                    128 T.C. No. 6



                UNITED STATES TAX COURT



            JOSEPH E. LEWIS, Petitioner v.
     COMMISSIONER OF INTERNAL REVENUE, Respondent



Docket No. 6284-06L.             Filed March 28, 2007.



     P filed his 2002 income tax return late. P
included payment for the reported tax due with his
return. R assessed additions to tax under sec.
6651(a)(1) and (2), I.R.C., for late filing and late
payment. P requested an abatement of the additions to
tax, which was ultimately denied after a hearing before
R’s Appeals Office. R then initiated a collection
action, and P now seeks review of his liability for
additions to tax under sec. 6330, I.R.C. R moves for
summary judgment pursuant to sec. 301.6330-1(e)(3),
Q&A-E2, Proced. & Admin. Regs. R argues that P had an
opportunity to dispute the underlying liability in a
conference with R’s Appeals Office and thus cannot
properly raise the underlying liability again in a sec.
6330, I.R.C., collection review proceeding.

     Held: Sec. 301.6330-1(e)(3), Q&A-E2, Proced. &
Admin. Regs., is valid.
                                 - 2 -

          Held, further, because P had a conference with R’s
     Appeals Office, he is precluded from disputing the
     assessed additions to tax again in his sec. 6330,
     I.R.C., action.



     Joseph E. Lewis, pro se.

     Linette B. Angelastro, for respondent.



                                OPINION


     GOEKE, Judge:   This matter is before the Court on

respondent’s motion for summary judgment.   Respondent moves for

summary judgment, pursuant to section 6330(c)(2)(B)1 and section

301.6330-1(e)(3), Proced. & Admin. Regs.    Respondent argues that

because petitioner was offered and participated in an Appeals

conference, he is precluded from properly raising his underlying

tax liability again in a subsequent collection review proceeding.

Because we find section 301.6330-1(e)(3), Q&A-E2, Proced. &

Admin. Regs., to be a reasonable expression of Congress’s intent

and because petitioner participated in a conference with Appeals

in which he was permitted to dispute his underlying tax

liability, we hold that petitioner may not properly raise his tax

liability again in a collection review hearing or before this

Court.   Accordingly, respondent’s motion will be granted.



     1
      Unless otherwise indicated, all section references are to
the Internal Revenue Code, as amended, and all Rule references
are to the Tax Court Rules of Practice and Procedure.
                                - 3 -

                             Background

     At the time his petition was filed, petitioner resided in

Lancaster, California.   Petitioner is a plumber by trade.

Petitioner and his wife jointly filed their Form 1040, U.S.

Individual Income Tax Return, for the 2002 tax year on January

25, 2004.   Petitioner reported a tax due of $11,636 and enclosed

payment of that amount with the return.    Petitioner’s return was

originally due on April 15, 2003.   Respondent assessed the tax

reported on the return, along with additions to tax, pursuant to

section 6651(a)(1) and (2), of $2,618.10 for late filing and

$581.80 for late payment.

     Petitioner then submitted a request to respondent to abate

the assessments of 2002 additions to tax based on reasonable

cause.    Petitioner argued that the additions to tax for his late

filing should be abated because his accountant, who possessed

petitioner’s tax documents, was hospitalized with stomach cancer

at the time petitioner’s taxes were due.   Petitioner’s request

was ultimately assigned to an Appeals officer.   The Appeals

officer reviewed the circumstances of the late filing, including

correspondence from petitioner as well as petitioner’s employer,

and declined to abate the additions to tax.   The Appeals officer

then sent petitioner a letter indicating that his appeal had been

denied.   On May 28, 2005, respondent issued to petitioner Letter

1058, Final Notice, Notice of Intent to Levy and Notice of Your

Right to a Hearing, advising petitioner that respondent intended
                                - 4 -

to levy on petitioner’s property to collect the unpaid liability

for tax year 2002.

     Thereafter, petitioner timely submitted Form 12153, Request

for a Collection Due Process Hearing, on June 15, 2005.    In his

Form 12153, petitioner again requested an abatement of the late

filing and late payment additions to tax assessed for tax year

2002.   Petitioner continued to argue that his late filing be

excused because of his accountant’s illness.

     Petitioner’s case was then assigned to a settlement officer

for a collection review hearing.    The settlement officer reviewed

the administrative file and determined that petitioner’s request

for an abatement of the late filing and late payment additions to

tax had already been considered by Appeals.    Thus, the settlement

officer determined that petitioner’s underlying liability could

not be raised properly again in his collection review hearing.

Petitioner did not raise any additional issues with respect to

the levy notice.

     On March 3, 2006, respondent issued to petitioner a Notice

of Determination Concerning Collection Action(s) under Section

6320 and/or 6330.    In response to the notice of determination,

petitioner filed a petition with this Court on March 30, 2006.

The only question raised in the petition is whether there is
                               - 5 -

reasonable cause to abate the additions to tax imposed by

respondent under section 6651(a)(1) and (2) for late filing and

late payment.

                            Discussion

I.   Section 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.

     Respondent argues that pursuant to section 6330(c)(2)(B) and

section 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs., where a

taxpayer has an opportunity for a conference with respondent’s

Appeals Office before a collection action has begun,2 then the

amount and existence of the underlying tax liability can neither

be raised properly in a collection review hearing nor on appeal

to this Court.   Thus, respondent argues for summary judgment on

the ground that petitioner’s participation in a conference with

the Appeals Office to consider his request for abatement of

additions to tax precluded him from raising his underlying

liability in his collection review hearing or in this Court.

     We have previously held that where a taxpayer filed amended

returns and was provided with an opportunity for a hearing with

respondent’s Appeals Office, the taxpayer was not entitled to

challenge the underlying liability in a subsequent collection



     2
       In this case petitioner actually participated in the prior
conference with Appeals. However, it appears respondent’s
position is that merely the offer of a prior conference with
Appeals is a sufficient opportunity to preclude subsequent review
of the liability in a collection review hearing. We do not
decide the more narrow question of whether simply an offer of a
conference with Appeals is sufficient to preclude subsequent
collection review consideration.
                                - 6 -

 review proceeding.    Farley v. Commissioner, T.C. Memo. 2004-168

(noting that the taxpayer still had the opportunity to seek

judicial review by paying the tax and filing suit for a refund in

District Court); see also Bailey v. Commissioner, T.C. Memo.

2005-241 (while acknowledging that the taxpayer had not

challenged the validity of section 301.6330-1(e)(3), Q&A-E2,

Proced. & Admin. Regs., noting that the taxpayer was afforded

several opportunities to dispute his tax liability

administratively).    We have also previously held, in a Court-

reviewed Opinion, that a taxpayer who has self-assessed a

liability has not had the opportunity to dispute his tax

liability and may raise the underlying liability in a collection

review proceeding.    See Montgomery v. Commissioner, 122 T.C. 1, 9

(2004) (noting that the taxpayers had not had “an opportunity to

‘dispute’ their tax liability * * * in any sense of the term”).

Finally, while not binding on this Court, we note that many

District Courts have held that a taxpayer is precluded from

raising the underlying liability where he was provided with an

opportunity for a conference with Appeals.    See, e.g., Abu-Awad

v. United States, 294 F. Supp. 2d 879 (S.D. Tex. 2003) (finding

penalty abatement request was sufficient opportunity to dispute

underlying tax liability for purposes of section 6330(c)(2)(B));

Pelliccio v. United States, 253 F. Supp. 2d 258 (D. Conn. 2003)

(holding that a taxpayer who was notified of his liability and
                               - 7 -

offered an opportunity for an Appeals hearing, could not dispute

the liability again in a collection review hearing).

     We have not, however, previously addressed the validity of

section 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs., and

must do so in order to resolve respondent’s summary judgment

motion.   We begin our analysis with the statutory language.

     Section 6330 was enacted as part of the Internal Revenue

Service Restructuring and Reform Act of 1998, Pub. L. 105-206,

sec. 3401, 112 Stat. 746 (the Restructuring and Reform Act).

Section 6330 generally provides that respondent cannot proceed

with the collection of a person’s taxes by levy until the person

has been given notice and the opportunity for an administrative

review of the matter (in the form of an Appeals Office hearing)

and, if dissatisfied, with judicial review of the administrative

determination.   See Davis v. Commissioner, 115 T.C. 35, 37

(2000); Goza v. Commissioner, 114 T.C. 176, 179 (2000).   Section

6330(d) provides for judicial review of the administrative

determination in the Tax Court or a Federal District Court, as

may be appropriate.3




     3
      Sec. 6330(d)(1) has now been amended to provide for
judicial review of the administrative hearing exclusively in the
Tax Court. Pension Protection Act of 2006, Pub. L. 109-280, sec.
855(a), 120 Stat. 1019 (effective for determinations made more
than 60 days after the date of enactment).
                               - 8 -

     Section 6330(c) prescribes the matters that a person may

raise at an Appeals Office hearing.     Section 6330(c)(2)(A)

provides that a person may raise collection issues such as

spousal defenses, the appropriateness of respondent's intended

collection action, and possible alternative means of collection.

See Sego v. Commissioner, 114 T.C. 604, 609 (2000); Goza v.

Commissioner, supra.   Section 6330(c)(2)(B) establishes

circumstances under which a person may challenge the existence or

amount of his or her underlying tax liability.     Under section

6330(c)(4), however, a person is prohibited from raising in a

collection review proceeding an issue that was raised and

considered at a previous administrative or judicial proceeding if

the person seeking to raise the issue “participated meaningfully”

in such hearing or proceeding.4

     Because respondent has not argued section 6330(c)(4) as a

basis for summary judgment, we decide this matter solely with

respect to petitioner’s ability to raise his underlying liability

pursuant to section 6330(c)(2)(B).     Section 6330(c)(2)(B)



     4
       Respondent has previously stated that “Because section
6330(c)(2)(B) explicitly applies to challenges to tax liability,
section 6330(c)(4) with its more stringent requirement of
meaningful participation applies to non-liability issues.”
Office of Chief Counsel Notice CC-2003-016 at 20 (May 29, 2003).
While not clear whether respondent continues to adhere to this
limited interpretation of sec. 6330(c)(4), respondent has not
argued sec. 6330(c)(4) as a basis to preclude review of the
underlying liability in this case. See Office of Chief Counsel
Notice CC-2006-019 at 33 (Aug. 18, 2006) (updating and replacing
Office of Chief Counsel Notice CC-2003-016 and merely restating
the language of sec. 6330(c)(4)).
                                  - 9 -

provides:

     (2).   Issues at hearing.--

     *       *       *        *           *   *      *

          (B) Underlying liability.--The person may also
     raise at the hearing challenges to the existence or
     amount of the underlying tax liability for any tax
     period if the person did not receive any statutory
     notice of deficiency for such tax liability or did not
     otherwise have an opportunity to dispute such tax
     liability.

     Respondent has promulgated regulations regarding section

6330(c)(2)(B) pursuant to his authority under section 7805(a).

Section 301.6330-1(e), Proced. & Admin. Regs., provides in

pertinent part:

          (e) Matters considered at CDP hearing.--(1) In
     general. * * * The taxpayer also may raise challenges
     to the existence or amount of the tax liability
     specified on the CDP Notice for any tax period shown on
     the CDP Notice if the taxpayer did not receive a
     statutory notice of deficiency for that tax liability
     or did not otherwise have an opportunity to dispute
     that tax liability. * * *


Section 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.,

provides in pertinent part:

          (3) Questions and answers. The questions and
     answers illustrate the provisions of this paragraph (e)
     as follows:

     *       *       *        *           *   *      *

          Q-E2. When is a taxpayer entitled to challenge
     the existence or amount of the tax liability specified
     in the CDP Notice?

          A-E2. A taxpayer is entitled to challenge the
     existence or amount of the tax liability specified in
                              - 10 -

     the CDP Notice if the taxpayer did not receive a
     statutory notice of deficiency for such liability or
     did not otherwise have an opportunity to dispute such
     liability. Receipt of a statutory notice of deficiency
     for this purpose means receipt in time to petition the
     Tax Court for a redetermination of the deficiency
     asserted in the notice of deficiency. An opportunity to
     dispute a liability includes a prior opportunity for a
     conference with Appeals that was offered either before
     or after the assessment of the liability.[5]

     Where, as here, respondent has promulgated interpretive

regulations with respect to a statutory provision, we have

generally applied the analysis set forth by the Supreme Court in

National Muffler Dealers Association, Inc. v. United States, 440

U.S. 472 (1979).   Under National Muffler, an interpretive

regulation is valid if it implements a congressional mandate in a

reasonable manner.   Id. at 476-477.   An interpretive regulation




     5
      The regulations have been amended, and the answer A-E2 now
provides:

     A taxpayer is entitled to challenge the existence or
     amount of the underlying liability for any tax period
     specified on the CDP Notice if the taxpayer did not
     receive a statutory notice of deficiency for such
     liability or did not otherwise have an opportunity to
     dispute such liability. Receipt of a statutory notice
     of deficiency for this purpose means receipt in time to
     petition the Tax Court for a redetermination of the
     deficiency determined in the notice of deficiency. An
     opportunity to dispute the underlying liability
     includes a prior opportunity for a conference with
     Appeals that was offered either before or after the
     assessment of the liability. An opportunity for a
     conference with Appeals prior to the assessment of a
     tax subject to deficiency procedures is not a prior
     opportunity for this purpose.

Sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. (applicable
to requests for hearings on or after November 16, 2006).
                                - 11 -

is reasonable if it “harmonizes with the plain language of the

statute, its origin, and its purpose.”    Id. at 477.

      Following its decision in National Muffler, the Supreme

Court decided Chevron U.S.A., Inc. v. Natural Res. Def. Council,

Inc., 467 U.S. 837 (1984).   In Chevron, the Court stated that

when reviewing an agency’s regulatory implementation of a

statute, we look first to whether Congress has directly spoken to

the precise question at issue.    Id. at 842.   If congressional

intent is clear, our inquiry ends, and we apply the unambiguously

expressed intent of Congress.    Id. at 842-843.   However, if

congressional intent is not clear, the question is whether the

regulation is based on a permissible construction of the statute.

Id.

      This Court has, on a number of occasions, considered

Chevron’s effect on National Muffler and the review of

interpretive tax regulations.    See, e.g., Swallows Holding, Ltd.

v. Commissioner, 126 T.C. 96, 131 (2006) (discussing the review

of Federal tax regulations under National Muffler in relation to

Chevron and stating that Chevron restated National Muffler in a

more practical two-part test); Cent. Pa. Sav. Association & Subs.

v. Commissioner, 104 T.C. 384, 392 (1995) (same) (noting the

Supreme Court’s application of National Muffler after Chevron).

Whether our analysis is guided by National Muffler or by Chevron,

the result would be the same.
                                - 12 -

     In evaluating the validity of section 301.6330-1(e)(3), Q&A-

E2, Proced. & Admin. Regs., we first consider whether Congress

has spoken directly to the precise question at issue.     In

answering this question, we are instructed not to confine our

examination to a particular statutory provision in isolation.

Square D Co. & Subs. v. Commissioner, 118 T.C. 299, 308 (2002)

(citing FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,

133 (2000)), affd. 438 F.3d 739 (7th     Cir. 2006).   The meaning,

or ambiguity, of certain words or phrases may become evident only

when placed in context.     FDA v. Brown & Williamson Tobacco Corp.,

supra at 132-133 (citing Brown v. Gardner, 513 U.S. 115, 118

(1994)).   It is a “‘fundamental canon of statutory construction

that the words of a statute must be read in their context and

with a view to their place in the overall statutory scheme.’”

Id. (quoting Davis v. Mich. Dept. of Treasury, 489 U.S. 803, 809

(1989)).

     Neither the Restructuring and Reform Act nor the Code

defines what is meant by “otherwise have an opportunity to

dispute” a tax liability.    Further, a fair reading of the section

suggests different possible meanings.    On the one hand, it can be

read to mean an opportunity to challenge the underlying liability

in a forum ultimately subject to judicial review.      On the other

hand, it can be read to include challenges subject to judicial

review as well as challenges heard by respondent’s Appeals Office
                              - 13 -

in circumstances where no subsequent prepayment judicial review

of the determination is available.     We examine these competing

possibilities in turn.

     As this Court has often stated, receipt of a notice of

deficiency serves as a taxpayer’s ticket to the Tax Court.        See,

e.g., Manko v. Commissioner, 126 T.C. 195, 200 (2006); Bourekis

v. Commissioner, 110 T.C. 20, 26 (1998).     For income, estate, and

certain excise taxes, respondent cannot assess a deficiency

before first issuing a notice of deficiency.     Sec. 6213(a).6

Upon receipt, the notice of deficiency entitles a taxpayer to

petition this Court to have a Judge, and not the Commissioner,

review his or her tax liability de novo prior to the assessment

and collection of the tax.   See Manko v. Commissioner, supra.

Thus, pursuant to section 6330(c)(2)(B), a taxpayer who actually

received a notice of deficiency may not raise the underlying

liability again in a collection review proceeding because he has

previously litigated the liability, by petitioning this Court, or

declined such an opportunity to litigate the liability, by

failing to petition this Court.




     6
      This case does not involve a deficiency determination
requiring respondent to issue a notice of deficiency under sec.
6212 on which assessment is restricted by sec. 6213.
Accordingly, we do not address the applicability of sec.
301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs., and the phrase
“otherwise have an opportunity” in sec. 6330(c)(2), to situations
requiring a notice of deficiency.
                              - 14 -

     A notice of deficiency is not, however, the only ticket to

the Tax Court.   In other contexts, a taxpayer may enjoy

prepayment judicial review of a tax liability without having been

issued a notice of deficiency.    For instance, with respect to the

Commissioner’s classification of individuals as employees for

purposes of employment taxes, an employer is afforded a process

akin to the deficiency procedures.7    Sec. 7436(d).   In these

cases, where the Commissioner seeks to reclassify individuals as

employees, he may issue a notice of determination with respect to

the employment classification to the employer.    Sec. 7436(b).

This notice of determination entitles a taxpayer to petition this

Court for de novo review of the employee classification as well

as the proper amount of tax owing from this classification.       Sec.

7436(a) and (b).   A taxpayer may also seek prepayment review in

this Court of a request for an abatement of interest.     Sec.

6404(h)(1).   A taxpayer might also be afforded prepayment

judicial review of a tax liability in a bankruptcy proceeding.

11 U.S.C. sec. 505(a) (2000); see also Sabath v. Commissioner,

T.C. Memo. 2005-222.

     Thus, it is possible to interpret “otherwise have an

opportunity to dispute” to refer to those situations where a

taxpayer was afforded one of the other, nondeficiency, avenues

for prepayment judicial review.   Accordingly, reading section



     7
       For this purpose, employment taxes are those taxes imposed
under subtit. C.
                               - 15 -

6330(c)(2)(B) as a whole, one might conclude that Congress

intended only for taxpayers who previously litigated, or were

afforded the opportunity to litigate their tax liabilities, by

receipt of a notice of deficiency or otherwise, to be precluded

from once again raising the underlying tax liability in a

collection review hearing.    In other words, by enacting the

collection review procedures, Congress intended that every

taxpayer have one prepayment opportunity to litigate his tax

liability before the Commissioner brings his collection authority

to bear.

       Such an interpretation finds some support in the legislative

history of the Restructuring and Reform Act.    Section 6330

originated in section 3401 of the Senate version of H.R. 2676,

the bill that, after amendment, was enacted as the Restructuring

and Reform Act.    The predecessor of section 6330(c)(2)(B) in the

Senate version provided without limitation that a taxpayer could

raise in a section 6330 proceeding “challenges to the underlying

tax liability as to existence or amount.”    H.R. 2676, sec.

3401(b), 105th Cong., 2d Sess. (1998), 144 Cong. Rec. S4163

(daily ed. May 4, 1998).    Judicial review of all collection

review determinations, including those regarding the underlying

liability, was to be conducted on an abuse of discretion

standard.    S. Rept. 105-174, at 68 (1998), 1998-3 C.B. 537, 603-

604.
                               - 16 -

     The expansive Senate version provoked responses from the

Department of the Treasury and other representatives of the

executive branch expressing concerns that under the Senate bill a

taxpayer could dispute, in a collection review proceeding, tax

liabilities that had been previously litigated.   See Statement of

Administration Policy, Executive Office of the President (Office

of Management and Budget), on H.R. 2676--Internal Revenue Service

Restructuring and Reform Act (Reported by the Senate Committee on

Finance) (May 5, 1998), reprinted in Tax Notes Today, 98 TNT

87-18 (May 6, 1998); Letter from Robert E. Rubin, Secretary of

the Treasury to William Archer, Chairman, Committee on Ways &

Means, U.S. House of Representatives (June 2, 1998), reprinted in

Tax Notes Today, 98 TNT 112-40 (June 11, 1998).

     The final version of the legislation, devised in conference,

added the language that a person may challenge the existence or

amount of the underlying liability for any tax period “if such

person did not receive any statutory notice of deficiency for

such tax liability or did not otherwise have an opportunity to

dispute such tax liability.”   While there is nothing explicit in

the committee reports to explain the added limitation, it is

reasonable to conclude that the conference committee was

addressing the stated criticisms of allowing taxpayers multiple

opportunities for judicial review of their tax liability.   See

Montgomery v. Commissioner, 122 T.C. at 17 (Gale, J.,
                               - 17 -

concurring).    Thus, it would follow that the language adopted by

the conference committee was meant to limit those taxpayers who

have previously litigated the underlying liability or declined

the opportunity to do so after receiving a notice of deficiency

or otherwise.   Of course, if this were Congress’s intent,

petitioner would not be precluded from raising his liability here

because, while he has had the opportunity for an Appeals Office

hearing, he has not had a prior opportunity to litigate his

underlying tax liability.

     This interpretation, however, is not without problems.

First, if Congress were concerned only with preventing taxpayers

from enjoying multiple opportunities to litigate their tax

liability, it certainly did not make this intent clear.   That is,

if this were truly the limit of Congress’s intent, it could have

expressed this by stating in simple terms that a person may

challenge the existence or amount of the underlying liability if

the person had not previously had the opportunity to seek

judicial review of the underlying liability.

     To interpret section 6330(c)(2)(B) to mean every taxpayer

gets one precollection opportunity to litigate his underlying tax

liability would serve to overturn the tax collection scheme as it

existed prior to the enactment of the Restructuring and Reform

Act where many tax liabilities were not subject to any prepayment

judicial review.   For instance, with respect to section 6651,
                              - 18 -

6654, and 6655 additions to tax which are unrelated to a

deficiency, respondent may assess the liability without first

issuing a notice of deficiency.   Sec. 6665(b); see also sec.

6672(a) (trust fund fraud recovery penalty); sec. 6694 (income

tax return preparer penalty); sec. 6205(b) (employment taxes).

In each of these contexts there is no prescribed process for

prepayment judicial review provided by the Code.8   Thus, a

taxpayer faced with such a liability must first pay the

liability, or a divisible portion thereof, before seeking court

review in a refund action.   See Flora v. United States, 362 U.S.

145 (1960) (recognizing exception to requirement of full payment

before refund suit for divisible taxes where taxpayer may pay tax

attributable to one event and then file suit for refund); see

also sec. 6694(c) (allowing suit for refund of tax return

preparer penalty upon payment of 15 percent of the penalty).

     Thus, to hold that every taxpayer is entitled to litigate

his underlying nondeficiency liability once a collection action

is initiated would only encourage a taxpayer to wait until a




     8
      In the context of abatements of additions to tax, such as
those at issue here, prepayment judicial review is restricted by
sec. 6404(b), which provides that “No claim for abatement shall
be filed by a taxpayer in respect of an assessment of any tax
imposed under subtitle A or B.” In contrast, where Congress
desired to allow prepayment judicial review of interest, it has
made this intention clear. Sec. 6404(h) (“The Tax Court shall
have jurisdiction over any action brought * * * to determine
whether the Secretary’s failure to abate interest under this
section was an abuse of discretion”); see also Urbano v.
Commissioner, 122 T.C. 384, 392-395 (2004).
                               - 19 -

collection action begins before disputing the liability.   Such a

concern was raised in Secretary Rubin’s letter to Ways and Means

Committee Chairman Archer, in which he warned that the expansive

Senate bill would “encourage * * * [taxpayers] to ignore their

liability until a collection action begins in earnest”.    Letter

from Robert E. Rubin, supra.    The regulations do not create such

a new remedy for nondeficiency liabilities, and there is nothing

in the Code or the legislative history of the Restructuring and

Reform Act to suggest that this is unreasonable.

     The fact that no prepayment judicial forum is prescribed for

certain tax liabilities does not mean that a taxpayer is without

a forum to dispute these liabilities.   Upon notice and demand for

payment of a tax liability, a taxpayer may seek review of the

liability by filing a protest with the Commissioner’s Appeals

Office.   Secs. 601.103(c), 601.106, Statement of Procedural

Rules.    The Appeals Office then provides a taxpayer with an

informal conference in which he or she may present evidence and

arguments in support of the position disputing the liability.

See sec. 601.106(c), Statement of Procedural Rules.    The Appeals

officer has the “exclusive and final authority” to determine the

liability.   Sec. 601.106(a)(1), Statement of Procedural Rules.

Further, the Appeals procedures provide that the Appeals officer

is duty bound “to determine the correct amount of the tax, with

strict impartiality between the taxpayer and the Government.”
                                - 20 -

Sec. 601.106(f)(2), Statement of Procedural Rules.      Thus, while

not de novo review by a judge, Appeals nonetheless provides a

taxpayer with an opportunity to dispute a tax liability.

       The importance to Congress of a meaningful Appeals process

as part of the overall tax collection scheme is apparent in the

Restructuring and Reform Act.    While the opportunity for Appeals

consideration has long been part of the Commissioner’s collection

scheme, it had not previously been mandated by the Code.      The

Restructuring and Reform Act sec. 1001, 112 Stat. 689, however,

mandates that an independent appeals function exist within the

IRS:

       Reorganization of the Internal Revenue Service

            (a) In General.--The Commissioner of Internal
       Revenue shall develop and implement a plan to
       reorganize the Internal Revenue Service. The plan
       shall--

         *       *       *       *       *       *        *

            (4) ensure an independent appeals function within
       the Internal Revenue Service, including the prohibition
       in the plan of ex parte communications between appeals
       officers and other Internal Revenue Service employees
       to the extent that such communications appear to
       compromise the independence of the appeals officers.

Furthering this mandate, Senator Roth, Chairman of the Senate

Committee on Finance, explained in his statement introducing the

Restructuring and Reform Act for Senate debate:

       One of the major concerns we heard throughout our
       oversight initiative was that the taxpayers who get
       caught in the IRS hall of mirrors have no place to turn
       that is truly independent and structured to represent
                              - 21 -

     their concerns. This legislation requires the agency
     to establish an independent Office of Appeals--one that
     may not be influenced by tax collection employees or
     auditors.
          Appeals officers will be made available in every
     state, and they will be better able to work with
     taxpayers who proceed through the appeals process.

144 Cong. Rec. 14689 (1998) (Statement of Senator Roth). This

suggests that Congress intended the Restructuring and Reform Act

to result in an Appeals function that acted as something more

than just a rubber stamp for the Commissioner’s determinations.

     The importance of the Appeals process in resolving disputes

is also apparent because Congress, as part of the Restructuring

and Reform Act, directed respondent to develop alternative

dispute resolution procedures.   Thus, section 7123(b) now

mandates:

          SEC. 7123(b).   Alternative Dispute Resolution
     Procedures.--

          (1) Mediation.-- The Secretary shall prescribe
     procedures under which a taxpayer or the Internal
     Revenue Service Office of Appeals may request non-
     binding mediation on any issue unresolved at the
     conclusion of--

               (A)   appeals procedures; * * *

Respondent has now developed procedures whereby a taxpayer can

request mediation of factual and legal issues after settlement

discussions with the Appeals Office have proved unsuccessful.

Rev. Proc. 2002-44, 2002-2 C.B. 10; see also Rev. Proc. 2006-44,

2006-44 I.R.B. 800 (establishing arbitration procedures to

resolve certain factual disputes).
                             - 22 -

     These provisions of the Restructuring and Reform Act make

clear that Congress was concerned with providing taxpayers a

meaningful process, short of litigation, in which they could

resolve tax disputes with respondent.   Thus, reading section

6330(c)(2)(B) in this context, it is reasonable to conclude that

Congress intended not only to address those taxpayers who were

previously provided an opportunity to litigate their liability,

but also those provided an opportunity to dispute the liability

short of litigation.

     Ultimately, while it is possible to interpret section

6330(c)(2)(B) to mean that every taxpayer is entitled to one

opportunity for a precollection judicial review of an underlying

liability, we find it unlikely that this was Congress’s intent.

As we see it, if Congress had intended to preclude only those

taxpayers who previously enjoyed the opportunity for judicial

review of the underlying liability from raising the underlying

liability again in a collection review proceeding, the statute

would have been drafted to clearly so provide.   The fact that

Congress chose not to use such explicit language leads us to

believe that Congress also intended to preclude taxpayers who

were previously afforded a conference with the Appeals Office

from raising the underlying liabilities again in a collection

review hearing and before this Court.
                                - 23 -

      Thus, in view of the statutory scheme as a whole, as well as

the Restructuring and Reform Act specifically, we find

respondent’s interpretation of section 6330(c)(2)(B) to be

reasonable.   National Muffler Dealers Association v. United

States, 440 U.S. at 476-477.    A conference with the Appeals

Office provides a taxpayer a meaningful opportunity to dispute an

underlying tax liability.9

II.   Respondent’s Motion for Summary Judgment

      Summary judgment may be granted where there is no genuine

issue of any material fact and a decision may be entered as a

matter of law.   Rule 121(a) and (b); see Sundstrand Corp. v.

Commissioner, 98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th

Cir. 1994).   The moving party bears the burden of proving that

there is no genuine issue of material fact, and factual

inferences will be read in the manner most favorable to the party

opposing summary judgment.     Dahlstrom v. Commissioner, 85 T.C.

812, 821 (1985).

      We are satisfied that no genuine issues of material fact

exist and judgment as a matter of law is appropriate.    Petitioner



      9
      We reserve judgment today on whether an offer for a
conference with Appeals is sufficient (and if so, what
information would be required to be included in such an offer) to
preclude subsequent collection review consideration if the
taxpayer declines the offer without participating in such a
conference. We note, however, that we read sec. 6330(c)(2)(B) to
allow a taxpayer who has had neither a conference with Appeals
nor an opportunity for a conference with Appeals to raise the
underlying liability in a collection review proceeding before
Appeals and this Court.
                                - 24 -

filed his 2002 income tax return on January 25, 2004, and

included payment for the reported tax due of $11,636.    Respondent

then assessed additions to tax of $2,618.10 and $581.80 pursuant

to section 6651(a)(1) and (2).    Petitioner submitted a request

for abatement of the assessed additions to tax.    This request was

referred to respondent’s Appeals Office.    The Appeals officer

then considered the circumstances of petitioner’s late filing,

including correspondence submitted on petitioner’s behalf

explaining that petitioner’s accountant, who possessed

petitioner’s tax records, was hospitalized with stomach cancer

until shortly before petitioner’s 2002 tax return was filed.      The

Appeals officer then determined that reasonable cause to abate

the additions to tax was not present.

     Accordingly, because petitioner had an opportunity, and

availed himself of that opportunity, to dispute the underlying

tax liability in a conference with the Appeals Office, he may not

raise that underlying liability again in a collection review

hearing or before this Court.    Sec. 6330(c)(2)(B); sec. 301.6330-

1(e)(3), Q&A-E2, Proced. & Admin. Regs.

     Petitioner has not raised any issues, other than the

underlying liability, in opposition to respondent’s proposed
                             - 25 -

collection action in his petition.    Therefore, for the reasons

stated, we shall grant respondent’s motion for summary judgment.

     To reflect the foregoing,



                                          An appropriate order and

                                     decision will be entered for

                                     respondent.
