Flathers v. Comm'r , 85 T.C.M. 969 ( 2003 )


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  • CHERYL D. FLATHERS, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
    Flathers v. Comm'r
    13037-02L
    United States Tax Court
    T.C. Memo 2003-60; 2003 Tax Ct. Memo LEXIS 61; 85 T.C.M. (CCH) 969; T.C.M. (RIA) 55067;
    March 4, 2003, Filed

    *61 Respondent's motion for summary judgment and to impose penalty granted.

    Cheryl D. Flathers, pro se.
    Rollin G. Thorley, for respondent.
    Chiechi, Carolyn P.

    CHIECHI

    MEMORANDUM OPINION

    CHIECHI, Judge: This case is before the Court on respondent's motion for summary judgment and to impose a penalty under section 6673 (respondent's motion). 1 We shall grant respondent's motion.

                 Background

    The record establishes and/or the parties do not dispute the following.

    Petitioner resided in Las Vegas, Nevada, at the time she filed the petition in this case.

    On or about March 17, 1999, petitioner filed a Federal income tax (tax) return for her taxable year 1998 (1998 return). In her 1998 return, petitioner reported total income of $ 0, total tax of $ 0, and claimed a refund*62 of $ 4,704.60 of tax withheld. Petitioner attached to her 1998 return Form W-2, Wage and Tax Statement, reporting wages, tips, and other compensation of $ 47,554.71. Petitioner also attached a two-page document to that return (petitioner's attachment to her 1998 return). That document stated in pertinent part:

       I, Cheryl Dawn Flathers, am submitting this as part of my 1998

       Income Tax Return, even though I know that no section of the

       Internal Revenue Code:

         1) Establishes an income tax "liability [sic]: as, for

         example, Code Sections 4401, 5005, and 5703 do with respect

         to wagering, alcohol, and tobacco taxes;

         2) Provides that income taxes "have to be paid on the basis

         of a return" -- as, for example, Code Sections 4374,

         4401(c), 5061(a) and 5703(b) do with respect to other

         taxes; I am filing anyway because I know the government has

         prosecuted others for failing to file income tax forms by

         (erroneously) invoking Code Sections 7201 and 7203.

         Therefore, this return is not being filed voluntarily*63 but

         is being filed out of fear that if I did not file this

         return I could also be (illegally) prosecuted for failing

         to file an income tax return for the year 1998.

         3) In addition to the above, I am filing even though the

         "Privacy Act Notice" as contained in a 1040 booklet clearly

         informs me that I am not required to file. It does so in at

         least two places.

            a) In one place, it states that I need only file a

            return for "any tax" I may be "liable" for. Since no

            Code Section makes me "liable" for income taxes, this

            provision notifies me that I do not have to file an

            income tax return.

           b) In another place, it directs me to Code Section

            6001. This section provides, in relevant part that



            "Whenever in the judgment of the Secretary it is



            necessary, he may require any person by notice



            served on such person; or by regulations, to

        *64     make such returns, render such statements, or keep

            such records, as the Secretary deems sufficient to



            show whether or not such person is liable far [sic]



            the tax under this title." Since the Secretary of the



            Treasury did not "serve" me with any such "notice" and



            since no legislative regulation exists requiring



            anyone to file an income tax return, I am again



            informed by the "Privacy Act Notice" that I am not



            required to file an income tax return.



               *   *   *   *   *   *   *



       7) It should also be noted that I had "zero" income according to

       the Supreme Court's definition of income * * * since in



      Merchant's Loan & Trust C.V. Smlietanka [sic], 255 U.S. 509">255 U.S. 509, 65 L. Ed. 751">65 L. Ed. 751, 41 S. Ct. 386">41 S. Ct. 386, (at pages 518 & 519) that court held that "The

       word (income) must be given the same meaning in all of the



       Income Tax Acts of Congress that was given to it in the



       Corporation Excise Tax Act of 1909." Therefore, since I had no

     *65   earnings in 1998, that would have been taxable as "income" under

       the Corporation Excise Tax Act of 1909, I can only swear to

       having "zero" income in 1998. Obviously, since I know the legal

       definition of "income"; if I were to swear to having received

       any other amount of "income" I would be committing perjury

       * * *. Therefore, not wishing to commit perjury * * *, I can

       only swear to having "zero" income for 1998.

    On June 14, 1999, respondent paid petitioner the $ 4,704.60 refund that she claimed in her 1998 return plus interest thereon.

    On February 4, 2000, respondent issued to petitioner a notice of deficiency (notice) with respect to her taxable year 1998, which she received. In that notice, respondent determined a deficiency in, and an accuracy-related penalty under section 6662(a) on, petitioner's tax for her taxable year 1998 in the respective amounts of $ 5,969 and $ 1,177.

    Petitioner did not file a petition in the Court with respect to the notice relating to her taxable year 1998. Instead, on April 15, 2000, in response to the notice, petitioner sent a letter (petitioner's April 15, 2000 letter) to the Internal Revenue Service. *66 That letter stated in pertinent part:

         Your Deficiency Notice dated February 4, 2000.

         First and foremost, be advised that this alleged deficiency

       has been created out of thin air by the IRS from a return which

       I submitted in a timely manner, a return which was reviewed by

       the IRS and a refund issued, including interest paid for the

       delay in refunding the amount to me. The IRS now attempts to

       extort penalties and interest on top of the amount duly refunded

       to me.

         According to your "Deficiency Notice" of the above

       date (cover sheet [page 1 of notice with respect to petitioner's

       taxable year 1998] attached), there is an alleged deficiency

       with respect to my 1998 income tax return of $ 7546.09, and if I

       wanted to "contest this deficiency before making

       payment," I must "file a petition with the United States

       Tax Court." Before I file, pay, or do anything with respect

       to your "Notice" I must first establish whether or not

       it was sent pursuant to law, whether or not it has the

       "force and effect of law," and whether*67 you had any

       authority to send me the Notice in the first place.

               *   *   *   *   *   *   *

       Let me further point out that IRS Code Sections 6001 and 6011

       (as identified in the 1040 Privacy Act) notifies me that I need

       only "comply with regulations." Nothing in the

       Privacy Act Notice or in the above statutes informs me that I

       have to "comply" with, or pay attention to, letters

       and/or alleged "determinations" sent to me by various

       and sundry employees of the IRS .

         Please note that Section 6212 states that "If the

       Secretary determines that there is a deficiency in

       respect of any tax . . . he is authorized to send notice of such

       deficiency etc., etc., etc." However, the "Notice" I

       received was not sent by the Secretary but by Deborah S. Decker

       who is identified as being the Director of the IRS Service

       Center in Ogden, Utah, and I have no way of knowing whether

       he/she has been delegated by the Secretary to send out such

       notices on the Secretary's behalf. So before I do anything at

       all with*68 respect to your "Notice", I would have to see a

       Delegation Order from the Secretary of the Treasury delegating

       Deborah S. Decker the authority to send out Deficiency Notices.

         In addition, I would also like you to send me (or identify

       for me) the legislative regulations that you claim

       implement Code Sections 6212 and 6213. I have also attached an

       excerpt from the IRS Procedures Manual (MT 1218-196, at page P-

       6-40) which points out that the IRS is required to "make

       available to all taxpayers comprehensive, accurate, and timely

       information on the requirements of tax law and regulations."

       So, pursuant to this provision from your Procedures Manual, I am

       asking that you identify (" make available") for me the

       legislative regulations that you claim implement both Code

       Section 6212 and 6213 -- since I haven't been able to locate

       them.

    On July 17, 2000, respondent assessed a frivolous return penalty under section 6702 regarding petitioner's 1998 return.

    On July 24, 2000, respondent assessed petitioner's tax, as well as a penalty under section 6662(a) and interest as*69 provided by law, for her taxable year 1998. (We shall refer to those assessed amounts, as well as interest as provided by law accrued after July 24, 2000, as petitioner's unpaid liability for 1998.)

    On July 24, 2000, respondent issued to petitioner a notice of balance due with respect to petitioner's unpaid liability for 1998.

    On October 12, 2000, respondent issued to petitioner a final notice of intent to levy and notice of your right to a hearing (notice of intent to levy) with respect to the frivolous return penalty under section 6702 regarding her 1998 return.

    On May 30, 2001, respondent issued to petitioner a notice of Federal tax lien and your right to a hearing (notice of tax lien) with respect to both petitioner's unpaid liability for 1998 and the frivolous return penalty under section 6702 regarding her 1998 return.

    On or about June 25, 2001, in response to the notice of intent to levy and the notice of tax lien, petitioner filed Form 12153, Request for a Collection Due Process Hearing (Form 12153), and requested a hearing with respondent's Appeals Office (Appeals Office). Petitioner attached, inter alia, a seven-page document to her Form 12153 (petitioner's attachment*70 to her Form 12153). That document stated in pertinent part:

         1. VERIFICATION FROM THE SECRETARY. First of

       all, I expect you to have at the CDP hearing "verification

       from the Secretary that the requirements of any applicable law

       or administrative procedure have been met". That is the

       specific statement from the Secretary (or his delegate) that THE

       LAW requires you to have. Don't tell me at the CDP

       hearing that in lieu of your having that specific statement from

       the Secretary, you have some IRS transcript or printout that

       "I may not understand". * * *

         2. PROOF OF ASSESSMENT AND COPY OF RETURN SHOWING

       OWED TAXES

       Pursuant to Code Section 6201(1), before I can owe any income

       taxes there has to be an assessment based on a "return or

       list". I filed a return showing no taxes due, in fact a

       return that showed a refund for which a refund check was

       issued by the Internal Revenue Service, PLUS INTEREST!

       Therefore, I do not see how the IRS could have made a lawful

       assessment from a return showing no income taxes due and owing

    *71    unless the IRS prepared another 1040 showing a different

       amount due. * * *

               *   *   *   *   *   *   *

         3. A COPY OF FORM 17, STATUTORY NOTICE OF

       DEFICIENCY

       I have never received a Statutory Notice of Deficiency, Form 17,

       for payment of any 1998 income taxes.

               *   *   *   *   *   *   *

         4. I CLAIM THERE IS NO UNDERLYING, STATUTORY

       LIABILITY IN CONNECTION WITH THE INCOME TAXES AT ISSUE.

       I am challenging the "existence" of the underlying tax

       liability as the law (Sec. 6330(c)(2)(B)) and regulation

       (301.6330-1T-(3)) specifically permit me to do. * * *

               *   *   *   *   *   *   *

         5. I CLAIM THERE IS NO STATUTE REQUIRING ME "TO

       PAY" THE INCOME TAXES AT ISSUE.

       * * * it is my belief that there is no law requiring me "to

       pay" income taxes * * *

         6. NO LAW AUTHORIZES THE IRS TO CLAIM THAT I OWE MORE

       IN INCOME TAXES THAN THE "ZERO" I REPORTED ON MY 1998

       INCOME TAX RETURN.

    *72    * * * it is my contention that no law authorizes the Secretary

       (let alone any IRS agent) to determine that I owe more in income

       taxes that the "zero" I reported on my 1998 income tax

       return. * * * [Reproduced literally.]

    On April 12, 2002, a settlement officer with respondent's Appeals Office (settlement officer) sent petitioner a letter. That letter stated in pertinent part:

       I have scheduled the Collection Due Process hearing you

       requested on this case for the time and date shown above [May

       16, 2002]. * * *

       Your request for a due process hearing was timely for the Letter

       3172, Notice of Federal Tax Lien Filing, issue for the Form 1040

       taxes for 1998 and for the civil penalty assessment for 1998.

       Your request for a due process hearing for the Letter 1058,

       Notice of Intent to Levy, on the civil penalty assessment for

       1998 was not timely and therefore, you are entitled to an

       equivalency hearing on this matter.

       Appeals' jurisdiction to hear your case is specified in the

       Internal Revenue code, Sections 6320 and 6330, and the related

      *73 federal regulations. Appeals will consider the appropriateness

       of the proposed collection action, spousal defenses, and

       collection alternatives. If you received a statutory notice of

       deficiency * * * you may not raise as an issue the amount or

       existence of the underlying assessment. * * *

       I am also enclosing Forms 2866, Certificate of Official Record,

       and Forms 4340, Certificate of Assessment for the Form 1040

       taxes for 1998 and for the civil penalty assessment under IRC

       section 6702 for 1998. These documents meet the verification

       requirements under IRC section 6330(c)(1). Your request for

       additional information should be made under the

       Freedom of Information Act through the Disclosure Officer located at the

       Internal Revenue Service, 210 E. Earll, Phoenix, Arizona 85012.

       I have reviewed the correspondence you attached to your request

       for the collection due process hearing and would like to point

       out that the courts have previously ruled against your

       arguments, and in some instances, have imposed sanctions. I have

       verified*74 the validity of the assessments through the review of

       the complete computer transcripts, the tax return file and

       related workpapers. I have no further legal obligation to

       consider any challenge to the validity of the assessment in the

       absence of independent proof that the assessment was defective

       in some manner. I am hopeful that you wish to discuss legitimate

       issues and alternatives for resolving your case at the upcoming

       hearing. I will have the original tax return for 1998 available

       for your review at the hearing, as well as the civil penalty

       documentation.

    On May 3, 2002, respondent's settlement officer sent petitioner another letter (settlement officer's May 3, 2002 letter). That letter stated in pertinent part:

       I am writing to you regarding the upcoming collection due

       process hearing set for May 16, 2002 at 3:00 p.m. at the Las

       Vegas Appeals Office.

       You previously indicated in your correspondence that you

       intended to audio record the hearing and have a court reporter

       present. There has been a recent change in this practice for

       hearings before*75 Appeals. Effective immediately audio and

       stenographic recordings will no longer be allowed on Appeals

       cases.

       The recording of hearings has always been discretionary for

       Appeals under IRC section 7521. Pursuant to a recent decision all

       audio and stenographic recordings will be eliminated. You may

       still have a witness present at the hearing; however, this

       witness may not represent you or negotiate for you.

    On May 7, 2002, in response to the settlement officer's May 3, 2002 letter, petitioner sent the settlement officer a letter (petitioner's May 7, 2002 letter). That letter stated in pertinent part:

       I am in receipt of your letter of May 3, 2002, in which you

       attempt to deny me the right to record my hearing under IRC

       section 7521.

               *   *   *   *   *   *   *

       Who made this "recent decision", where is the

       documentation? Where is the proof of legislative mandate

       providing authority to make this change? Furthermore, under

       whose authority is my Constitutional right to preserve testimony

       for myself*76 being truncated? After all, I require an accurate

       record of who said what and when.

       The code quoted [section 7521] deals with "Procedures

       involving taxpayer interviews". Are you then stating, by

       quoting this code section, that you are only conducting an

       "interview" and not a "hearing" as is my right

       under the law? You are labeled as a "settlement

       officer", not an "appeals officer". If you are

       unable to show authority as an appeals officer, then I require

       that you provide an appeals officer at the hearing who has the

       authority to impartially decide the issues at hand. If this is

       an "interview" which is conducted by exam and audit and

       for which the code you quote would be correct, then I am not

       receiving a hearing. If you claim this is a hearing, then an

       appeals officer, with appropriate identification will need to be

       present to conduct a true hearing, and the code you quote does

       not apply.

    On May 13, 2002, in response to petitioner's May 7, 2002 letter, respondent's settlement officer sent petitioner a letter (settlement officer's May 13, 2002 letter). *77 That letter stated in pertinent part:

       I am in receipt of your letter dated May 7, 2002 regarding the

       change in procedures for the audio recording or stenographic

       recording of Appeals hearings. I am enclosing a copy of the

       memorandum dated May 2, 2002 per your request for documentation

       of this change.

       This will be a "hearing" and as a settlement officer I

       have the same authority as an appeals officer to impartially

       decide the issues at hand, as you stated in your letter.

    The copy of the memorandum referred to in the settlement officer's May 13, 2002 letter, which the settlement officer enclosed with that letter, stated in pertinent part:

       Effective immediately, audio and stenographic recordings will no

       longer be allowed on Appeals cases. Taxpayers and/or

       representatives who have already requested such recordings will

       be informed of the change in practice immediately, and advised

       that their request cannot be allowed.

       BACKGROUND

       Prior to enactment of IRC 7521, Service Compliance functions

       voluntarily allowed audio recordings.*78 Appeals decided to follow

       this practice at that time. IRC 7521, enacted in 1988, provided

       for the allowance of audio recordings of conferences relative to

       the determination or collection of a tax, between the taxpayer

       and the Internal Revenue Service, provided that the Service was

       given at least ten (10) days advance notice of the taxpayer's

       intent to record the conference.

       Although Appeals makes liability and collectibility

       determinations, Appeals' procedures differ from Examination and

       Collection function contacts that are not discretionary for the

       taxpayer. Contact with Appeals is discretionary for the

       taxpayer, and as such, recording has always been discretionary

       for Appeals. * * *

    On May 16, 2002, respondent's settlement officer held an Appeals Office hearing with petitioner with respect to the notice of tax lien. 2 Although petitioner knew that the Appeals Office no longer allowed audio recordings of Appeals Office hearings, petitioner secretly made an audio recording of her Appeals Office hearing. At the Appeals Office hearing, the settlement officer*79 gave petitioner Form 4340, Certificate of Assessments, Payments, and Other Specified Matters (Form 4340), with respect to her taxable year 1998.

    On July 11, 2002, the Appeals Office issued to petitioner a notice of determination concerning collection action(s) under section 6320 and/or 6330 (notice of determination) with respect to petitioner's unpaid liability for 1998 (notice of determination with respect to petitioner's unpaid liability for 1998). 3 An attachment to that notice stated in pertinent part:

    *80    Verification of Legal and Procedural Requirements

       The Secretary has provided sufficient verification that the

       requirements of any applicable law or administrative procedure

       have been met.

       Certified account transcripts, Forms 4340, were requested and

       reviewed along with the administrative return file for 1998,

       which included the civil penalty work papers. * * *

               *   *   *   *   *   *   *

         The collection due process and equivalency hearings were

       held on May 16, 2002 * * *. The taxpayer was advised prior to

       the hearing by letter that no audio recording or stenographic

       recording of the hearing would be permitted per a directive

       issued by the Acting Chief of Appeals dated May 2, 2002.

       Settlement Officer Rene Swall has had no prior involvement with

       respect to these liabilities.

       Issues Raised by the Taxpayer

       The taxpayer checked both blocks on the Form 12153 and states,

       "see attached letter". Attached is a copy of the Notice

       of Federal Tax Lien (NFTL), the Letter 3172, and*81 several pages

       of non-filer arguments. As part of the taxpayer's argument, she

       asks for verification from the secretary, proof of the

       assessments, [and] a copy of the statutory notice of deficiency.

       The taxpayer further claims that there is no underlying

       statutory liability in connection with the income taxes at

       issue, that there is no statute requiring her to pay the taxes

       at issue, and that no law authorizes the Service to claim that

       she owes more income tax than the "zero" reported on her

       return. In addition the taxpayer states that she did not receive

       a notice and demand for payment per IRC section 6331.

       Certified transcripts, Forms 4340, for both periods were

       provided to the taxpayer prior to the hearing. The taxpayer was

       advised by letter that these transcripts meet the verification

       requirements under IRC section 6330(c)(1). * * *

       At the hearing the taxpayer raised the issue of audio recording

       and was advised again that the audio recording would not be

       allowed. * * *

         *82       *   *   *   *   *   *   *

       I attempted to review the Form 4340 transcripts and the

       administrative file with the taxpayer, which included the tax

       return filed and the statutory notice of deficiency that was

       sent and received. The taxpayer stated that what I provided her

       as evidence of the statutory notice of deficiency was only a

       "letter". The taxpayer was advised that she could not

       raise the issue of the underlying liability as she had received

       the statutory notice of deficiency, and had in fact responded to

       it with additional frivolous arguments. The taxpayer is now

       precluded from raising this issue at the collection due process

       hearing. Collection alternatives could not be discussed with the

       taxpayer, as the taxpayer is not in filing compliance, nor did

       the taxpayer attempt to complete the financial statement that

       was mailed to her prior to the hearing. The taxpayer asked for

       the cite that makes her liable to pay the taxes and continued to

       raise only frivolous arguments. The hearing was concluded.

       The taxpayer does not*83 believe that wages are income or that the

       tax laws apply to her. I advised the taxpayer of recent court

       case decisions where sanctions were imposed for bringing the

       same type of arguments and attempted to provide the taxpayer

       with copies of recent cases on T. Pierson and R.

       Davis as well as Publication 2105, Why Do I Have to Pay

       Taxes, and a handout, The Truth About Frivolous Tax Arguments.

       The taxpayer refused to accept these from me.

               *   *   *   *   *   *   *

       The taxpayer raised no other non-frivolous issues.

       Balancing the Need for Efficient Collection with Taxpayer

       Concerns

       The requirements of all applicable laws and administrative

       procedures have been met. The courts have previously addressed

       the taxpayers' arguments, and Appeals does not have the

       authority for reconsideration of the matters. The assessments

       are valid and the Service followed proper procedures in making

       these assessments. For the civil penalty to apply the

       individual's conduct must be due in part to a position, which is

    *84    frivolous, or a desire (which appears on the return) to delay or

       impede the administration of Federal income tax laws. Income

       reported to the Service verifies that the taxpayer had

       sufficient income that would require her to file a return. The

       taxpayer was provided an opportunity to file a correct return,

       but instead responded with frivolous arguments. The taxpayer

       received her required notices. The filing of the NFTL was

       appropriate to protect the Government's interest. In addition,

       the issuance of the notice of intent to levy was appropriate on

       the civil penalty assessment. No collection alternatives could

       be discussed as the taxpayer is not in filing compliance and the

       taxpayer only continued to raise frivolous arguments.

       Given the taxpayer's history of non-compliance, I believe that

       collection action in the form of levy should be allowed to

       proceed. Lacking the taxpayer's cooperation, the proposed

       collection action balances the need for efficient collection of

       taxes with the taxpayer's legitimate concern that any collection

       action be*85 no more intrusive than necessary.

                 Discussion

    The Court may grant summary judgment where there is no genuine issue of material fact and a decision may be rendered as a matter of law. 4Rule 121(b); Sundstrand Corp. v. Commissioner, 98 T.C. 518">98 T.C. 518, 520 (1992), affd. 17 F.3d 965">17 F.3d 965 (7th Cir. 1994). We conclude that there is no genuine issue of material fact regarding the questions raised in respondent's motion.

    *86 With respect to petitioner's taxable year 1998, petitioner received a notice of deficiency, but she did not file a petition with respect to that notice. On the instant record, we find that petitioner may not challenge the existence or the amount of petitioner's unpaid liability for 1998. See sec. 6330(c)(2)(B); Sego v. Commissioner, 114 T.C. 604">114 T.C. 604, 610-611 (2000); Goza v. Commissioner, 114 T.C. 176">114 T.C. 176, 182-183 (2000).

    Where, as is the case here, the validity of the underlying tax liability is not properly placed at issue, the Court will review the determination of the Commissioner of Internal Revenue for abuse of discretion. Sego v. Commissioner, supra at 610; Goza v. Commissioner, supra at 181-182.

    As was true of petitioner's attachment to her 1998 return, petitioner's April 15, 2000 letter, petitioner's attachment to her Form 12153, and petitioner's May 7, 2002 letter, petitioner's response contains contentions, arguments, statements, and requests that the Court finds to be frivolous and/or groundless. To illustrate, petitioner appears to argue that she did not receive proper notice and demand under section 6303(a) because, according*87 to petitioner, respondent must use Form 17 in issuing such notice and demand.

    We reject petitioner's argument that respondent did not issue the notice and demand required by section 6303(a). Form 4340 with respect to petitioner's taxable year 1998 shows that respondent sent petitioner a notice of balance due on July 24, 2000, the same day on which respondent assessed petitioner's tax, as well as any penalties and interest as provided by law, for her taxable year 1998. A notice of balance due constitutes the notice and demand for payment under section 6303(a). Craig v. Commissioner, 119 T.C. 252">119 T.C. 252, 262-263 (2002). Respondent is not required to use Form 17 as the notice and demand for payment. E.g., Keene v. Commissioner, T.C. Memo. 2002-277; Tapio v. Commissioner, T.C. Memo 2002-141">T.C. Memo. 2002-141.

    As a further illustration of the frivolous and/or groundless nature of petitioner's position in this case, petitioner contends in petitioner's response that the settlement officer failed to obtain verification that the requirements of any applicable law or administrative procedure have been met, as required by section 6330(c)(1). In this regard, petitioner contends*88 that the settlement officer improperly relied on Form 4340 to meet the verification requirement of section 6330(c)(1).

    The record establishes that the settlement officer obtained verification from the Secretary that the requirements of any applicable law or administrative procedure were met, and we reject petitioner's contention to the contrary. As for the settlement officer's reliance on Form 4340, at the Appeals Office hearing, the settlement officer relied on, and gave petitioner, Form 4340 with respect to petitioner's taxable year 1998. Section 6330(c)(1) does not require the settlement officer to rely on a particular document to satisfy the verification requirement imposed by that section. Craig v. Commissioner, supra at 261-262. Nor does section 6330(c)(1) require the settlement officer to provide petitioner with a copy of the verification upon which the settlement officer relied. 119 T.C. at 262. Form 4340 is a valid verification that the requirements of any applicable law or administrative procedure have been met. Id. Petitioner has not shown any irregularity in respondent's assessment procedure that would raise a question about the validity of the assessment*89 or the information contained in Form 4340 with respect to petitioner's taxable year 1998. We hold that the assessment with respect to petitioner's taxable year 1998 was valid and that the settlement officer satisfied the verification requirement of section 6330(c)(1). See id. 5

    Based upon our examination of the entire record before us, we find that respondent did not abuse respondent's discretion in determining to proceed with the collection action*90 as determined in the notice of determination with respect to petitioner's unpaid liability for 1998.

    In respondent's motion, respondent requests that the Court require petitioner to pay a penalty to the United States pursuant to section 6673(a)(1). Section 6673(a)(1) authorizes the Court to require a taxpayer to pay to the United States a penalty in an amount not to exceed $ 25,000 whenever it appears to the Court, inter alia, that a proceeding before it was instituted or maintained primarily for delay, sec. 6673(a)(1)(A), or that the taxpayer's position in such a proceeding is frivolous or groundless, sec. 6673(a)(1)(B).

    In Pierson v. Commissioner, 115 T.C. 576">115 T.C. 576, 581 (2000), we issued an unequivocal warning to taxpayers concerning the imposition of a penalty under section 6673(a) on those taxpayers who abuse the protections afforded by sections 6320 and 6330 by instituting or maintaining actions under those sections primarily for delay or by taking frivolous or groundless positions in such actions. 6

    *91 In the instant case, petitioner advances, we believe primarily for delay, frivolous and/or groundless contentions, arguments, statements, and requests, thereby causing the Court to waste its limited resources. We shall impose a penalty on petitioner pursuant to section 6673(a)(1) in the amount of $ 1,500.

    We have considered all of petitioner's contentions, arguments, statements, and requests that are not discussed herein, and we find them to be without merit and/or irrelevant.

    To reflect the foregoing,

    An appropriate order granting respondent's motion and decision will be entered for respondent.


    Footnotes

    • 1. All section references are to the Internal Revenue Code in effect at all relevant times. All Rule references are to the Tax Court Rules of Practice and Procedure.

    • 2. On May 16, 2002, respondent's settlement officer also held an equivalent hearing with petitioner with respect to the notice of intent to levy.

    • 3. On July 11, 2002, the Appeals Office also issued to petitioner (1) a notice of determination with respect to the frivolous return penalty regarding petitioner's 1998 return and (2) a decision letter concerning equivalent hearing under sec. 6320 and/or 6330 (decision letter) with respect to the notice of intent to levy issued to petitioner with respect to the frivolous return penalty regarding petitioner's 1998 return (decision letter with respect to the frivolous return penalty regarding petitioner's 1998 return).

    • 4. The only questions raised in respondent's motion relate to petitioner's unpaid liability for 1998 over which we have jurisdiction and do not relate to the frivolous return penalty regarding her 1998 return over which we do not have jurisdiction. In this connection, on Feb. 6, 2003, the Court issued an Order granting respondent's motion to dismiss this case for lack of jurisdiction insofar as petitioner sought review of either the notice of determination with respect to the frivolous return penalty regarding petitioner's 1998 return or the decision letter with respect to the frivolous return penalty regarding petitioner's 1998 return.

    • 5. In petitioner's response, petitioner also argues that "Appeals personnel denied Petitioner the right to protect her rights in total disregard for the Taxpayer Bill of Rights, Publication 1 and Petitioner's constitutional right to protect oneself." That is because, according to petitioner, the Appeals Office denied her request to record her Appeals Office hearing. However, petitioner admits that she "did in fact tape the CDP hearing", and we shall not address petitioner's argument about the Appeals Office's refusal to permit her to record her Appeals Office hearing.

    • 6. The record in this case reflects that the settlement officer attempted to give petitioner, inter alia, a copy of the Court's opinion in Pierson v. Commissioner, 115 T.C. 576">115 T.C. 576 (2000), which she refused to accept.

Document Info

Docket Number: 13037-02L

Citation Numbers: 2003 T.C. Memo. 60, 85 T.C.M. 969, 2003 Tax Ct. Memo LEXIS 61

Judges: \"Chiechi, Carolyn P.\"

Filed Date: 3/4/2003

Precedential Status: Non-Precedential

Modified Date: 4/18/2021