying liability
                                         As we noted above in part II.C.2, a taxpayer who did not
                                      have a previous opportunity to dispute the amount of his
                                      underlying tax liability may raise such a dispute in the
                                      agency-level CDP hearing, pursuant to section 6330(c)(2)(B).
                                      In such a circumstance, the officer or employee conducting
                                      the hearing for the Office of Appeals will determine the IRS’s
                                      position on that taxpayer’s liability. Respondent explains
                                      that, in practice, a settlement officer will conduct the CDP
                                      hearing and will refer the case to an appeals officer to con-
                                      sider the issue of underlying liability. When the appeals
                                      officer makes a determination with respect to the liability
                                      issue, the case is returned to the settlement officer, who
                                      addresses any collection issues and makes an initial deter-
                                      mination that is subsequently approved or overruled by a
                                      team manager, who makes the final determination on behalf
                                      of the Office of Appeals. The settlement officer will not
                                      reconsider the appeals officer’s determination with respect to
                                      the liability issue, and generally, neither will anyone else
                                      within the Office of Appeals.
                                         We noted in Lewis v. Commissioner, 128 T.C. 48, 59 (2007)
                                      (quoting 26 C.F.R. sec. 601.106(a)(1)(ii), Statement of Proce-
                                      dural Rules), that ‘‘[t]he Appeals officer has the ‘exclusive
                                      and final authority’ to determine the liability.’’ 59 On the
                                        59 This provision in the regulations does not actually create ‘‘exclusive and final authority’’ but

                                      rather presumes such authority on the part of ‘‘the regional commissioner’’ and then provides
                                      that Appeals personnel ‘‘represent’’ the regional commissioner in that authority. It is a provision
                                      generally applicable when the Office of Appeals has jurisdiction over a determination of liability.




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                                      other hand, it is clear that such determinations are not
                                      absolutely ‘‘final’’. See Jackson v. Commissioner, T.C. Memo.
                                      1988–143 (‘‘Determinations by the Commissioner are not
                                      judicial in nature, but rather are administrative determina-
                                      tions, and are not res judicata to bind him for subsequent
                                      years, or for that matter, the same taxable year’’); 1B J.
                                      Moore, Moore’s Federal Practice, par. 0.422[2], at 3403 (2d
                                      ed. 1974) (‘‘It is axiomatic to the doctrines of res judicata and
                                      collateral estoppel that only judicial decisions are given
                                      conclusive force in subsequent legal proceedings. Thus deter-
                                      minations made by the Commissioner of Internal Revenue
                                      are not judicial in nature but administrative and are not res
                                      judicata to bind him for the same taxable year or for subse-
                                      quent years’’). We must therefore discern the sense in which
                                      the CDP determination of underlying liability may be said to
                                      be ‘‘final’’.
                                           i. If the liability determination is favorable to the taxpayer
                                         If the liability determination made by the Office of Appeals
                                      in the CDP context is favorable to the taxpayer, then the CDP
                                      process generally ends with a unilateral agency determina-
                                      tion not to proceed with collection. 60 Although the team
                                      manager in charge of the case has the authority to execute
                                      a closing agreement with the taxpayer under section 7121,
                                      see IRS Deleg. Order 97 (Rev. 34), IRM pt. 1.2.47.6 (Aug. 18,
                                      1997), generally no closing agreement is executed, and no
                                      litigation ensues. Respondent states that, as with a liability
                                      determination in a notice of deficiency, ‘‘an underlying
                                      It does apply when underlying liability is properly at issue in the CDP context, but its most
                                      frequent application must be in the non-CDP cases that come to the Office of Appeals for a defi-
                                      ciency determination. If the delegated authority to make the IRS’s ‘‘exclusive and final’’ deter-
                                      mination of a taxpayer’s liability caused the Office of Appeals personnel to be ‘‘inferior Officers’’,
                                      then it would pose questions about the necessity of appointing even the Appeals personnel who
                                      handle non-CDP matters and the regional commissioners who possess this authority in the first
                                      instance and from whom the Office of Appeals receives this authority only derivatively.
                                        60 If a taxpayer in a CDP hearing proposes not a complete concession by the IRS but an offer-

                                      in-compromise (OIC) based on doubt as to liability, and if the Office of Appeals accepts the OIC,
                                      then the resulting agreement is binding on the IRS. However, that binding effect is not unique
                                      to the CDP process; rather, the OIC accepted in the CDP context has the same effect (no more,
                                      and no less) as an OIC accepted in any context. In the absence of an OIC or a closing agree-
                                      ment, the non-liability determination is simply reflected in the notice of determination, see IRM
                                      pt. 8.22.3.9(1) (Oct. 19, 2007) (‘‘Abatement of Tax’’), and then is effectuated either by Office of
                                      Appeals personnel directly, see IRM pt. 8.22.3.9.3.1 (Oct. 19, 2007) (‘‘APS [Appeals Processing
                                      Services] will input adjustments to tax’’), 8.22.3.9.3.1.1(2) (Oct. 19, 2007) (‘‘APS will abate the
                                      SFR/ASFR assessment and reverse withholding as requested by the hearing officer’’), or by col-
                                      lection personnel, see IRM pt. 5.1.9.3.10(6) (Dec. 15, 2003), 5.19.8.4.9(2) (Nov. 1, 2007),
                                      5.19.8.4.14(1) (Nov. 1, 2007) (‘‘CDP ‘back-end’ work’’).




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                                      liability determination in a CDP case is also binding on the
                                      Examination function. The Examination function generally
                                      has no opportunity to review Appeals’ determination’’; and
                                      we assume arguendo that this is correct. 61 However, this
                                      binding character is limited.
                                         First, if it is true (as section 6330(d)(2) provides) that the
                                      Office of Appeals ‘‘shall retain jurisdiction with respect to
                                      any determination’’ (emphasis added), then it would seem
                                      that the Office of Appeals itself must have jurisdiction to
                                      reconsider its pro-taxpayer liability determination.
                                         Second, if the taxpayer had paid all or part of the liability
                                      that had been at issue in a CDP hearing and thereafter
                                      sought a refund of it through litigation, no collateral estoppel
                                      or res judicata effect to govern the outcome of the refund suit
                                      would arise from the prior CDP determination. See Jackson
                                      v. Commissioner, supra. The case would be defended not by
                                      the IRS but by attorneys of the Department of Justice, see 28
                                      U.S.C. sec. 516 (2006), 62 which also has settlement authority
                                      in such cases, see sec. 7122. 63 But even in refund suits han-
                                      dled by the Department of Justice the IRS must request any
                                      counterclaim, see sec. 7403, must give a defense rec-
                                      ommendation, see 28 U.S.C. sec. 520 (2006), and must give
                                      its views on proposed settlements. 64 In that context, it is the
                                      Office of Chief Counsel, and not the Office of Appeals, that
                                      speaks for the IRS; and Chief Counsel is not bound by the
                                      appeals officer’s CDP determination. IRM pt. 34.8.2.11.5(4)
                                         61 It is not clear why Examination would necessarily be bound by the CDP determination of

                                      a liability issue. A liability determination in a notice of deficiency (whether issued by the Office
                                      of Appeals or another IRS function) may acquire a quasi-binding character within the agency
                                      because section 6212(c) restricts the determination of further deficiencies (though section
                                      6214(a) permits an increased deficiency if the matter is challenged in the Tax Court); but the
                                      CDP determination may arise in the absence of a notice of deficiency (as when a taxpayer dis-
                                      putes tax assessed pursuant to his own return) and does not result in the issuance of a notice
                                      of deficiency—so that section 6212(c) is not implicated. Amicus observes that the point has not
                                      been litigated but concludes that the liability determination in a CDP hearing is probably not
                                      binding elsewhere, citing Botany Worsted Mills v. United States, 278 U.S. 282, 289 (1929).
                                         62 By regulation, 28 C.F.R. sec. 0.15 (2007), it is the Deputy Attorney General (not one of the

                                      ‘‘Heads of Departments’’, in Appointments Clause parlance) who hires Department of Justice
                                      trial attorneys.
                                         63 An Assistant Attorney General heads the Tax Division and hires the Chiefs of the litigating

                                      sections in the Tax Division. See Memorandum of Dec. 29, 1999, to Heads of Department Com-
                                      ponents from then-Deputy Attorney General Eric Holder, available at http://www.usdoj.gov/jmd/
                                      ps/sesdelegmemo.htm. Settlement authority is delegated to those Chiefs. See Tax Division Direc-
                                      tive No. 135, reprinted in 28 C.F.R. pt. O, subpt. Y, app.
                                         64 See id. (delegating settlement authority only in cases in which the agency agrees, and there-

                                      by requiring solicitation of IRS views to settle tax cases); see also ‘‘Department of Justice Tax
                                      Division Settlement Reference Manual’’, at 5–6, 16, available at http://www.usdoj.gov/tax/
                                      readingroom/foia/tax.htm.




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                                      (Aug. 11, 2004). The Government might therefore resist the
                                      refund claim—and might even plead a counterclaim—by
                                      asserting liabilities that the Office of Appeals did not sus-
                                      tain, taking its cue not from the Office of Appeals but from
                                      the Office of Chief Counsel, which must be independent and
                                      impartial. 65
                                         Thus, a pro-taxpayer CDP determination on underlying
                                      liability has at most a limited ‘‘finality’’ within the agency.
                                           ii. If the liability determination is not favorable to the
                                               taxpayer
                                         If the liability determination made by the Office of Appeals
                                      in the CDP context is not favorable to the taxpayer, then
                                      there are several contexts in which the IRS may take a posi-
                                      tion different from that reflected in the CDP determination.
                                           (A). CDP litigation
                                         The taxpayer may appeal the adverse CDP liability deter-
                                      mination to the Tax Court, pursuant to section 6330(d). If
                                      the taxpayer does appeal, then the Tax Court reviews the
                                      liability issues de novo. Davis v. Commissioner, 115 T.C. at
                                      39. In Tax Court proceedings the IRS is represented by the
                                      Office of Chief Counsel, see sec. 7452, which may re-think
                                      the liability issues and may take a position different from
                                      that reflected in the notice of determination. See IRM pt.
                                      1.1.6.1 (quoted supra note 65). In addition, the Office of Chief
                                      Counsel—not the Office of Appeals—has the authority to
                                      settle CDP cases that reach litigation, see sec. 601.106(a)(2)(i),
                                      Statement of Procedural Rules; Rev. Proc. 87–24, 1987–1
                                      C.B. 720, and it has the authority to settle CDP cases without
                                      the concurrence of the Office of Appeals, see Rev. Proc. 87–
                                      24, supra; IRM pt. 35.5.1.4.3(2), 35.5.2.7(2), 35.5.2.14(2)(B)
                                      (Aug. 11, 2004).
                                         If the taxpayer who receives an adverse notice of deter-
                                      mination reflecting the officer’s or employee’s decision about
                                      underlying liability decides not to appeal to the Tax Court,
                                      then the IRS may nonetheless meet this taxpayer again in a
                                         65 See IRM pt. 1.1.6.1 (July 29, 2005) (‘‘Counsel must interpret the law with complete impar-

                                      tiality so that the American * * * [public] will have confidence that the tax law is being applied
                                      with integrity and fairness.’’).




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                                      variety of other circumstances in which, again, the                                            CDP
                                      liability determination will not be binding on the IRS:
                                           (B). Audit reconsideration
                                        Audit reconsideration is a substantive review of the tax-
                                      payer’s liability that may result in the abatement of an
                                      assessed tax liability. Specifically, audit reconsideration ‘‘is
                                      the process the IRS uses to reevaluate the results of a prior
                                      audit where additional tax was assessed and remains unpaid,
                                      or a tax credit was reversed.’’ IRM pt. 4.13.1.2 (Oct. 1, 2006).
                                      The IRS’s authority to conduct an audit reconsideration is
                                      grounded in section 6404(a), which provides that ‘‘[t]he Sec-
                                      retary is authorized to abate the unpaid portion of the
                                      assessment of any tax or any liability in respect thereof,
                                      which—(1) is excessive in amount, or (2) is assessed after the
                                      expiration of the period of limitations properly applicable
                                      thereto, or (3) is erroneously or illegally assessed.’’
                                        Audit reconsideration is not precluded by a prior CDP
                                      determination. See IRM pt. 4.13.1.8 (Oct. 1, 2006) (listing cir-
                                      cumstances in which ‘‘a request for [audit] reconsideration
                                      will not be considered’’; prior CDP hearing is not listed).
                                      Therefore, a taxpayer who has received an adverse CDP
                                      determination with respect to his underlying liability could
                                      nonetheless have his liability redetermined in the course of
                                      an audit reconsideration.
                                           (C). District Court collection suit
                                        If the taxpayer does not pay the tax, the IRS may request
                                      the Department of Justice to file a collection suit against the
                                      taxpayer in Federal District Court. See sec. 7403(a) (‘‘the
                                      Attorney General * * *, at the request of the Secretary, may
                                      direct a civil action to be filed in a district court’’). It is the
                                      Office of Chief Counsel, and not the Office of Appeals, that
                                      decides for the IRS whether to make that request, and the
                                      Chief Counsel is not bound by the appeals officer’s CDP deter-
                                      mination of liability. See General Counsel Order No. 4 (rev.
                                      Jan. 19, 2001).




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                                           (D). Request for abatement, refund claim, and refund
                                                litigation
                                         The taxpayer may request an abatement of tax, or he may
                                      pay the tax and claim a refund. We are aware of no reason
                                      or rule requiring that, when the IRS then considers adminis-
                                      tratively that request for abatement or claim for refund, it is
                                      bound by the appeals officer’s adverse CDP determination. If
                                      the IRS denies a refund claim, the taxpayer may file a refund
                                      suit in Federal District Court or the Court of Federal Claims.
                                      As we noted above, the IRS will be asked for its defense rec-
                                      ommendation and for its views on proposed settlements. In
                                      that context, it will be the Office of Chief Counsel, and not
                                      the Office of Appeals, that will speak for the IRS, and the
                                      Chief Counsel will not be bound by the appeals officer’s CDP
                                      determination. See supra part II.C.3.b.i.
                                         In sum, the collection and liability determinations made in
                                      CDP hearings by officers and employees of the Office of
                                      Appeals are an important aspect of the agency’s administra-
                                      tion of the tax law, and they affect to a greater or lesser
                                      extent the agency’s ultimate position with regard to the tax
                                      liability and the collection of it. But there are numerous cir-
                                      cumstances in which those determinations may not be the
                                      IRS’s last word.

                                           4. The tax administration context of the CDP ‘‘officer or
                                              employee’’
                                         The IRS personnel who are appointed by the President or
                                      the Secretary of the Treasury are the Commissioner, see sec.
                                      7803(a)(1), the Chief Counsel, see sec. 7803(b)(1), members of
                                      the Internal Revenue Service Oversight Board, see sec.
                                      7802(b)(1), and the National Taxpayer Advocate, see sec.
                                      7803(c)(1). See also supra note 47. Personnel to fill other
                                      positions in the IRS are hired by the Commissioner pursuant
                                      to section 7804(a).
                                         These hired, non-appointed positions include (i) the Deputy
                                      Commissioner for Services and Enforcement, who is dele-
                                      gated the authority to oversee the four primary operating
                                      divisions of the IRS, see IRM pt. 1.1.5.3 (Oct. 28, 2008); (ii) the
                                      Deputy Commissioner for Operations Support, who is dele-
                                      gated the authority to oversee the integrated support func-
                                      tions of the IRS, see IRM pt. 1.1.5.4 (Oct. 28, 2008); (iii) the




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                                      Commissioners of the Wage and Investment Division, the
                                      Small Business/Self-Employed Division, the Tax-Exempt and
                                      Government Entities Division, and the Large and Mid-Size
                                      Business Division, who are delegated the authority to super-
                                      vise and manage those divisions, see IRM pt. 1.1.13.1 (Sept.
                                      1, 2005), 1.1.16.1 (Mar. 1, 2007), 1.1.23.2 (Feb. 1, 2007),
                                      1.1.24.1 (Nov. 1, 2006); (iv) the Deputy Chief Counsel (Tech-
                                      nical), who serves as the principal deputy to the Chief
                                      Counsel, acts as Chief Counsel when that office is vacant,
                                      maintains jurisdiction over legal issues arising in published
                                      guidance, letter rulings, technical advice, and other proc-
                                      esses, and participates in the interpretation and development
                                      of internal revenue laws, see IRM pt. 1.1.6.2 (Dec. 16, 2009),
                                      (v) the Deputy Chief Counsel (Operations), who maintains
                                      jurisdiction over issues arising in litigation nationwide and
                                      participates in the formulation of tax litigation policy, see
                                      IRM pt. 1.1.6.3 (Dec. 16, 2009), and (vi) the Chief of the Office
                                      of Appeals, who is delegated the authority to plan, manage,
                                      direct, and execute the nationwide activities of that office,
                                      see IRM pt. 1.1.7.1 (Feb. 5, 2008). 66
                                        Lower in the IRS hierarchy, these hired positions include
                                      revenue officers (at or above the rank of GS–9 67), who are
                                      delegated the authority (i) to issue, serve, and enforce sum-
                                      monses, to set the time and place for appearance, to take
                                      testimony under oath of the person summoned, and to
                                      receive and examine data produced in compliance with the
                                      summons, see IRS Deleg. Order 25–1 (formerly IRS Deleg.
                                      Order 4 (Rev. 23), 55 Fed. Reg. 7626); (ii) to issue notices of
                                      levy, see IRS Deleg. Order 5–3 (Rev. 1), IRM pt. 1.2.44.3 (Nov.
                                      8, 2007); and (iii) to issue notices of Federal tax lien, see
                                      Delegation Order 5–4 (Rev. 1), IRM pt. 1.2.44.4 (Sept. 23,
                                      2005). That is, revenue officers have the power—unless the
                                      CDP process intervenes—to effect the actual collection of tax.



                                        66 Justice Breyer would evidently characterize many of these personnel as ‘‘officers’’. See Free

                                      Enter. Fund v. PCAOB, 561 U.S. at ll 130 S. Ct. at 3180 (Breyer, J., dissenting) (‘‘by virtually
                                      any definition, essentially all SES [Senior Executive Service] officials qualify as ‘inferior officers,’
                                      for their duties, as defined by statute, require them to ‘direc[t] the work of an organizational
                                      unit,’ carry out high-level managerial functions, or ‘otherwise exercis[e] important policy-making,
                                      policy-determining, or other executive functions.’ §3132(a)(2) (emphasis added)’’).
                                        67 The General Schedule, abbreviated ‘‘GS’’, is the basic pay schedule for employees of the Fed-

                                      eral Government. See 5 U.S.C. sec. 5332 (2006).




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                                           5. The administrative law context of the CDP ‘‘officer or
                                              employee’’
                                         Today the Federal Government employs a corps of about
                                      5,000 hearing officers who adjudicate cases for dozens of its
                                      agencies. Raymond Limon, Office of Admin. Law Judges,
                                      Office of Pers. Mgmt., ‘‘The Federal Administrative Judiciary,
                                      Then and Now, A Decade of Change 1992–2002’’, at 3 (Dec.
                                      23, 2002). Fewer than a third of those positions are classified
                                      as administrative law judges (ALJs) under the Administrative
                                      Procedure Act (APA), and the remainder of those positions are
                                      commonly referred to as non-ALJ hearing officers. 68 Over 80
                                      percent of ALJs are currently employed by the Social Security
                                      Administration (SSA). OPM Report (showing the SSA employed
                                      1,128 of 1,388 ALJs in June 2008). None of the SSA’s ALJs are
                                      appointed by the Commissioner of the SSA, who serves as the
                                      department head. See Soc. Sec. Admin., ODAR Redelegations
                                      of Personnel and Equal Employment Opportunity Authorities
                                      (September 2006). Instead, the authority to appoint ALJs for
                                      the SSA is delegated to the Deputy Commissioner for the
                                      Office of Disability Adjudication and Review of the SSA. Id.
                                      Therefore, the great majority of ALJs are not appointed
                                      pursuant to the Appointments Clause.
                                         ALJs are hired pursuant to 5 U.S.C. sec. 3105 (2006). An
                                      agency may appoint an individual as an ALJ only after the
                                      Office of Personnel Management certifies that individual as
                                      eligible for the position. 5 C.F.R. sec. 930.204 (2008). The APA
                                      generally requires that an ALJ preside over ‘‘every case of
                                      adjudication required by statute to be determined on the
                                      record after opportunity for an agency hearing’’. 5 U.S.C. sec.
                                      554 (2006). If the adjudication is a so-called on the record
                                      hearing, then the hearing is a ‘‘formal adjudication’’ that
                                      must adhere to the formal hearing procedures of the APA,
                                      which provide, inter alia, that each party is entitled to
                                      present oral or documentary evidence, submit rebuttal evi-
                                      dence, and conduct cross-examination. 5 U.S.C. secs. 554–
                                      557. When presiding over an ‘‘on the record’’ hearing, ALJs
                                        68 Id. at 1–4 (showing that the Federal Government employed 1,351 ALJs and 3,370 non-ALJ

                                      hearing officers in 2002); see also Office of Pers. Mgmt., Federal Administrative Law Judges,
                                      By Agency and Level, CDPF Status Report as of June 2008 (OPM Report) (showing the Federal
                                      Government employed 1,388 ALJs in June 2008). Justice Breyer determined that there are cur-
                                      rently 1,584 ALJs. See Free Enter. Fund v. PCAOB, 561 U.S. at ll, 130 S. Ct. at 3180–3181
                                      (Breyer, J., dissenting).




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                                      have the authority to require attendance at the hearing, to
                                      administer oaths and affirmations, to issue subpoenas, to
                                      rule on offers of proof and receive evidence, and to order
                                      depositions. Id.
                                         However, if the relevant statute does not require an ‘‘on
                                      the record’’ hearing, then the formal hearing procedures of
                                      the APA do not apply and a non-ALJ hearing officer may pre-
                                      side over the adjudication. See id. Sections 6320 and 6330 do
                                      not require an ‘‘on the record’’ CDP hearing, see Davis v.
                                      Commissioner, 115 T.C. at 41–42 (citing 26 C.F.R. sec.
                                      601.106(c), Statement of Procedural Rules); and thus even
                                      apart from section 6330(b)(3) (allowing a CDP hearing before
                                      ‘‘an officer or employee’’), APA procedures would not require
                                      the IRS to use ALJs to conduct CDP hearings. Therefore, the
                                      appeals officer who conducts and adjudicates a CDP hearing
                                      is more comparable to a non-ALJ hearing officer than to an
                                      ALJ.
                                         The CDP hearing officer, hired and not constitutionally
                                      ‘‘appointed’’, is by no means unique in the context of adminis-
                                      trative adjudication.
                                      III. The status of the CDP ‘‘officer or employee’’ and ‘‘appeals
                                           officer’’ under the Appointments Clause
                                        In order to determine whether the ‘‘officer or employee’’ (or
                                      the ‘‘appeals officer’’) of section 6330 is an ‘‘inferior Officer’’
                                      who must be appointed in compliance with the Appointments
                                      Clause, we consider the two issues prompted by the text of
                                      the clause.
                                           A. Whether the position is ‘‘established by Law’’
                                        ‘‘[T]he threshold trigger for the Appointments Clause’’ is
                                      that an office be ‘‘ ‘established by Law’ ’’. Landry v. FDIC, 204
                                      F.3d at 1133. We hold that there is no CDP hearing officer
                                      position ‘‘established by Law’’ under sections 6320 and 6330
                                      whose incumbent could be an officer subject to the Appoint-
                                      ments Clause.
                                           1. Creation by statute
                                        Where ‘‘the ‘duties, salary, and means of appointment’ for
                                      the office were specified by statute’’, that is considered ‘‘a
                                      factor that has proved relevant in the [Supreme] Court’s




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                                      Appointments Clause jurisprudence.’’ Id. (quoting Freytag v.
                                      Commissioner, 501 U.S. at 881). If there were a statutory
                                      provision to the effect that ‘‘There shall be, within the
                                      Internal Revenue Service Office of Appeals, officers des-
                                      ignated as Appeals Officers, who shall conduct CDP hearings’’,
                                      etc., then that would be some indication that the Appeals
                                      Officer position was ‘‘established by Law’’. There is no such
                                      statute, and this lack is some indication that the position in
                                      question is not an office ‘‘established by Law’’.
                                         The IRS Office of Appeals was not, in its current form, ini-
                                      tially created by the Internal Revenue Code, 69 nor were its
                                      ‘‘Appeals Officers’’. Congress did explicitly ‘‘establish’’ in the
                                      Internal Revenue Code certain officers who are to be
                                      appointed by the President, with the advice and consent of
                                      the Senate—i.e., the Commissioner, sec. 7803(a)(1), the Chief
                                      Counsel, sec. 7803(b)(1), and members of the Internal Rev-
                                      enue Service Oversight Board, sec. 7802(b)(1)—and the
                                      National Taxpayer Advocate (sec. 7803(c)(1)), who is
                                      appointed by the Secretary of the Treasury. 70 Otherwise, the
                                      employment of ‘‘Other Personnel’’ is authorized in Section
                                      7804(a), which, as we noted above, simply provides that ‘‘the
                                      Commissioner of Internal Revenue is authorized to employ
                                      such number of persons as the Commissioner deems proper’’.
                                      Congress thus left to the Executive Branch almost the entire
                                      personnel structure of the IRS and refrained from estab-
                                      lishing other particular offices within it.
                                         As is shown above in part II.B, it was the Executive
                                      Branch that created the IRS Office of Appeals and its per-
                                      sonnel structure, pursuant to that authority in section
                                      7804(a). When Congress enacted in 1998 the CDP provisions
                                      in sections 6320 and 6330, it employed that pre-existing
                                      Office of Appeals and committed the new CDP function to that
                                      office. Secs. 6320(b)(1), 6330(b)(1), (d)(2). Mr. Tucker con-
                                      tends that the RRA established the pre-existing Appeals
                                      Officer position as the CDP hearing officer. The statute does
                                        69 Although the Office of Appeals was originally a creature of regulation, the multiple ref-

                                      erences to it that were added to the Code in 1998, see part II.B above, make it at least arguable
                                      that the Office of Appeals is now required by statute. However, there is no constitutional issue
                                      as to whether the Office of Appeals itself was ‘‘establish[ed] by Law’’; rather, the issue is wheth-
                                      er there are, within the Office of Appeals, personnel who are ‘‘officers’’ whose positions are ‘‘es-
                                      tablished by Law’’.
                                        70 The National Taxpayer Advocate’s predecessor, the Taxpayer Advocate, was appointed by

                                      the Commissioner of Internal Revenue, pursuant to former section 7802(d)(1).




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                                      refer to an ‘‘appeals officer’’ as the person who ‘‘obtain[s]
                                      verification * * * that the requirements of any applicable
                                      law or administrative procedure have been met’’, sec.
                                      6330(c)(1), and who makes the ‘‘determination’’ whether to
                                      proceed with collection, sec. 6330(c)(3). However, for the fol-
                                      lowing reasons we conclude that section 6330 uses the term
                                      ‘‘appeals officer’’ interchangeably with the term ‘‘officer or
                                      employee’’:
                                         First, the provisions in the lien statute, section 6320(b)(3),
                                      and in the levy statute, section 6330(b)(3), that actually state
                                      who shall conduct the hearing state that ‘‘the hearing * * *
                                      shall be conducted by an officer or employee who has had no
                                      prior involvement with respect to the unpaid tax’’. (Emphasis
                                      added.) This is the first and only mention of an individual in
                                      the lien statute and the first mention of an individual in the
                                      levy statute. The caption of each paragraph is ‘‘Impartial
                                      officer’’, thereby explicitly indicating that it might be an
                                      ‘‘officer or employee’’ who serves as the ‘‘Impartial officer’’.
                                      (Emphasis added.) This shows that Congress did not use the
                                      term ‘‘officer’’ in any specialized sense. The phrase ‘‘or
                                      employee’’ is so contrary to Mr. Tucker’s position that he is
                                      forced to declare the phrase ‘‘mere surplusage’’. However, we
                                      decline to read words out of the statute; rather, we attempt
                                      to give meaning to every word that Congress enacted, and
                                      here that is best accomplished by taking at face value the
                                      phrase ‘‘officer or employee’’ in sections 6320(b)(3) and
                                      6330(b)(3) (emphasis added), and by understanding the
                                      phrase ‘‘appeals officer’’ in section 6330(c)(1) and (3) as short-
                                      hand for an officer or employee in the Office of Appeals. If
                                      Congress had intended to assign CDP duty to a particular
                                      rank of ‘‘Appeals Officer’’, it would not have added the phrase
                                      ‘‘or employee’’; and it could have used language like that
                                      which it used simultaneously in RRA section 3105 where it
                                      provided that a bond issuer could appeal an adverse ruling
                                      ‘‘to a senior officer of the Internal Revenue Service Office of
                                      Appeals’’. (Emphasis added.)
                                         Second, the conference report describing the provision does
                                      on one occasion use the designation ‘‘appeals officer’’ but
                                      almost immediately thereafter uses the designation ‘‘appel-




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                                      late officer’’. H. Conf. Rept. 105–599, at 264 (1998), 1998–3
                                      C.B. 747, 1018 (emphasis added). 71
                                         Neither the statute itself nor the legislative history shows
                                      that Congress intended to ascribe any particular importance
                                      or significance to the term ‘‘appeals officer’’. We hold that, for
                                      purposes of section 6330(c)(1) and (3), an ‘‘appeals officer’’ is
                                      any ‘‘officer or employee’’ in the IRS Office of Appeals to
                                      whom is assigned the task of conducting a CDP hearing under
                                      section 6330(b)(3). 72
                                         The statute thus does not create any positions for the per-
                                      sonnel who would perform the CDP function but rather refers
                                      to them in a most diffuse manner (‘‘conducted by an officer
                                      or employee’’). After the enactment of this statute, it was not
                                      possible to point to a position responsible for conducting CDP
                                      hearings and to question whether the person in that position
                                      was an ‘‘inferior Officer’’; instead the hearings would be con-
                                      ducted by ‘‘employees’’ yet to be designated, from time to
                                      time, within the Office of Appeals. 73 Thus, the mere mention
                                      of an ‘‘officer or employee’’ or an ‘‘appeals officer’’ in sections
                                      6320 and 6330 presumes but does not establish any posi-
                                      tion. 74 In addition to sections 6320 and 6330, however, Mr.
                                      Tucker points to a reference to ‘‘appeals officer’’ in a provi-
                                      sion of the RRA that has not been codified in the Code. 75 RRA
                                      section 3465(b), 112 Stat. 768, 1998–3 C.B. 228, provides:
                                      The Commissioner of Internal Revenue shall ensure that an appeals officer
                                      is regularly available in each State. [Emphasis added.]

                                         71 See also S. Rept. 105–174, at 68 (1998), 1998–3 C.B. 537, 604 (‘‘The determination of the

                                      appeals officer’’; ‘‘the determination of the appellate officer’’; ‘‘the appellate officer’s determina-
                                      tion’’ (emphasis added)).
                                         72 See Powers v. Commissioner, T.C. Memo. 2009–229; Reynolds v. Commissioner, T.C. Memo.

                                      2006–192.
                                         73 Mr. Tucker sets out an elaborate hypothetical circumstance, intended to show the impor-

                                      tance of appeals officers, in which an appeals officer could end up holding jurisdiction over the
                                      three major U.S. car manufacturers and thereby ‘‘effectively become the United States ‘Car
                                      Czar’ ’’; ‘‘she could effectively end the United States domestic automobile industry’’; ‘‘She could
                                      be in charge of the companies’ fates for years’’. Among the reasons that we are not influenced
                                      by this possibility is that it is the Office of Appeals, and not an individual officer or employee,
                                      that retains jurisdiction under section 6330(d)(2).
                                         74 The mere mention of an office in the Code evidently does not establish that office or guar-

                                      antee its continuance. Other administratively created IRS positions have been mentioned from
                                      time to time in sections of the Code but have thereafter been abolished by agency restructuring
                                      and their functions delegated to other personnel. See, e.g., sec. 6334(e)(2)(A) (mentioning ‘‘dis-
                                      trict director’’); sec. 7611(b)(3)(C) (mentioning ‘‘regional commissioner’’).
                                         75 For the two other uncodified references to ‘‘appeals officers’’ in the RRA, see supra note 52.




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                                      This provision, however, has little to do with the CDP hearing
                                      or its presiding ‘‘officer or employee’’. (Emphasis added.) The
                                      statute certainly does not establish (or even imply) a CDP
                                      hearing officer ‘‘in each State’’. That is, even if the statute
                                      were read to mean that ‘‘There shall be, and is hereby estab-
                                      lished, an IRS official known as ‘Appeals Officer’ in each
                                      State’’, Congress would not, by creating such an official,
                                      establish a CDP hearing officer, as Mr. Tucker’s argument
                                      would require. Whatever that ‘‘appeals officer * * * in each
                                      state’’ might be tasked with doing, Congress made clear in
                                      sections 6320(b)(3) and 6330(b)(3) that a CDP hearing can be
                                      staffed by an ‘‘officer or employee’’. (Emphasis added.)
                                         We therefore hold that the RRA did not establish the posi-
                                      tion of a CDP ‘‘appeals officer’’.
                                           2. Creation by regulation
                                        However, Mr. Tucker contends, in effect, that proper
                                      Appointments Clause analysis must consider both statute
                                      and regulations. We therefore consider whether an office
                                      might be ‘‘established’’ by the RRA taken together with the
                                      regime for the Office of Appeals that is established in the
                                      regulations. It is true that the case law does not posit a
                                      bright-line rule that would require an explicit statutory cre-
                                      ation of an office before there can be an ‘‘officer’’ for purposes
                                      of the Appointments Clause. Opinions of the Courts of
                                      Appeals for the Third, Fifth, and Sixth Circuits seem to tend
                                      to the contrary: 76
                                        The Administrative Review Board (ARB) of the Department
                                      of Labor, composed of three ‘‘members’’ appointed by the Sec-
                                      retary of Labor, ‘‘ ‘issu[es] final agency decisions on questions
                                      of law and fact arising in review or on appeal’ in whistle-
                                      blower cases.’’ Willy v. Admin. Review Bd., 423 F.3d 483, 491
                                      (5th Cir. 2005) (quoting 61 Fed. Reg. 19978 (May 3, 1996)).
                                      The ARB was created not by statute but by an order of the
                                      Secretary of Labor, pursuant to 5 U.S.C. sec. 301 (2006),
                                      which provides that ‘‘[t]he head of an Executive department
                                         76 In Free Enter. Fund v. PCAOB, 561 U.S. at ll, 130 S. Ct. at 3179 (Breyer, J., dissenting),

                                      Justice Breyer asserts explicitly that an ‘‘office’’ can be ‘‘created either by ‘regulations’ or by
                                      ‘statute,’ ’’ for which he cites United States v. Mouat, 124 U.S. 303, 307–308 (1888) (‘‘there is
                                      no statute authorizing the secretary of the navy to appoint a pay-master’s clerk, nor is there
                                      any act requiring his approval of such an appointment, and the regulations of the navy do not
                                      seem to require any such appointment or approval for the holding of that position. The claimant,
                                      therefore, was not an officer’’ (emphasis added)).




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                                      * * * may prescribe regulations for the government of his
                                      department, the conduct of its employees, [and] the distribu-
                                      tion and performance of its business’’. Both the Courts of
                                      Appeals for the Fifth Circuit, see Willy v. Admin. Review Bd.,
                                      423 F.3d at 491–492, and the Sixth Circuit, see Holtzclaw v.
                                      Sec. of Labor, 172 F.3d 872 (6th Cir. 1999); Varnadore v. Sec.
                                      of Labor, 141 F.3d 625, 631 (6th Cir. 1998), approved the cre-
                                      ation of the ARB as being within the general authority
                                      granted to the Secretary of Labor under 5 U.S.C. sec. 301
                                      (2006), analyzed the position of member on the ARB under
                                      the Appointments Clause and found it to be an ‘‘inferior
                                      Officer’’, and held that Congress, by 5 U.S.C. sec. 301, had
                                      authorized the Secretary to make the appointments, which
                                      satisfied the requirements of the Appointments Clause.
                                         Similarly, the Appeals Board of the Department of Health
                                      and Human Services (HHS), composed of members appointed
                                      by the Secretary of HHS, resolves disputes under the Child
                                      Support Enforcement Act, 42 U.S.C. secs. 651–669(b) (2006).
                                      Pennsylvania v. HHS, 80 F.3d 796, 800 (3d Cir. 1996). The
                                      Appeals Board was created not by statute but by regulation,
                                      45 C.F.R. pt. 16 (1981), promulgated by the Secretary of HHS,
                                      pursuant to 42 U.S.C. sec. 913 (2006), which provides: ‘‘The
                                      Secretary is authorized to appoint and fix the compensation
                                      of such officers and employees, and to make such expendi-
                                      tures as may be necessary for carrying out the functions of
                                      the Secretary under this chapter.’’ The Court of Appeals for
                                      the Third Circuit approved the creation of the Appeals Board
                                      as being within the general authority granted to the Sec-
                                      retary of HHS under 42 U.S.C. sec. 913, analyzed the position
                                      of member on the Appeals Board under the Appointments
                                      Clause and found it to be an ‘‘inferior Officer’’, and held that
                                      Congress, by 42 U.S.C. sec. 913, had authorized the Sec-
                                      retary to make the appointments, which satisfied the
                                      requirements of the Appointments Clause. Pennsylvania v.
                                      HHS, supra at 804–805.
                                         None of these opinions suggests that any party had argued
                                      that the positions under review were not ‘‘established by
                                      Law’’. Rather, the parties and the courts seem to have
                                      assumed that if the positions existed, then the positions were




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                                      ‘‘established by Law’’. 77 If this assumption is correct, then it
                                      would seem that any ‘‘Office’’ that actually exists in the Fed-
                                      eral Government is arguably ‘‘established by Law’’.
                                         The Supreme Court has not so held, and the assumption
                                      is problematic, in that it risks reading out of the Constitution
                                      the phrase ‘‘established by Law’’, if the Appointments Clause
                                      would mean the same thing with or without that phrase. One
                                      could argue instead that only a position created by a statute
                                      can be ‘‘established by Law’’ for purposes of the Appoint-
                                      ments Clause. If a position is created not by Congress but by
                                      the Executive, then by definition there is no possibility that
                                      Congress both created and filled that position, which is the
                                      chief danger against which the clause is a safeguard.
                                         However, if the phrase ‘‘established by Law’’ were con-
                                      strued to mean that the Appointments Clause can apply only
                                      to a position expressly created by a statute, then abuses
                                      could arise. For example, Congress could take a pre-existing
                                      low-level position (which had been created by the Executive
                                      Branch pursuant to a general authorization like section
                                      7804(a), and which was not subject to appointment by the
                                      President or a Head of a Department) and could invest it
                                      with significant additional power, thus evading the Appoint-
                                      ments Clause by seeming to avoid ‘‘establishing’’ the office. 78
                                      Where such a pattern existed, the courts would have to see
                                      through the subterfuge and enforce the Appointments
                                      Clause. Mr. Tucker argues that the CDP provisions involve
                                      just this problem—i.e., that Congress took the existing
                                      Appeals Officer position and invested it with the ‘‘significant
                                      authority’’ (discussed below in part II.B.2) of the CDP process.
                                         The argument fails, however, because Congress has
                                      assigned the CDP hearing function not to a particular rank or
                                      title of ‘‘Appeals Officer’’ nor to any other identifiable office-
                                      holder but generally to the Office of Appeals and, within it,
                                      to any ‘‘officer or employee’’, secs. 6320(b)(3), 6330(b)(3), from
                                      among the ‘‘number of persons’’ who are employed in that
                                         77 For a defense of this position, see Stephen G. Bradbury, ‘‘Officers of the United States With-

                                      in the Meaning of the Appointments Clause’’, 31 Op. Off. Legal Counsel, at *36–38, 2007 OLC
                                      LEXIS 3, *117–123 (Apr. 16, 2007).
                                         78 An analogous abuse via ‘‘indirection’’ was hypothesized in Springer v. Govt. of the Philippine

                                      Islands, 277 U.S. 189, 202 (1928), when the Court stated: ‘‘the legislature cannot ingraft execu-
                                      tive duties upon a legislative office, since that would be to usurp the power of appointment by
                                      indirection’’. The Court did go on to observe that ‘‘the case might be different if the additional
                                      duties were devolved upon an appointee of the executive’’, id., but it did not elaborate on this
                                      scenario.




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                                      Office ‘‘as the Commissioner deems proper for the adminis-
                                      tration and enforcement of the internal revenue laws’’, sec.
                                      7804(a). Likewise, even under the regulations the CDP
                                      responsibility does not inhere in any specific office or posi-
                                      tion. Pursuant to the administrative arrangements of the
                                      Office of Appeals, 250 employees are designated to perform
                                      that CDP function, but it is within the agency’s authority
                                      under section 6330 to allocate the function as it will among
                                      its 1,100 settlement officers and Appeals Officers. The
                                      Appointments Clause applies only when an office is ‘‘estab-
                                      lished by Law’’, but there is no office established by statute
                                      or regulation to which Congress committed the CDP function.
                                           B. Whether the CDP function could constitute an ‘‘office’’
                                         If, however, a position is ‘‘established by Law’’, the second
                                      question in an Appointments Clause inquiry is whether that
                                      position constitutes an office of the United States. Only
                                      ‘‘offices’’ are subject to the requirements of the clause, and
                                      not every position that is ‘‘established by Law’’ is an office. 79
                                      See Freytag v. Commissioner, 501 U.S. at 880–881. Assuming
                                      arguendo that the CDP function prescribed under sections
                                      6320 and 6330 and the regulations thereunder is committed
                                      to a position ‘‘established by Law’’, we must determine
                                      whether that position could constitute an ‘‘office’’.
                                         The Supreme Court has articulated two essential
                                      characteristics that a position must have in order to con-
                                      stitute an office: A position is an office if (i) it is invested
                                      with ‘‘significant authority pursuant to the laws of the
                                      United States’’, Buckley v. Valeo, 424 U.S. at 126, and (ii) it
                                      is ‘‘continuing’’, Auffmordt v. Hedden, 137 U.S. 310, 326–328
                                      (1890); United States v. Germaine, 99 U.S. at 511–512;
                                        79 The requirements of the Appointments Clause are not implicated unless an ‘‘office’’ exists.

                                      Freytag v. Commissioner, 501 U.S. at 880 (citing Buckley v. Valeo, 424 U.S. 1, 126 n.162 (1976)).
                                      Even if the position of a non-officer employee is clearly established by law, i.e., ‘‘the duties, sal-
                                      ary, and means of appointment * * * are specified by statute’’, id., at 881, appointments to that
                                      position need not conform to the Appointments Clause, id. at 880–881. In Freytag, the Supreme
                                      Court noted that the position of Special Trial Judge on this Court is ‘‘established by Law’’, but
                                      nonetheless stated that Special Trial Judges ‘‘need not be selected in compliance with the strict
                                      requirements of [the clause]’’ ‘‘if we * * * conclude that a special trial judge is only an em-
                                      ployee’’. Id. Likewise, in Landry v. FDIC, 204 F.3d 1125, 1133–1134 (D.C. Cir. 2000), the Court
                                      of Appeals for the District of Columbia Circuit noted that the position of ALJ for the Federal
                                      Deposit Insurance Corporation is ‘‘established by Law’’, but held that the position does not con-
                                      stitute an office. Moreover, the history of internal revenue collection in the United States is re-
                                      plete with officials whose positions were specified by statute, but were not appointed pursuant
                                      to the requirements of the clause. See supra pt. II.C.2.c.




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                                      160                135 UNITED STATES TAX COURT REPORTS                                         (114)


                                      United States v. Hartwell, 73 U.S. 385, 393 (1868). Whether
                                      a position possesses these characteristics and thus con-
                                      stitutes an office ‘‘is determined by the manner in which
                                      Congress has specifically provided for the creation of the sev-
                                      eral positions, their duties and appointment thereto.’’ Burnap
                                      v. United States, 252 U.S. 512, 516 (1920). Therefore, we
                                      examine the specific features of the ‘‘officer or employee’’
                                      position within the CDP function to determine whether it is
                                      a ‘‘continuing’’ office invested with ‘‘significant authority’’.
                                           1. Whether the CDP provisions created a ‘‘continuing’’
                                              position
                                         A position is ‘‘continuing’’ if it possesses ‘‘ ‘tenure, duration,
                                      emolument, and duties’ ’’ that are ‘‘ ‘continuing and perma-
                                      nent, not occasional or temporary.’ ’’ Auffmordt v. Hedden,
                                      supra at 327 (quoting United States v. Germaine, supra at
                                      511–512). A position is most clearly ‘‘continuing’’ if it is
                                      permanently assigned sovereign authority that does not
                                      expire, inter alia, upon the passage of time or the completion
                                      of a discrete task. See Auffmordt v. Hedden, supra at 326–
                                      328; United States v. Germaine, supra at 511–512; United
                                      States v. Hartwell, supra at 393. Respondent concedes that,
                                      if the CDP ‘‘appeals officer’’ is a position ‘‘established by Law’’,
                                      then it is a ‘‘continuing’’ position; and we therefore proceed
                                      to consider whether that position is given ‘‘significant
                                      authority’’, so that the person holding that position would be
                                      an officer (i.e., an ‘‘inferior Officer’’) rather than a non-officer
                                      employee.
                                           2. Whether the CDP hearing officer has ‘‘significant
                                              authority’’
                                         In Buckley v. Valeo, supra at 126, the Supreme Court held
                                      that a position invested with ‘‘significant authority’’ is an
                                      office:
                                      We think that the term ‘‘Officers of the United States’’ as used in Art. II,
                                      defined to include ‘‘all persons who can be said to hold an office under the
                                      government’’ in United States v. Germaine, supra, is a term intended to
                                      have substantive meaning. We think its fair import is that any appointee
                                      exercising significant authority pursuant to the laws of the United States
                                      is an ‘‘Officer of the United States,’’ and must, therefore, be appointed in
                                      the manner prescribed by § 2, cl. 2, of that Article.




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                                      (114)                         TUCKER v. COMMISSIONER                                           161


                                      In that case the Supreme Court examined the powers of the
                                      eight-member Federal Election Commission (FEC) established
                                      under the Federal Election Campaign Act of 1971 (1971 Act),
                                      Pub. L. 92–225, 86 Stat. 3, as amended by the Federal Elec-
                                      tion Campaign Act Amendments of 1974, Pub. L. 93–443, 88
                                      Stat. 1263. Id. at 137–141. The Supreme Court concluded
                                      that none of the FEC’s commissioners were appointed in con-
                                      formity with the clause, and thus, none of them were con-
                                      stitutionally permitted to exercise ‘‘significant authority’’. Id.
                                      at 137. It then sorted the FEC’s statutorily authorized powers
                                      into three categories in order to determine whether the
                                      powers in each category constituted significant authority:
                                      [T]he Commission’s powers fall generally into three categories: functions
                                      relating to the flow of necessary information—receipt, dissemination, and
                                      investigation; functions with respect to the Commission’s task of fleshing
                                      out the statute—rulemaking and advisory opinions; and functions nec-
                                      essary to ensure compliance with the statute and rules—informal proce-
                                      dures, administrative determinations and hearings, and civil suits. [Id.]

                                      The Supreme Court held that it was constitutionally permis-
                                      sible for the unappointed commissioners to exercise their
                                      investigatory and informative powers, because in so doing
                                      they were merely aiding Congress in performing its legisla-
                                      tive function. Id. at 137–138. Since Congress could delegate
                                      those powers to its own committees, the Supreme Court
                                      stated ‘‘there can be no question’’ that Congress could dele-
                                      gate them to the FEC by statute. Id.
                                         However, the Supreme Court held that it was not permis-
                                      sible for the unappointed commissioners to exercise their
                                      ‘‘more substantial [enforcement and interpretive] powers’’. Id.
                                      at 138. First, the Supreme Court held that only ‘‘Officers of
                                      the United States’’ could exercise the commissioners’ power
                                      to bring suit to enforce the 1971 Act, because that power ‘‘is
                                      the ultimate remedy for a breach of the law’’ and belongs to
                                      the Executive—not Legislative—Branch. Id. at 138–140.
                                      Second, the Supreme Court held that only ‘‘Officers of the
                                      United States’’ could exercise the commissioners’ power to
                                      interpret the entire 1971 Act through rulemaking, advisory
                                      opinions, and determinations—without supervision from
                                      either Congress or the Executive Branch—because that
                                      power ‘‘represents the performance of a significant govern-
                                      mental duty exercised pursuant to a public law.’’ Id. at 140–




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                                      141. From Buckley we therefore draw the general principle
                                      that only an ‘‘officer’’ may perform ‘‘significant’’ enforcement
                                      and interpretive functions. See id. at 124–141. In particular,
                                      the powers (i) to bring suit to enforce an Act of Congress and
                                      (ii) to issue regulations, advisory opinions, and determina-
                                      tions without supervision under an Act of Congress both con-
                                      stitute ‘‘significant authority’’.
                                         The Supreme Court has yet to fully define the term
                                      ‘‘significant authority’’; 80 and ‘‘ascertaining the test’s real
                                      meaning requires a look at the roles of the employees whose
                                      status was at issue in other cases.’’ Landry v. FDIC, 204 F.3d
                                      at 1133. In the two cases most analogous to our facts, the
                                      Supreme Court in Freytag and the Court of Appeals for the
                                      District of Columbia Circuit in Landry analyzed whether dif-
                                      ferent adjudicative positions constituted ‘‘offices’’. In Freytag
                                      the Supreme Court faced the question whether a Special
                                      Trial Judge (STJ) of the Tax Court is an ‘‘inferior Officer’’;
                                      and it observed that in some matters the STJ will ‘‘only hear
                                      the case and prepare proposed findings and an opinion’’ while
                                      in other matters the STJ may be assigned ‘‘not only to hear
                                      and report on a case but to decide it’’. Freytag v. Commis-
                                      sioner, 501 U.S. at 873. In deciding that STJs are ‘‘inferior
                                      Officers’’, the Supreme Court relied on the authority of STJs
                                      to render the final decision of this Court in some of the mat-
                                      ters that come before them. See id. at 882.
                                         In contrast, in Landry v. FDIC, supra at 1134, the Court
                                      of Appeals decided that ALJs for the Federal Deposit Insur-
                                      ance Corporation (FDIC) are not inferior officers. Both the
                                      ALJs in Landry and the STJs on this Court ‘‘ ‘take testimony,
                                      conduct trials, rule on the admissibility of evidence, and have
                                      the power to enforce compliance with discovery orders.’ ’’ Id.
                                         80 While ‘‘significant authority’’ is an essential characteristic of an ‘‘office’’, Buckley v. Valeo,

                                      424 U.S. at 126, this proposition cannot be construed to mean that non-officer employees of the
                                      Federal Government are insignificant or trivial. Mr. Tucker suggests that treating ‘‘appeals offi-
                                      cers’’ as non-officer employees not subject to the Appointments Clause is to regard them as ‘‘un-
                                      important’’. We disagree. For example, military ranks reflect the same distinction between offi-
                                      cers who are appointed in compliance with the Appointments Clause, see 10 U.S.C. secs. 531,
                                      571, 624 (2006), and non-officers who are not. However, those non-officers include ‘‘noncommis-
                                      sioned officers’’ (sergeants, corporals, and petty officers) who are promoted (not appointed) from
                                      among enlisted personnel. See, e.g., Army Regulation 600–8–19 (‘‘Enlisted Promotions and Re-
                                      ductions’’), ch. 3 (‘‘Semicentralized Promotions (Sergeant and Staff Sergeant)’’), sec. 3.1. No one
                                      could reasonably call the role of noncommissioned officers ‘‘insignificant’’. They have command
                                      of the enlisted personnel under them, and insubordination or disobedience of their commands
                                      is punishable by court-martial. See 10 U.S.C. sec. 891 (2006). Thus, the issue here is not wheth-
                                      er appeals officers are unimportant, but whether they are ‘‘Officers of the United States’’.




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                                      (114)                         TUCKER v. COMMISSIONER                                           163


                                      (quoting Freytag v. Commissioner, 501 U.S. at 881–882).
                                      However, unlike the STJs, the ALJs lacked the power to make
                                      final decisions. Id. at 1133. Instead, ALJs file a recommended
                                      decision, 12 C.F.R. sec. 308.38 (1996), which the FDIC’s board
                                      of directors reviews de novo before it issues the final decision
                                      of the agency, id. sec. 308.40(a), (c). This lack of finality led
                                      the Court of Appeals to conclude that the ALJs in question
                                      are not officers. Landry v. FDIC, supra at 1134.
                                         This focus in Landry on final decision-making power is an
                                      appropriate application of the Supreme Court’s earlier anal-
                                      ysis of the FEC’s interpretive powers in Buckley v. Valeo, 424
                                      U.S. at 140–141, which held that the power to interpret the
                                      1971 Act ‘‘free from day-to-day supervision of either Congress
                                      or the Executive Branch’’ constitutes significant authority.
                                      The power to make a final decision, which the Supreme
                                      Court described as ‘‘independent authority’’ in Freytag v.
                                      Commissioner, supra at 882, is a species of the power to act
                                      without supervision. See Buckley v. Valeo, supra at 141.
                                      Therefore, a position that is invested with broad adjudicative
                                      powers, like the position of STJ, may be an office if the
                                      incumbent can act free of supervision or has the final say
                                      within the agency. See Freytag v. Commissioner, supra at
                                      882. However, such a position is not an office if the incum-
                                      bent and her determinations are subject to supervision. See
                                      Landry v. FDIC, supra at 1133–1134.
                                         Mr. Tucker and the amicus contend that the positions of
                                      settlement officer and team manager within the Office of
                                      Appeals are invested with ‘‘significant authority’’. In par-
                                      ticular, Mr. Tucker posits that ‘‘Settlement Officers, and/or
                                      Appeals team managers holding CDP hearings are so similar
                                      to Special Trial Judges in all ways that mattered to the
                                      Supreme Court in its Freytag Appointments Clause analysis
                                      that any differences are not of Constitutional significance.’’
                                      We disagree.
                                         While settlement officers, appeals officers, and team man-
                                      agers can be said to possess adjudicative powers to conduct
                                      hearings and to issue determinations to resolve those
                                      hearings, none possess the power to make final decisions for
                                      the IRS. Contrary to Mr. Tucker’s assertion that ‘‘[n]otices of
                                      determination issued by Appeals personnel after CDP
                                      hearings are final and binding on the IRS’’, determinations by
                                      settlement officers and Appeals team managers are not




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                                      ‘‘final’’ in the sense that is relevant to the Appointments
                                      Clause. They review only a particular collection episode—a
                                      given notice of lien or notice of proposed levy. As is discussed
                                      above in part II.C.3.a, in the absence of a written agreement
                                      with the taxpayer, the Office of Appeals (not the appeals
                                      officer) retains jurisdiction to reconsider and overturn its
                                      personnel’s determinations with respect to collection action.
                                      Sec. 6330(d)(2). If Mr. Tucker’s circumstances were to
                                      change, and it became clear that he could never repay the
                                      IRS, nothing would prevent collection personnel from
                                      relenting or prevent the Office of Appeals from holding a
                                      supplemental CDP hearing and revising its personnel’s prior
                                      determination to uphold the tax lien.
                                          Even determinations with respect to underlying liability by
                                      the personnel of the Office of Appeals are not binding on the
                                      IRS and may be overturned during audit reconsideration or
                                      overruled by the IRS Office of Chief Counsel in taking litiga-
                                      tion positions or settling cases. See supra part II.C.3.b. The
                                      Office of Chief Counsel, not the Office of Appeals, has
                                      authority to ‘‘[n]egotiate or make a settlement in any case
                                      docketed in the Tax Court if the * * * determination was
                                      issued by Appeals officials’’. 26 C.F.R. sec. 601.106(a)(2)(i),
                                      Statement of Procedural Rules. Here, the Office of Chief
                                      Counsel was free to contest or settle Mr. Tucker’s case, not-
                                      withstanding the team manager’s determinations to uphold
                                      the tax lien at issue.
                                          No position within the Office of Appeals is invested, in the
                                      CDP context, with the ‘‘final’’ decision-making power that may
                                      be exercised only by an ‘‘officer of the United States’’. For
                                      that reason, settlement officers, appeals officers, and team
                                      managers are more analogous to the ALJs in Landry than to
                                      the STJs in Freytag.
                                          Moreover, non-officer ALJs have the authority to conduct
                                      ‘‘on the record’’ hearings, to require attendance at those
                                      hearings, to administer oaths and affirmations, to issue sub-
                                      poenas, to rule on offers of proof and receive evidence, and
                                      to order depositions. 5 U.S.C. secs. 554–557. Despite this
                                      authority, the Court of Appeals for the District of Columbia
                                      Circuit held that the ALJs in Landry are not officers because
                                      they lack final decision-making power. Landry v. FDIC, 204




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                                      F.3d at 1133–1134. 81 In contrast, settlement officers, appeals
                                      officers, and team managers lack not only final decision-
                                      making power but also these formal powers granted to ALJs
                                      under the Administrative Procedure Act. See 26 C.F.R. sec.
                                      301.6330–1(d)(2), Q&A–D6, Proced. & Admin. Regs. CDP
                                      hearings are ‘‘informal in nature’’ and do not even require a
                                      face-to-face meeting. Id.
                                         Since we find persuasive the reasoning of the Court of
                                      Appeals for the District of Columbia Circuit in its determina-
                                      tion that ALJs for the FDIC do not exercise ‘‘significant
                                      authority’’, we hold that the lesser position of CDP ‘‘appeals
                                      officer’’ (‘‘or employee’’) within the Office of Appeals likewise
                                      does not exercise ‘‘significant authority’’. We therefore hold
                                      that the positions of settlement officer, appeals officer, and
                                      team manager are not invested with ‘‘significant authority’’
                                      under Buckley v. Valeo, 424 U.S. at 126.

                                                                                Conclusion
                                         An ‘‘officer or employee’’ of the IRS Office of Appeals who
                                      conducts CDP hearings has neither a position ‘‘established by
                                      Law’’ nor ‘‘significant authority’’ that is characteristic of an
                                      ‘‘officer of the United States’’ for purposes of the Appoint-
                                      ments Clause. Without at all minimizing the importance of
                                      conducting a CDP hearing, that function does not involve an
                                      authority more ‘‘significant’’ than the authority exercised by
                                      other personnel important to tax administration (whether the
                                      Chief of the Office of Appeals (their superior), other high-
                                      ranking officials in the IRS, or many internal revenue collec-
                                      tion personnel over the past 200 years) or as significant as
                                      the authority exercised by ALJs in many other agencies. To
                                      survey these thousands of employees important to the
                                      administration of law and single out IRS ‘‘appeals officers’’ as
                                        81 The status of ALJs as employees or ‘‘Officers of the United States’’ is ‘‘disputed’’. Free Enter.

                                      Fund v. PCAOB, 516 U.S. at ll n.10, 130 S. Ct. at 3160 (citing Landry v. FDIC, 204 F.3d
                                      1125 (D.C. Cir. 2000)). In Landry a divided panel of the Court of Appeals for the D.C. Circuit
                                      held that ALJs for the FDIC are not officers. However, in Free Enter. Fund v. PCAOB, dis-
                                      senting Justice Breyer apparently indicates that he would hold that all ALJs are officers. 516
                                      U.S. at ll, 130 S. Ct. at 3180 (Breyer, J., dissenting) (citing Freytag v. Commissioner, 501
                                      U.S. at 910 (Scalia, J., concurring in part and concurring in judgment)). No court has held con-
                                      trary to Landry, and we follow it. However, even assuming arguendo that ALJs are ‘‘Officers
                                      of the United States’’, it does not follow that CDP hearing officers are likewise ‘‘officers’’. CDP
                                      hearing officers lack not only final decision-making power but also the formal powers granted
                                      to ALJs. Whether or not the position of ALJ constitutes an ‘‘Office[ ] of the United States’’, the
                                      lesser position of CDP ‘‘appeals officer’’ is not an ‘‘office’’.




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                                      166                135 UNITED STATES TAX COURT REPORTS                                         (114)


                                      somehow requiring constitutional appointment would be
                                      unwarranted. They are instead properly hired, pursuant to
                                      section 7804(a), under the authority of the Commissioner of
                                      Internal Revenue.
                                        To reflect the foregoing,
                                                                                 An appropriate order will be issued.

                                                                               f




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