                  T.C. Summary Opinion 2009-85



                     UNITED STATES TAX COURT



                   ANDREW BANKS, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 4407-06S.              Filed June 1, 2009.



     Michael B. Van Landingham, for petitioner.

     Michael T. Sargent, for respondent.



     GUSTAFSON, Judge:   This case was heard pursuant to the

provisions of section 74631 of the Internal Revenue Code in

effect when the petition was filed.   Pursuant to section 7463(b),

the decision to be entered is not reviewable by any other court,




     1
      Unless otherwise noted, citations herein of sections refer
to the Internal Revenue Code (26 U.S.C.), and citations of Rules
refer to the Tax Court Rules of Practice and Procedure.
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and this opinion shall not be treated as precedent for any other

case.

       This case is an appeal by petitioner Andrew Banks under

sections 6320(c) and 6330(d), seeking our review of the

determination by an appeals officer of the Internal Revenue

Service (IRS) sustaining the filing of a notice of Federal tax

lien relating to Mr. Banks’s unpaid income tax liabilities for

tax years 2000, 2001, and 2002.    The issue for decision is

whether the IRS abused its discretion in sustaining the filing of

a notice of Federal tax lien.     We hold that it did not.

                             Background

       This case was submitted fully stipulated pursuant to

Rule 122.    The stipulation of facts filed December 8, 2008, and

the attached exhibits are incorporated herein by this reference.

At the time that he filed his petition, Mr. Banks resided in

South Carolina.

       Mr. Banks filed his 2000 Form 1040, U.S. Individual Income

Tax Return, almost 11 months late on March 11, 2002.    The return

reported a balance due of $1,879 and an estimated tax penalty of

$96.    Mr. Banks did not claim head of household filing status,

dependency exemption deductions, or an earned income credit on

his 2000 return.

       Shortly thereafter, on or before April 15, 2002, Mr. Banks

timely filed his 2001 Form 1040, showing an overpayment of
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$2,252.    On November 15, 2002, the IRS issued to Mr. Banks a

statutory notice of deficiency for tax year 2001 wherein the IRS

determined a deficiency of $4,877.90 in Mr. Banks’s 2001 income

tax.    This deficiency was based on the IRS’s disallowance of

(i) Mr. Banks’s head of household filing status, (ii) the

dependency exemption deduction claimed for a minor child, and

(iii) the earned income tax credit.     The notice of deficiency was

mailed to Mr. Banks’s last known address.    The last day to

petition the Tax Court for a redetermination of this deficiency

was February 13, 2003.    Mr. Banks failed to do so.

       Mr. Banks timely filed his 2002 Form 1040 showing an

overpayment of $776.    On September 19, 2003, the IRS issued to

Mr. Banks a notice of deficiency for tax year 2002 wherein the

IRS determined a deficiency of $3,375 in Mr. Banks’s 2002 income

tax.    Just as before, this deficiency was based on the IRS’s

disallowance of (i) Mr. Banks’s head of household filing status,

(ii) the dependency exemption deduction claimed for a minor

child, and (iii) the earned income tax credit.    The notice of

deficiency was mailed to Mr. Banks’s last known address.       The

last day to petition the Tax Court for a redetermination of this

deficiency was December 18, 2003.    Mr. Banks failed to do so.

       On February 28, 2005, the IRS received a letter from

Mr. Banks’s accountant, Mary E. Dwyer, C.P.A., “requesting that

the tax years of 2001 and 2002 be opened for reconsideration
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* * * [because] Mr. Banks has provided [her] with several

documents that will show he was the legal guardian of [his

daughter] for the years 2001 and 2002.”       The record does not

reflect that Mr. Banks’s 2001 and 2002 years were ever reopened

for reconsideration.

     On June 23, 2005, the IRS filed with the Register of Deeds

of Charleston County, South Carolina, a notice of Federal tax

lien relating to Mr. Banks’s unpaid income tax liabilities for

2000, 2001, and 2002.    On June 28, 2005, the IRS issued to

Mr. Banks a Notice of Federal Tax Lien Filing and Your Right to a

Hearing Under IRC 6320 regarding his unpaid taxes for 2000, 2001,

and 2002.    On August 3, 2005, Mr. Banks timely requested a

collection due process (CDP) hearing by submitting to the IRS a

Form 12153, Request for a Collection Due Process or Equivalent

Hearing.    In his request for a hearing, Mr. Banks stated:

     My tax return was denied for these years because the IRS
     refuses to accept the amount of proof that I am a single
     parent. And, therefore the money I should have receive[d]
     to help support my daughter, dependent, has placed me in
     debt.

On October 24, 2005, the IRS’s Office of Appeals sent a letter to

Mr. Banks acknowledging that the Office of Appeals had received

his request for a CDP hearing.    Then, by letter dated November

18, 2005, the settlement officer scheduled Mr. Banks’s telephone

CDP hearing for December 15, 2005.       In that November 18 letter

the settlement officer explained the CDP process, advised
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Mr. Banks of his right to a face-to-face hearing, and instructed

Mr. Banks that in order for the Office of Appeals “to consider

alternative collection methods such as an installment agreement

or offer in compromise, you must provide any items listed below.

In addition, you must have filed all federal tax returns due.”

The items listed below were:

     •    A completed Collection Information Statement (Form 433-
          A for individuals and/or Form 433-B for businesses.)

     •    Signed tax return(s) for the following periods. Our
          records indicate they have not been filed:
          Type of Tax:        Income
          Period or Periods: December 31, 2003 & December 31,
                              2004

The settlement officer asked for the requested information to be

submitted within 14 days and stated:    “I cannot consider

collection alternatives at your conference without this

information.”

     Mr. Banks failed to contact the settlement officer at the

time designated for his CDP hearing.    By letter dated December

15, 2005, the settlement officer gave Mr. Banks another

opportunity to reschedule his CDP hearing and/or submit

information for her consideration.     Mr. Banks availed himself of

the opportunity to reschedule his CDP hearing, and his telephone

CDP hearing was held on January 11, 2006.    At the time of the

hearing, Mr. Banks had yet to supply the settlement officer with

the information requested in her November 18 letter.
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     During Mr. Banks’s CDP hearing, he informed the settlement

officer that he wished to withdraw his request for a CDP hearing,

and he requested information regarding the reopening of the

examination of his 2001 and 2002 Federal income tax returns.      By

letter dated January 11, 2006, the settlement officer sent to

Mr. Banks a Form 12256-c, Withdrawal of Request for Collection

Due Process Hearing, requesting that Mr. Banks sign and return

the form no later than January 18, 2006.   The settlement officer

also forwarded to Mr. Banks IRS Publication 3598, which describes

the IRS’s audit reconsideration process.

     Mr. Banks failed to return the Form 12256-c to the

settlement officer by that January 18 deadline.    Furthermore,

Mr. Banks had still failed to provide the settlement officer with

his financial information and outstanding tax returns as

requested in her November 18 letter.   As a result, on

February 2, 2006, the Office of Appeals issued to Mr. Banks a

Notice of Determination Concerning Collection Action(s) Under

Section 6320 and/or 6330, which sustained the filing of the

notice of Federal tax lien.   The Office of Appeals upheld the

filing because Mr. Banks “failed to provide the requested

financial information so a collection alternative could be

decided * * * [and] [t]here is no record of Form 1040 for periods

ending December 31, 2003 and December 31, 2004.”
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     On March 2, 2006, Mr. Banks timely petitioned this Court to

review the notice of determination issued on February 2, 2006.

Paragraph 4 of his petition summarizes his position as follows:

     My tax problems relate to dependency issues and proof of
     residency. I don’t have a long form birth certificate for
     this dependent, but, I have supplied many documents proving
     my case including the rulings from the Family Court of
     Charleston, S.C. giving me custody of this dependent. I
     believe a blood test is going to cost me six or seven
     hundred dollars.

                            Discussion

I.   Applicable Legal Principles

     A.   Collection Review Procedure

     If a taxpayer fails to pay any Federal income tax liability

after notice and demand, 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.

     However, Congress has added to chapter 64 of the Internal

Revenue Code provisions (in subchapter C, part I, and in

subchapter D, part I) for “Due Process for Liens” and “Due

Process for Collections”.   The IRS must comply with those

provisions after filing a tax lien.    Within 5 business days 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 before the Office of Appeals.

Sec. 6320(b)(1).
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     The pertinent procedures for the administrative hearing,

known as the CDP hearing, are set forth in section 6330(c).

First, the appeals officer must obtain verification from the

Secretary that the requirements of any applicable law or

administrative procedure have been met.     Sec. 6330(c)(1).

Second, the taxpayer may raise any issue relevant to the unpaid

tax or proposed collection action at the hearing, including

challenges to the appropriateness 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.   Sec. 6330(c)(2)(B).

     The appeals officer must determine whether the lien should

be released.   The appeals officer is required to take into

consideration:   (1) “verification from the Secretary that the

requirements of any applicable law and administrative procedure

have been met” (see sec. 6330(c)(3)(A), citing sec. 6330(c)(1));

(2) relevant issues raised by the taxpayer (see sec.

6330(c)(3)(B), citing sec. 6330(c)(2)); and (3) “whether any

proposed collection action balances the need for the efficient

collection of taxes with the legitimate concern of the person

that any collection action be no more intrusive than necessary”

(see sec. 6330(c)(3)(C)).   If the Office of Appeals then issues a
                                 - 9 -

notice of determination to uphold the lien, the taxpayer may

appeal the determination to this Court within 30 days (see secs.

6320(c), 6330(d)(1)), as Mr. Banks has done.   On review, the

Court will generally consider only arguments, issues, and other

matters that were actually raised by the taxpayer at the CDP

hearing.   Giamelli v. Commissioner, 129 T.C. 107, 115 (2007);

Magana v. Commissioner, 118 T.C. 488, 493 (2002).

     B.    Standard of Review

     Where the underlying tax liability is properly at issue in a

section 6330 hearing, the Court will review the matter de novo.

Davis v. Commissioner, 115 T.C. 35, 39 (2000).    However, where

the underlying liability is not at issue, we review the

determination of the Office of Appeals for an abuse of

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

Mr. Banks has 3 tax years at issue in this CDP review, i.e.,

2000, 2001, and 2002.

     Mr. Banks’s tax liability for 2000 was a self-reported

liability that he has not challenged.    His petition states that

his “tax problems relate to dependency issues”–-i.e., issues not

implicated on his 2000 return.    Therefore, the underlying

liability for 2000 is not in dispute.    As for 2001 and 2002,

Mr. Banks does challenge his underlying liability for each of

those years, in that he disagrees with the IRS’s adjustments to

his filing status, dependency exemption deductions, and earned
                              - 10 -

income tax credit.   However, Mr. Banks stipulated that the IRS

mailed the notices of deficiency for 2001 and 2002 to his last

known address as required by law.   Mr. Banks therefore had a

prior opportunity to challenge the validity of those underlying

tax liabilities by petitioning the Tax Court from those notices

of deficiency.   Mr. Banks failed to do so and accordingly is

barred under section 6330(c)(2)(B) from challenging in this

proceeding the existence or amount of his underlying tax

liabilities for tax years 2001 and 2002.   See Goza v.

Commissioner, supra.

      Therefore, since Mr. Banks’s underlying liabilities for

2000, 2001, and 2002 are not properly at issue, we review the

IRS’s determination for an abuse of discretion; that is, we

decide whether the determinations were arbitrary, 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); Sego

v. Commissioner, 114 T.C. 604, 610 (2000).

II.   The Office of Appeals Did Not Abuse Its Discretion by
      Upholding the Filing of the Notice of Federal Tax Lien

      Mr. Banks was required by Rule 331(b)(4) to make “[c]lear

and concise assignments of each and every error which * * * he

alleges to have been committed in the notice of determination.”

Mr. Banks did not do so.   His petition simply reiterated his

disagreement with the IRS’s changes to his tax returns.    At best,

this is a continued challenge to the underlying liability, which
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we have already determined is not properly before us.

Furthermore, under Rule 331(b)(4), any issue not raised in the

petition’s assignments of error “shall be deemed to be conceded”.

Therefore, because Mr. Banks did not assign any errors to the

notice of determination, we could decide this case in

respondent’s favor on that ground alone.   See Swain v.

Commissioner, 118 T.C. 358 (2002).

     Nonetheless, we address the question whether the Office of

Appeals abused its discretion by upholding the Federal tax lien,

and we find that, for three reasons, the appeals officer acted

reasonably in determining that the Federal tax lien was

appropriate.

     First, the appeals officer’s determination to sustain the

proposed collection action was reasonable in view of Mr. Banks’s

failure to provide the requested financial information, i.e., a

Form 433-A, Collection Information Statement for Wage Earners and

Self-Employed Individuals.   It is not an abuse of discretion for

an appeals officer to sustain the proposed collection action on

the basis of the taxpayer’s failure to submit requested financial

information.   See Cavazos v. Commissioner, T.C. Memo. 2008-257;

Prater v. Commissioner, T.C. Memo. 2007-241; Chandler v.

Commissioner, T.C. Memo. 2005-99; Roman v. Commissioner, T.C.

Memo. 2004-20.
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      Second, the appeals officer’s determination was reasonable

in view of Mr. Banks’s failure to file his income tax returns for

2003 and 2004.   Mr. Banks had been advised that his 2003 and 2004

returns were overdue, yet he never fulfilled his filing

obligations.   It is not an abuse of discretion for an appeals

officer to sustain a proposed collection action when the taxpayer

is not in compliance with current tax obligations.    See Giamelli

v. Commissioner, supra at 111-112.

     Third, the appeals officer’s determination was reasonable in

view of Mr. Banks’s failure to raise during the CDP hearing any

relevant issues or appropriate defenses pertaining to the

proposed collection action and his failure to offer any

collection alternatives for the appeals officer to consider.     It

is not an abuse of discretion for an appeals officer to sustain a

proposed collection action and not consider any collection

alternatives when the taxpayer has proposed none.    See Kendricks

v. Commissioner, 124 T.C. 69, 79 (2005).

     To reflect the foregoing,


                                      Decision will be entered for

                                 respondent.
