                      T.C. Memo. 2009-259



                     UNITED STATES TAX COURT



             RONALD DAVID STINCHCOMB, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 29690-07L.           Filed November 10, 2009.



     Ronald David Stinchcomb, pro se.

     Jennifer Martwick, for respondent.



                        MEMORANDUM OPINION


     WELLS, Judge:   Petitioner seeks review, pursuant to section

6330(d),1 of respondent’s determination regarding a lien filed

with respect to petitioner’s Federal income taxes for 2001 and

2002 and a trust fund recovery penalty for the period ended


     1
      Unless otherwise indicated, section references are to the
applicable versions of the Internal Revenue Code.
                                 -2-

September 30, 2002.    We must decide whether respondent’s

settlement officer abused her discretion in determining to reject

petitioner’s offer-in-compromise and upholding the filing of the

lien regarding petitioner’s liabilities.

     The parties stipulated certain facts and exhibits.      We

incorporate herein the parties’ stipulations of fact, which are

found accordingly.    When the petition was filed, petitioner

resided in Georgia.

     On March 19, 2004, petitioner filed a Federal income tax

return for his 2001 taxable year.      The return reported a tax

liability of $7,738 and a withholding credit of $3,638.

Petitioner did not pay the tax balance due of $4,100.      On July

26, 2004, respondent assessed the tax, plus a delinquency

addition to tax pursuant to section 6651(a)(1) of $922.50, a

failure to pay addition to tax pursuant to section 6651(a)(2) of

$574, and interest of $614.53.    As of November 12, 2008,

petitioner’s outstanding tax liability for taxable year 2001,

including accrued interest, was $7,781.94.

     On March 19, 2004, petitioner filed a Federal income tax

return for his 2002 taxable year.      The return reported a tax

liability of $9,164 and a withholding credit of $2,167.

Petitioner did not pay the tax balance due of $6,997.      On June 7,

2004, respondent assessed the tax, plus an estimated tax addition

to tax pursuant to section 6654 of $218, a delinquency addition
                                 -3-

to tax pursuant to section 6651(a)(1) of $1,574.32, a failure to

pay addition to tax pursuant to section 6651(a)(2) of $419.86,

and interest of $394.71.    That same day, respondent abated the

estimated addition to tax of $218, along with the delinquency

addition to tax of $224.77.    As of November 12, 2008,

petitioner’s outstanding tax liability for taxable year 2002,

including accrued interest, was $7,240.43.

     On June 21, 2004, respondent assessed against petitioner a

trust fund recovery penalty (TFRP) of $2,741.77 for the period

ended September 30, 2002.    The TFRP was assessed against

petitioner as a responsible party for the employment tax

liabilities of Driver Recruiting Services, Inc.    As of November

12, 2008, petitioner’s outstanding tax liability for the TFRP had

been paid in full.

     On or about September 9, 2004, petitioner entered into an

installment agreement (installment agreement) with the Internal

Revenue Service (IRS) requiring petitioner to pay $125 per month.

The installment agreement applied to the tax years and the tax

period originally in issue in the instant case.    Petitioner made

monthly payments pursuant to the installment agreement of $125

through June 2006.
                                 -4-

     On or about August 28, 2006, the installment agreement was

defaulted.2    On June 1, 2007, respondent sent petitioner a Notice

of Federal Tax Lien Filing and Your Right to a Hearing Under IRC

6320 (NFTL) with respect to petitioner’s income tax liabilities

for the taxable periods in issue.      On June 27, 2007, petitioner

and the IRS entered into a new installment agreement (new

installment agreement) for $286 per month.3

     On July 9, 2007, petitioner submitted to the IRS a Form

12153, Request for a Collection Due Process Hearing, with

respect to the NFTL.    In his hearing request, petitioner checked

the boxes for installment agreement and offer-in-compromise.

Additionally, petitioner checked the boxes requesting lien

subordination, discharge, and withdrawal and stated that he

disagreed with the lien filing because “My home is still under

construction and this lien will be a hardship--IRS did not follow

procedures.”

     By letter dated October 15, 2007, the settlement officer

assigned to petitioner’s case (settlement officer) informed

petitioner that she had scheduled a telephone conference for


     2
      Respondent’s records show “status 61 defaulting IA”,
which, according to respondent, indicates that petitioner was in
default on the installment agreement after petitioner missed the
payment deadlines for two payments.
     3
      Petitioner made monthly payments pursuant to the new
installment agreement of $286 through May 2008, at which time
petitioner stopped making the payments because he could no longer
afford to make them.
                                 -5-

November 13, 2007.    The settlement officer also noted that

petitioner checked the lien subordination, discharge and

withdrawal boxes on his request for hearing and informed

petitioner that he needed to follow the instructions in

Publication 784, How to Prepare an Application for a Certificate

of Subordination of Federal Tax Lien, and return the necessary

information to her within 14 days.4    She also stated that

petitioner had not provided any specific information or documents

to show that withdrawal of the NFTL would facilitate the

collection of the tax liabilities or be in the Government’s best

interest.    Finally, the settlement officer advised petitioner

that since he already was on the new installment agreement for

$286 per month, there were no collection alternatives for her to

consider.    She also noted that since it already had been

determined that petitioner had the ability to fully pay his

liabilities through an installment agreement, an offer-in-

compromise could not be considered.

     On November 13, 2007, the settlement officer called

petitioner for the scheduled conference.    The settlement officer

informed petitioner that the Internal Revenue Service (IRS) had

followed all applicable law and administrative procedures in his

case.    Petitioner stated that he could not finish building his


     4
      Petitioner did not return these forms to the settlement
officer.
                                 -6-

home because he could not get any loans on account of the lien.

Petitioner also told the settlement officer that his corporation

had already paid the TFRP for the periods ended June 30 and

September 30, 2002, but the payments had not been applied.    The

settlement officer told petitioner that she would look into the

payment issue for him.   Subsequently, the settlement officer

informed petitioner that she had not found that any payments were

incorrectly applied.   She also informed petitioner that she would

sustain the NFTL.

     On November 28, 2007, respondent issued a Notice of

Determination Concerning Collection Action(s) Under Section 6320

and/or 6330 which sustained the NFTL.   On December 26, 2007,

petitioner filed the petition.

     Where the underlying tax liability is not in issue, we

review the determination of the Appeals Office for abuse of

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

In reviewing for abuse of discretion, we reject the determination

of the Appeals Office only if the determination was arbitrary,

capricious, or without sound basis in fact or law.   See Cox v.

Commissioner, 126 T.C. 237, 255 (2006), revd. 514 F.3d 1119 (10th

Cir. 2008); Murphy v. Commissioner, 125 T.C. 301, 308, 320

(2005), affd. 469 F.3d 27 (1st Cir. 2006).   Petitioner stipulated

that he does not dispute the underlying liabilities.
                                 -7-

Consequently, we review the determination of the Appeals Office

for abuse of discretion.

       Where, as in the instant case, we decide the propriety of

the settlement officer’s rejection of an offer-in-compromise, we

review the reasoning underlying that rejection to decide whether

it was arbitrary, capricious, or without sound basis in fact or

law.    We do not substitute our judgment for that of the

settlement officer, and we do not decide independently the amount

that we believe would be an acceptable offer-in-compromise.     See

Murphy v. Commissioner, supra at 320.

       We generally do not consider arguments, issues, or other

matters raised for the first time at trial, but we limit

our consideration to matters brought to the attention of the

Appeals Office.    See Giamelli v. Commissioner, 129 T.C. 107

(2007); Murphy v. Commissioner, supra at 308; Magana v.

Commissioner, 118 T.C. 488, 493 (2002).    “[E]vidence that * * *

[a taxpayer] might have presented at the section 6330 hearing

(but chose not to) is not admissible in a trial conducted

pursuant to section 6330(d)(1) because it is not relevant to the

question of whether the Appeals officer abused her discretion.”

Murphy v. Commissioner, supra at 315.

       At the time of petitioner’s Appeals hearing, petitioner and

the IRS already had entered into the new installment agreement,

and he was making payments of $286 a month.    At the Appeals
                                -8-

hearing the settlement officer informed petitioner that, since he

already had an installment agreement, there was no collection

alternative for the settlement officer to consider.   The only

argument petitioner advanced was that the lien should not be

sustained because it was preventing him from finishing

construction on his new home.   It was not an abuse of discretion

for the settlement officer to refuse to withdraw the lien because

it interfered with the construction of his home.5

     At trial petitioner did not identify any payments that

should have been, but were not, properly credited to his tax

liabilities.6   It does not appear that petitioner disagrees with

the remaining liabilities.   Petitioner’s main contention appears

to be that the $125 monthly installment agreement should be




     5
      Although petitioner had the new installment agreement
in place at the time of his Appeals hearing, that installment
agreement did not preclude the filing of an NFTL, nor was
respondent required to withdraw the NFTL after the new
installment agreement had become effective. Sec. 6323(j)(1) is
permissive. Although the IRS may withdraw an NFTL pursuant to
sec. 6323(j)(1), failure to do so is not an abuse of discretion.
See Crisan v. Commissioner, T.C. Memo. 2007-67; Ramirez v.
Commissioner, T.C. Memo. 2005-179; Stein v. Commissioner, T.C.
Memo. 2004-124; Dorra v. Commissioner, T.C. Memo. 2004-16.
Accordingly, the settlement officer did not abuse her discretion
by not withdrawing the NFTL.
     6
      Petitioner’s tax liability for 1999 has been paid in
full, and that year has been dismissed as moot. Additionally, as
to the TFRP, the corporation paid the tax for the period ended
June 30, 2002, and that period has been dismissed as moot.
                                 -9-

reinstated.7   However, as the issue of reinstating petitioner’s

installment agreement was not raised with the settlement officer

at petitioner’s hearing, we will not consider it.        The settlement

officer considered all of petitioner’s contentions, verified

compliance by the IRS with all applicable laws and regulations,

and considered whether the proposed collection actions balanced

the need for efficient tax collection with petitioner’s concern

that they not be more intrusive than necessary.

     Petitioner did not offer any evidence that the filing of the

NFTL would impair his ability to pay his outstanding liabilities.

On the basis of the facts presented, we hold that the settlement

officer did not abuse her discretion in sustaining the filing of

the NFTL.   In reaching these holdings, we have considered all of

the parties’ arguments, and, to the extent not addressed herein,

we conclude that they are moot, irrelevant, or without merit.

     To reflect the foregoing,


                                            Decision will be entered

                                       for respondent.




     7
      The only issues raised in the petition are: “My home is
under construction and lien is preventing me from completing my
home. Taxes from 1999 and 2002 have been paid.” At the time
petitioner filed the petition, he was making monthly payments of
$286 pursuant to the new installment agreement.
