                  T.C. Summary Opinion 2008-58



                      UNITED STATES TAX COURT



                 MARKO FILIPOVICH, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 13302-06S.               Filed May 21, 2008.



     Marko Filipovich, pro se.

     Mayer Y. Silber, for respondent.



     GOLDBERG, Special Trial Judge:     This case was heard pursuant

to the provisions of section 7463 of the Internal Revenue Code in

effect at the time the petition was filed.    Pursuant to section

7463(b), the decision to be entered is not reviewable by any

other court, and this opinion shall not be treated as precedent

for any other case.   Unless otherwise indicated, subsequent

section references are to the Internal Revenue Code.
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     Petitioner filed a petition with this Court in response to a

Notice of Determination Concerning Collection Action(s) Under

Section 6320 and/or 6330 (notice of determination) for 2002 and

2003.   Pursuant to section 6330(d), petitioner seeks review of

respondent’s determination.    The issue for decision is whether

respondent abused his discretion by sustaining the filing of a

Federal tax lien.

                              Background

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

The stipulation of facts and the exhibits received into evidence

are incorporated herein by reference.      At the time the petition

was filed, petitioner resided in Illinois.

     Petitioner has a longstanding history of not paying his

Federal income taxes.   Specifically, petitioner failed to pay his

Federal income taxes due for taxable years 1993 through 2003.

     Petitioner filed his Forms 1040, U.S. Individual Income Tax

Return, for 2002 and 2003 on August 11, 2003, and December 14,

2004, respectively, and the amounts reported due for those years,

$4,991 and $11,337, respectively, were assessed.

     A notice and demand for payment was mailed to petitioner

within 60 days of each assessment as required under section 6303.

In response, petitioner submitted an offer-in-compromise (OIC) on

June 6, 2005.   In his OIC petitioner offered $750 to settle in

full his unpaid taxes for the years 1993 through 2003.     On August
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19, 2005, the Internal Revenue Service (IRS) rejected

petitioner’s OIC, and petitioner protested by letter received by

the IRS on September 22, 2005.    On November 10, 2005, respondent

notified petitioner that his protest was untimely and that his

file was being returned to the offer unit.

      On August 19, 2005, Letter 3172, Notice of Federal Tax Lien

Intent to Levy and Your Right to a Hearing under Section 6320

(notice of Federal tax lien), was mailed to petitioner with

respect to the years at issue.    The notice of Federal tax lien

indicated that a Federal tax lien could be filed at any time.      A

notice of Federal tax lien was filed against petitioner on August

30, 2005, at the office of the Recorder of Deeds for DuPage

County, Illinois.

     On September 9, 2005, petitioner submitted Form 12153,

Request for a Collection Due Process Hearing, in which he claimed

that the notice of Federal tax lien was filed as an act of

retaliation by the same Appeals officer who, he claimed, denied

his OIC.   Petitioner also claimed that sustaining the notice of

Federal tax lien would “not be in the best interest of the

government” and that it would impair his ability to find a job.

     On October 7, 2005, petitioner filed a bankruptcy petition

under chapter 7 of the Bankruptcy Code in the U.S. Bankruptcy

Court for the Northern District of Illinois.    On January 30,
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2006, the bankruptcy court granted a discharge of petitioner’s

Federal tax liabilities for taxable years 1993 through 2001.

       On March 7, 2006, the collection due process hearing was

held between petitioner and Appeals Officer Karin Banks (Ms.

Banks), who had earlier mailed to petitioner a letter that listed

the statutory requirements to obtain a withdrawal of a notice of

Federal tax lien pursuant to section 6323(j).    During the hearing

petitioner presented an account of his financial situation and

reiterated his interest in making an OIC.    On the basis of her

review of the financial information provided by petitioner, Ms.

Banks did not extend an offer to settle the tax liabilities owed.

       Petitioner did not offer any arguments as to why the notice

of Federal tax lien should be withdrawn pursuant to section

6323(j).    Petitioner only reiterated his position that the

Appeals officer who denied his $750 OIC filed the notice of

Federal tax lien in retaliation.

       On June 6, 2006, the Appeals Office in Chicago issued

petitioner a notice of determination sustaining the filing of the

notice of Federal tax lien and finding that none of the statutory

requirements for withdrawal pursuant to section 6323(j) had been

met.    In response to the notice of determination, petitioner

timely filed his petition with this Court on July 11, 2006.
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                             Discussion

     As this case does not concern petitioner’s underlying

Federal income tax liabilities, the Court’s review falls under

the abuse of discretion inquiry of section 6330.      See Sego v.

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

T.C. 176, 182 (2000).   This standard requires the Court to decide

whether respondent’s rejection of petitioner’s request to have

the Federal tax lien withdrawn was arbitrary, capricious, or

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

112 T.C. 19, 23 (1999); Keller v. Commissioner, T.C. Memo. 2006-

166; Fowler v. Commissioner, T.C. Memo. 2004-163.

     Section 6321 imposes a lien in favor of the United States on

all property and rights to property of a person liable for tax

and any additions to tax, penalties, interest, and costs that may

accrue in addition thereto if there has been a demand for payment

and the person has failed to pay.       Iannone v. Commissioner, 122

T.C. 287, 293 (2004).   This lien arises at the date of the

assessment.   Sec. 6322.   So that the Federal tax lien will take

precedence over other liens or security interest, the IRS must

file a notice of Federal tax lien.      Sec. 6323(a); Behling v.

Commissioner, 118 T.C. 572, 575 (2002).

     Section 6323(j) provides in pertinent part:

          SEC. 6323(j).    Withdrawal of Notice in Certain
     Circumstances.--
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               (1) In general.–-The Secretary may
          withdraw a notice of lien filed under this
          section * * * if the Secretary determines
          that–-

                         (A) the filing of such notice was
                    premature or otherwise not in accordance
                    with administrative procedures of the
                    Secretary,

                         (B) the taxpayer has entered into an
                    agreement under section 6159 to satisfy the
                    tax liability for which the lien was
                    imposed by means of installment payments,
                    unless such agreement provides otherwise,

                         (C) the withdrawal of such notice
                    will facilitate the collection of the tax
                    liability, or

                         (D) with the consent of the taxpayer
                    or the National Taxpayer Advocate, the
                    withdrawal of such notice would be in the
                    best interests of the taxpayer (as
                    determined by the National Taxpayer
                    Advocate) and the United States.

     Petitioner contends, for the following reasons, that Ms.

Banks abused her discretion by failing to withdraw the notice of

Federal tax lien:    (1) Under section 6323(j)(1)(C)--because the

withdrawal of the notice would help facilitate the collection of

tax; and (2) under section 6323(j)(1)(D)--because it serves no

purpose other than to retaliate against petitioner and prevent

him from securing a job.    For the reasons discussed infra, we

disagree with petitioner.

     At the outset, we note that although petitioner has not

challenged the administrative procedures followed in the filing

of the notice of Federal tax lien, we find that the notice of
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Federal tax lien was not filed prematurely.    The filing of the

Federal tax lien took place after assessment and notice and

demand, and at each step petitioner was properly notified.

     Petitioner offered not one scintilla of evidence to show how

the withdrawal of the notice of Federal tax lien would facilitate

the collection of the liabilities owed.    In fact, looking at the

long history of petitioner’s failure to pay Federal income taxes,

coupled with his filing a petition for bankruptcy under chapter

7, it is obvious to the Court that the IRS would have no easier

time collecting the liabilities without the filing of a notice of

Federal tax lien than with it being filed.    It is our opinion

that the Appeals officer correctly determined that a withdrawal

of the notice of Federal tax lien would not be in the best

interests of the Government given petitioner’s history of

nonpayment and his financial status.    Moreover, by sustaining the

notice of Federal tax lien, respondent properly protected the

Government’s interests in petitioner’s assets.

     Petitioner also contends that an abuse of discretion

occurred when Ms. Banks refused to accept a second OIC at the

hearing.   He claims that Ms. Banks’s rejection of that OIC, based

on her knowledge of his failure to pay past and current taxes,

constituted an abuse of discretion.    We disagree.   In Giamelli v.

Commissioner, 129 T.C. 107, 111-112 (2007), we held that a

“Reliance on a failure to pay current taxes in rejecting a
                               - 8 -

collection alternative does not constitute an abuse of

discretion.”   Moreover, during the hearing petitioner was never

clear as to what amount he would be willing to pay to settle his

outstanding liabilities.   We view his demeanor at that hearing to

be nothing more than uncooperative so as to prolong this matter

and, accordingly, the time at which he would be finally required

to pay the amounts owed.

     As to petitioner’s argument that the filing and sustaining

of the notice of Federal tax lien was an act of retaliation by

Ms. Banks, petitioner provided no specific evidence in support of

this accusation.   Moreover, we are not convinced that Ms. Banks

was even the Appeals officer responsible for rejecting

petitioner’s original OIC.   Even if she was, there is no evidence

to support petitioner’s contention that the notice of Federal tax

lien filed against him was the result of a personal vendetta on

the part of Ms. Banks.   In short, we find petitioner’s assertion

that the notice of Federal tax lien was filed as a retaliatory

act to be both inflammatory and without merit.

     Petitioner did not offer any evidence pursuant to section

6323(j)(1)(D) to support his contention that the National

Taxpayer Advocate determined that a withdrawal of the notice of

Federal tax lien would be in the best interests of petitioner and

the United States.   The record contains a letter dated December

16, 2004, from the National Taxpayer Service in Chicago,
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Illinois.    This letter does not contain any determination on the

part of the National Taxpayer Advocate.      To wit, the letter was

sent to petitioner long before the notice of Federal tax lien was

filed.    The letter only relates information regarding what

publications petitioner should refer to for an explanation of the

collections process.

       Finally, petitioner did not offer any evidence to support

his contention that the withdrawal would allow him to secure a

job.    This assertion is purely conjecture.

       On our review of the record, we conclude that respondent’s

Appeals officer did not abuse her discretion in sustaining the

notice of Federal tax lien.

       To reflect the foregoing,


                                           Decision will be entered

                                       for respondent.
