                  T.C. Memo. 2000-350



                UNITED STATES TAX COURT



     SAMUEL AND BERNICE BOONE TRUST, Petitioner v.
      COMMISSIONER OF INTERNAL REVENUE, Respondent



Docket No. 16141-99L.               Filed November 13, 2000.



     On its 1997 income tax return, P reported zero tax
liability and claimed a refund resulting from claimed
income tax withholding credits. R paid P the claimed
refund but later determined that the payment of the
refund was in error, as P had made no income tax
payments for which the withholding credits were
claimed. After R made summary assessment of the
erroneous refund, P requested a due process hearing.
After R issued a negative determination letter, P filed
a petition for judicial review of R’s administrative
determination. R filed a motion to dismiss for lack of
jurisdiction. Held, because the Court lacks
jurisdiction over the underlying tax liability that R
is attempting to collect, the Court lacks jurisdiction
to review the administrative determination in dispute.
                               - 2 -

     Samuel Boone and Bernice Boone (trustees), for petitioner.

     Steven M. Webster, for respondent.



                        MEMORANDUM OPINION


     THORNTON, Judge:   This matter is before the Court on

respondent’s motion to dismiss for lack of jurisdiction.1    As

discussed below, we shall grant respondent’s motion.

     Unless otherwise indicated, section references are to the

Internal Revenue Code as amended.

                            Background

     On its Form 1041, U.S. Income Tax Return for Estates and

Trusts, for taxable year 1997, petitioner reported income tax

liability of zero and income tax withholding credits of $165,149,

resulting in a refund claim of $165,149.     On December 7, 1998,

respondent issued petitioner a $166,293.04 refund for taxable

year 1997.2   Subsequently, respondent determined the refund had

been erroneously paid because petitioner had not made the income

tax payments for which credits had been claimed.     On March 15,

1999, respondent summarily assessed the previously refunded

amount and mailed petitioner a notice of tax due.     Respondent


     1
       The instant case involves the same jurisdictional issue as
Loadholt Trust v. Commissioner, T.C. Memo. 2000-349, also decided
today.
     2
       This amount represents the reported overpayment of
$165,149 plus interest of $1,144.04.
                                - 3 -

subsequently filed notices of Federal tax lien in connection with

the assessment.

     Petitioner timely filed with the Internal Revenue Service a

request for a due process hearing with regard to the filing of

the notices of Federal tax lien.   By notice of determination

dated September 15, 1999, respondent’s Appeals officer informed

petitioner that his office had reviewed the proposed collection

action and had determined that there were no deviations from

applicable law or administrative procedures that would warrant

release or withdrawal of the filed tax lien.3

     Respondent’s notice of determination stated that if

petitioner wanted to dispute the determination in court, it

should file a petition with the U.S. Tax Court.   The notice of

determination further stated:   “If the court determines that you

made your petition to the wrong court, you will have 30 days

after such determination to file with the correct court.”

     Petitioner timely filed a petition for redetermination with

this Court.   Respondent filed a motion to dismiss for lack of

jurisdiction.   In his motion, respondent argues that the Tax

Court lacks jurisdiction because petitioner’s tax liability was



     3
       The notice of determination states that the applicable
laws and administrative procedures were met with “one exception”,
apparently relating to the filing of two notices of Federal tax
lien in two different counties. Cf. sec. 6323(f)(1)(A)(i) and
(ii) (notice of Federal tax lien shall be filed “in one office
within the State”).
                               - 4 -

summarily assessed under the authority of section 6201(a)(3) and

“arose from a nonrebate erroneous refund which could not have

been assessed as a deficiency or otherwise been subject to the

jurisdiction of this Court under an alternative to assessment

under section 6201(a)(3).”

     On October 2, 2000, a hearing on respondent’s motion was

held at the Court’s trial session in Columbia, South Carolina.

                             Discussion

     Petitioner seeks judicial review of an administrative action

instituted by respondent to recover what respondent alleges was

an erroneous refund paid to petitioner.    As described below, the

administrative collection procedures instituted by respondent are

distinct from the deficiency procedures upon which this Court’s

jurisdiction is generally predicated.

     Section 6201 authorizes and requires the Secretary “to make

the inquiries, determinations, and assessments of all taxes * * *

imposed” by the Internal Revenue Code.    The assessment of tax,

which is ordinarily the first step in the collection process, is

accomplished by recording the taxpayer’s liability in the office

of the Secretary.   See sec. 6203.

     In certain circumstances, pursuant to the general authority

of section 6201, the Commissioner can summarily (immediately)

assess certain amounts, including overstatements on a return or a
                                  - 5 -

claim for refund of the credit for income tax withholdings.     See

sec. 6201(a)(3).

     In other circumstances, the Commissioner cannot assess the

tax until he has followed deficiency proceedings.     In particular,

if the Commissioner determines that there is a deficiency in the

taxpayer’s reported liability with respect to income taxes,

estate and gift taxes, and certain specified excise taxes, he

generally cannot assess the tax until a statutorily prescribed

period of time (generally 90 days or, for taxpayers outside the

country, 150 days) after he has issued the taxpayer a notice of

deficiency.   See sec. 6213(a).    During this time, the taxpayer

may file a petition in the Tax Court, and the Commissioner

generally may not assess or collect the tax until the Tax Court’s

decision has become final.   See id.

     Once the Commissioner has assessed the tax, he may institute

administrative collection action.     Section 6321 provides that if

any person liable to pay any tax neglects or refuses to pay the

same after notice and demand, the amount shall be a lien in favor

of the United States upon all property and rights to property,

whether real or personal, belonging to that person.     Section 6323

generally requires the Commissioner to file a notice of Federal

tax lien with the appropriate State office or the local Federal

District Court.
                               - 6 -

     Section 6331(a) provides that if any person liable to pay

any tax neglects or refuses to pay such tax within 10 days after

notice and demand for payment, the Secretary is authorized to

collect such tax by levy upon property belonging to the taxpayer.

Under section 6331(d) the Secretary must provide the taxpayer

with notice, including notice of the administrative appeals

available to the taxpayer, before proceeding with collection by

levy on the taxpayer’s property.

     As enacted in the Internal Revenue Service Restructuring and

Reform Act of 1998 (RRA 1998), Pub. L. 105-206, sec. 3401, 112

Stat. 685, 746, sections 6320 (pertaining to liens) and 6330

(pertaining to levies) provide protections for taxpayers in tax

collection matters.   Sections 6320 and 6330 are effective with

regard to collection actions commenced on or after January 19,

1999.   See RRA 1998 sec. 3401(d), 112 Stat. 750.

     Section 6320(a)(1) requires the Commissioner to provide

notice to a person described in section 6321 of the filing of a

notice of lien under section 6323.     Section 6320(a)(3) and (b)

provides that the person described in section 6321 is entitled to

notice of and the opportunity for an administrative review of the

lien in the form of an Appeals Office hearing.     Section 6330

provides for a similar hearing where the Commissioner has

proposed to levy on the taxpayer’s property.     Section 6320(c)

adopts the procedures set forth in section 6330(c), (d), and (e)
                               - 7 -

governing the issues that may be raised in a hearing and the

means for obtaining judicial review of the matter.   See Goza v.

Commissioner, 114 T.C. 176 (2000).

     Section 6330(d) provides for judicial review of an

administrative determination regarding a collection matter as

follows:

     SEC. 6330(d).   Proceeding After Hearing.--

          (1) Judicial review of determination.--The person may,
     within 30 days of a determination under this section, appeal
     such determination–-

                (A) to the Tax Court (and the Tax Court shall have
           jurisdiction to hear such matter); or

                (B) if the Tax Court does not have jurisdiction of
           the underlying tax liability, to a district court of
           the United States.

     If a court determines that the appeal was to an incorrect
     court, a person shall have 30 days after the court
     determination to file such appeal with the correct court.

Interpreting these statutory provisions, we stated in Moore v.

Commissioner, 114 T.C. 171, 175 (2000):

     While Congress clearly intended for section 6330 to provide
     an opportunity for judicial review of collection matters, we
     interpret section 6330(d)(1)(A) and (B) together to mean
     that Congress did not intend to expand the [Tax] Court’s
     jurisdiction beyond the types of taxes that the Court may
     normally consider. Thus, section 6330(d)(1)(A) and (B)
     provides for Tax Court jurisdiction except where the Court
     does not normally have jurisdiction over the underlying
     liability. [Emphasis added.]

See also Van Es v. Commissioner, 115 T.C. ____ (2000).

     This Court is a court of limited jurisdiction, having only

such jurisdiction as provided by Congress.   See sec. 7442; see
                               - 8 -

also Estate of Meyer v. Commissioner, 84 T.C. 560, 562 (1985);

Adams v. Commissioner, 72 T.C. 81, 84 (1979), affd. without

published opinion 688 F.2d 815 (2d Cir. 1982).   With exceptions

not germane here, this Court’s jurisdiction is generally limited

to redetermining deficiencies in income taxes, estate and gift

taxes, and certain specified excise taxes that are subject to the

deficiency procedures outlined above.    See secs. 6214, 7442; see

also Estate of Meyer v. Commissioner, supra at 562; Judd v.

Commissioner, 74 T.C. 651, 653 (1980).

     In this case, respondent is attempting to collect an alleged

erroneous refund resulting from petitioner’s alleged

overstatement of income taxes withheld.   The assessments at issue

were not subject to the deficiency procedures but instead were

subject to the summary assessment procedures of section

6201(a)(3).   Under those procedures, overstatements of withheld

income taxes are generally treated in the same manner as

mathematical or clerical errors appearing on the return, except

that in the case of an assessment of an overstated credit for

withholding, the taxpayer has no right to request an abatement.

See secs. 6201(a)(3), 6213(b)(1) and (2).   Therefore, summary

assessments with respect to overstatements of withheld taxes
                                - 9 -

provide the taxpayer no right to petition the Tax Court to

contest the liability.    See sec. 6213(b)(1).4

     In sum, because we have no jurisdiction over the “underlying

tax liability” within the meaning of section 6330(d)(1)(B), we

have no jurisdiction over the instant petition for

redetermination, and we must grant respondent’s motion to

dismiss.

     Although petitioner cannot pursue its case in this Court, it

is not without a remedy.    Petitioner may seek judicial review in

the appropriate District Court of the United States.    See sec.

6330(d)(1)(B).




     4
         Sec. 6213(b)(1) provides:

            If the taxpayer is notified that, on account of a
            mathematical or clerical error appearing on the
            return, an amount of tax in excess of that shown
            on the return is due, and that an assessment of
            the tax has been or will be made on the basis of
            what would have been the correct amount of tax but
            for the mathematical or clerical error, such
            notice shall not be considered as a notice of
            deficiency * * * and the taxpayer shall have no
            right to file a petition with the Tax Court based
            on such notice, nor shall such assessment or
            collection be prohibited by the provisions of
            subsection (a) of this section. [Emphasis added.]

     As noted above, if the taxpayer so requests, a summary
assessment relating to a mathematical or clerical error must be
abated, and any reassessment must be made subject to the
deficiency procedures. See sec. 6213(b)(2). The abatement and
reassessment procedures do not apply, however, to assessments of
erroneous income tax prepayment credits. See sec. 6201(a)(3).
                        - 10 -

To reflect the foregoing,


                                 An appropriate order of

                            dismissal will be entered.
