                  T.C. Summary Opinion 2003-152



                      UNITED STATES TAX COURT



          OLEN W. AND GWENDOLYN WILBORN, Petitioners v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 6805-02S.           Filed October 15, 2003.


     Olen W. and Gwendolyn Wilborn, pro sese.

     John F. Driscoll, for respondent.



     WHERRY, Judge:   This case is before the Court on

respondent’s Motion For Summary Judgment under Rule 121.1     The

petition was filed pursuant to the provisions of section 7463.

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

and this opinion should not be cited as authority.   The instant

proceeding arises from a petition for judicial review filed in

     1
       Unless otherwise indicated, section references are to the
Internal Revenue Code of 1986, as amended, and Rule references
are to the Tax Court Rules of Practice and Procedure.
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response to a Notice of Determination Concerning Collection

Action(s) Under Section 6320 and/or 6330.

                            Background

     On April 12, 1999, respondent assessed $1,846.02 pertaining

to petitioners’ Federal income tax liabilities for the 1996 year.

Thereafter, on February 25, 2000, respondent issued to

petitioners separate identical notices of deficiency for the

taxable year 1997.   The notices reflected a deficiency of $24,773

and an accuracy-related penalty under section 6662(a) of $4,234.

The notices were sent by certified mail to petitioners at P.O.

Box 425, Magee, Mississippi 39111-0425-257.    In response to the

notices of deficiency, petitioners apparently prepared a petition

to the Tax Court for redetermination.    They attached to their

pleadings in the instant collection case a copy of a petition

with respect to the deficiency signed and dated March 18, 2000.

Such a petition, however, was never in fact filed with this

Court, and no deficiency proceedings were instituted.    Respondent

assessed an unpaid balance of $34,760.65 with respect to 1997 on

July 17, 2000.

     On or about December 5, 2000, respondent issued to

petitioners a Final Notice - Notice of Intent to Levy and Notice

of Your Right to a Hearing with regard to their 1996 and 1997

taxable years.   Subsequently, on March 29, 2001, respondent sent

to petitioners separate Notices of Federal Tax Lien Filing and
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Your Right to a Hearing Under IRC 6320 with respect to the 1996

and 1997 years.

     Petitioners then submitted a Form 12153, Request for a

Collection Due Process Hearing, which was received by respondent

on April 27, 2001.   On the Form 12153 petitioners checked boxes

indicating disagreement with both a “Filed Notice of Federal Tax

Lien” and a “Notice of Levy/Seizure”.   They also attached a

statement explaining that their reasons for disagreeing included

that they were never given the Tax Court hearing they requested

on March 18, 2000, and that they primarily disputed the

disallowance in its entirety of $53,541 claimed in 1997 as cost

of good sold.

     In response to that portion of petitioners’ request which

related to the notice of intent to levy, respondent held a so-

called equivalency hearing and, on January 24, 2002, issued a

Decision Letter Concerning Equivalent Hearing Under Section 6320

and/or 6330 concluding that the subject levy was an appropriate

collection action.   In response to that portion of petitioners’

request which pertained to the notices of lien filing, respondent

held a “Collection Due Process” hearing and sent to petitioners a

Notice of Determination Concerning Collection Actions(s) Under

Section 6320 and/or 6330 dated February 28, 2002.   An attachment

to the notice of determination explained in relevant part as

follows:
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          In their protest Taxpayer stated that they did not
     agree with the lien filing because they were never
     given a Tax Court hearing in Mobile, AL as they had
     requested in a timely filed petition. Taxpayer
     provided a copy of the petition that was mailed to the
     Tax Court. In their petition Taxpayer had disagreed
     with the audit adjustment to disallow the cost of good
     sold in its entirety. It was decided to give the
     Taxpayer the benefit of a doubt and consider the cost
     of good sold issue. Taxpayer provided documentation to
     substantiate material cost of $31,365.45. The SND was
     revised to reflect the allowance of the COGS. This
     adjustment reduces the amount of tax owed for 1997 from
     $24,773 to $12,478 and the penalty associated with the
     adjustment to be abated is $4,234.

          Taxpayer was told of the recommendation to reduce
     the liability for 1997. Taxpayer-wife had stated
     several times that she was going to try and borrow some
     money to pay part of the liability and set the balance
     on payments. A copy of the revised audit report was
     mailed to Taxpayer along with the Form 12257.
     Taxpayer-wife called to discuss the form and was given
     two weeks to sign and return the waiver or a
     determination letter would be issued.

          From the best information available it appears
     that all required legal procedures were followed by the
     Internal Revenue Service in issuing the Notice of
     Federal Tax Lien and advising Taxpayer of their Appeal
     right. Taxpayer had raised the liability issue for one
     year, which was considered. The Notice of Federal Tax
     Lien should not be withdrawn. The lien was properly
     file to secure the Government’s priority position.
     This action balances the need for the efficient
     collection of taxes with the legitimate concern that
     any collection action be no more intrusive than
     necessary. [Reproduced literally.]

     On March 29, 2002, petitioners filed with this Court a

petition that on its face challenges the “Notice of Determination

- 2/28/02” with respect to the year “1997”.   Attached to the

petition is an explanation of petitioners’ position which

mentions once again the lack of a Tax Court proceeding in
                                - 5 -

response to their 2000 petition; acknowledges that respondent

considered and allowed at the “Collection Due Process Hearing” a

portion of the disputed cost of goods sold; argues that

respondent did not consider other issues that petitioners wished

to raise, such as deductions in 1997 for gambling losses, State

income taxes, and mortgage interest; and contends that “a levy

against petitioners’ current income would indeed be ‘more

intrusive than necessary.’”    Petitioners then allude to several

items of real property and state:    “What the petitioners want is

for the levy against current earnings to be delayed until the

correct amount of deficit has been determined and until they can

sell the property or mortgage it to pay the deficit.”   The

attachment also clarifies that “petitioners are not challenging

any of the $1,846 alleged to be owed for 1996”.

     Respondent on July 18, 2003, filed a Motion To Dismiss For

Lack of Jurisdiction As To Petitioners’ I.R.C. § 6330(a) Claim.

The Court granted respondent’s motion on grounds that

petitioners’ request for a hearing as to the levy was not timely

submitted to respondent within the time period prescribed by

statute.   See sec. 6330(a)(3)(B); Kennedy v. Commissioner, 116

T.C. 255, 261-262 (2001).   Respondent on September 15, 2003,

filed the instant motion for summary judgment.    Petitioners were

ordered to file any response to this motion on or before October

6, 2003, but no such response has been received by the Court.

                              Discussion
                                  - 6 -

      Rule 121(a) allows a party to move “for a summary

adjudication in the moving party’s favor upon all or any part of

the legal issues in controversy.”     Rule 121(b) directs that a

decision on such a motion shall be rendered “if the pleadings,

answers to interrogatories, depositions, admissions, and any

other acceptable materials, together with the affidavits, if any,

show that there is no genuine issue as to any material fact and

that a decision may be rendered as a matter of law.”

      The moving party bears the burden of demonstrating that no

genuine issue of material fact exists and that he or she is

entitled to judgment as a matter of law.       Sundstrand Corp. v.

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

Cir. 1994).   Facts are viewed in the light most favorable to the

nonmoving party.     Id.   However, where a motion for summary

judgment has been properly made and supported by the moving

party, the opposing party may not rest upon mere allegations or

denials contained in that party’s pleadings but must by

affidavits or otherwise set forth specific facts showing that

there is a genuine issue for trial.       Rule 121(d).   The Court has

considered the pleadings and other materials in the record and

concludes that there is no genuine justiciable issue of material

fact in this case.

I.   Collection Actions--General Rules

      Section 6321 imposes a lien in favor of the United States

upon all property and rights to property of a taxpayer where
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there exists a failure to pay any tax liability after demand for

payment.   The lien generally arises at the time assessment is

made.   Sec. 6322.   Section 6323, however, provides that such lien

shall not be valid against any purchaser, holder of a security

interest, mechanic’s lienor, or judgment lien creditor until the

Secretary files a notice of lien with the appropriate public

officials.   Section 6320 then sets forth procedures applicable to

afford protections for taxpayers in lien situations.

     Section 6320(a)(1) establishes the requirement that the

Secretary notify in writing the person described in section 6321

of the filing of a notice of lien under section 6323.      This

notice required by section 6320 must be sent not more than 5

business days after the notice of tax lien is filed and must

advise the taxpayer of the opportunity for administrative review

of the matter in the form of a hearing before the Internal

Revenue Service Office of Appeals.      Sec. 6320(a)(2) and (3).

Section 6320(b) and (c) grants a taxpayer, who so requests, the

right to a fair hearing before an impartial Appeals officer,

generally to be conducted in accordance with the procedures

described in section 6330(c), (d), and (e).

     Section 6330(c) addresses the matters to be considered at

the hearing:

          SEC. 6330(c). Matters Considered at Hearing.--In
     the case of any hearing conducted under this section--

                (1) Requirement of investigation.--The
           appeals officer shall at the hearing obtain
                                 - 8 -

          verification from the Secretary that the
          requirements of any applicable law or
          administrative procedure have been met.

                  (2) Issues at hearing.--

                       (A) In general.--The person may raise at
                  the hearing any relevant issue relating to
                  the unpaid tax or the proposed levy,
                  including--

                            (i) appropriate spousal defenses;

                            (ii) challenges to the
                       appropriateness of collection actions;
                       and

                            (iii) offers of collection
                       alternatives, which may include the
                       posting of a bond, the substitution of
                       other assets, an installment agreement,
                       or an offer-in-compromise.

                       (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.

     Once the Appeals officer has issued a determination

regarding the disputed collection action, section 6330(d) allows

the taxpayer to seek judicial review in the Tax Court or a U.S.

District Court.    In considering whether taxpayers are entitled to

any relief from the Commissioner’s determination, this Court has

established the following standard of review:

     where the validity of the underlying tax liability is
     properly at issue, the Court will review the matter on
     a de novo basis. However, where the validity of the
     underlying tax liability is not properly at issue, the
     Court will review the Commissioner’s administrative
                                - 9 -

      determination for abuse of discretion. [Sego v.
      Commissioner, 114 T.C. 604, 610 (2000).]

II.   Review of Underlying Liability

      Petitioners seek to challenge in this proceeding the amount

of their underlying tax liability for 1997.    The record, however,

makes clear that petitioners received a notice of deficiency for

1997.   Identical notices were sent to what respondent alleges and

petitioners do not dispute was their last known address.      See

sec. 6212(b).   That address is the same address as petitioners

have indicated to the Court should be used for correspondence in

connection with this case.   Moreover, petitioners in fact

received one or both of the statutory notices in time to prepare

and sign on March 18, 2000, a timely Tax Court petition.      See

sec. 6213(a).   The reason why this petition was never actually

filed with the Court is not explained by the record, but it is

clear that petitioners failed to follow up adequately on their

submission to ensure its receipt and filing.

      Accordingly, because a statutory notice of deficiency for

1997 was received by petitioners, they are precluded by section

6330(c)(2)(B) from challenging their underlying liability for

that year in this proceeding.   Furthermore, this preclusion

mandated by statute is not altered or waived by the fact that the

Appeals officer chose to consider at the collection hearing

matters related to petitioners’ liability.    See Behling v.

Commissioner, 118 T.C. 572, 577-579 (2002).    Petitioners’
                                - 10 -

contentions regarding items such as deductions for 1997 are not

properly at issue and cannot be addressed here.     Petitioners have

also expressly conceded any challenge to the balance due for

1996.     We therefore review respondent’s determination solely for

abuse of discretion.

III.    Review for Abuse of Discretion

        With respect to issues subject to review in collection

proceedings for abuse of discretion, petitioners have at no time

raised a spousal defense.     Nor have they offered any specific,

concrete collection alternatives.     Although petitioners in their

petition generally allude to the possibility of selling or

mortgaging real property, they have not proposed any actual plan

or arrangements for satisfying their tax liabilities.     They also

apparently broached at their Appeals hearing but failed to follow

through on borrowing funds to pay a portion of the debt.     Hence,

the record does not reveal that respondent inappropriately

rejected any bona fide collection alternative.

        Concerning challenges to the appropriateness of collection

actions, the petition complains about intrusiveness.     To the

extent that this complaint pertains to the levy action, the issue

is not before us.     To the extent that the complaint can be

interpreted to encompass the lien action, we conclude that, in

light of the absence of any definite collection alternatives, the

filing of a lien properly balances the competing concerns of

efficient collection and intrusiveness.
                              - 11 -

     As this Court has noted in earlier cases, Rule 331(b)(4)

states that a petition for review of a collection action shall

contain clear and concise assignments of each and every error

alleged to have been committed in the notice of determination and

that any issue not raised in the assignments of error shall be

deemed conceded.   See Lunsford v. Commissioner, 117 T.C. 183,

185-186 (2001); Goza v. Commissioner, 114 T.C. 176, 183 (2000).

Accordingly, having considered those matters set forth in

petitioners’ pleadings, the Court concludes that respondent’s

determination to proceed with collection was not an abuse of

discretion.   Respondent’s motion for summary judgment will be

granted.
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To reflect the foregoing,


                                  An appropriate order

                             granting respondent’s motion

                             for summary judgment and

                             decision for respondent will

                             be entered.
