§301 — Distributions of property

Supreme Court overruled Chevron.

325 (2023) (granting certiorari for the question of whether the Supreme Court should overrule Chevron).

It is inappropriate for us to decide whether the circumstances of these cases warrant equitable tolling until we address whether Boechler requires us to overrule our precedent that has held that the 30-day period is a fixed deadline not subject to waiver.

18, 1953) (transferring the Secretary’s closing agreement functions to the Commissioner), modified and superseded by Treas.

Instead, because petitioner’s election to be disregarded resulted in a reorganization described in section 368(a)(1)(F), the construct that would otherwise have been supplied by the entity classification regulations is superseded by a construct necessary to apply to the reorganization the operative nonrecognition provisions of sections 354 and 361.

984 (designating UPS Next Day Air as a qualified private delivery service) (superseded by Notice 2016-30, 2016-18 I.R.B.

491, was amplified and superseded by Rev.

485, 493 (2017), supplementing and overruling in part 147 T.C.

708, 708, superseded by Rev.

183, 187-188 (2002) (overruling various challenges by a taxpayerto the introduction into evidence ofa certified mail list--the equivalent ofa USPS Form 3877--by the Commissioner).

However, petitioner argues that the check-the-boxre ulations are superseded by section 1.932-1(h)( ), Income Tax Regs., which pro ides: Solely for the purpose ofdetermining classification ofan eligihle entity under sec.

Because the Court ofAppeals did not consider the regulation in concluding in Petaluma II that outside basis is an affected item, we believe that its decision on the outside basis issue in Petaluma II has been superseded by the intervening opinions ofthe Supreme Court in Mayo Found.

Circuit noted: It appears that the Tax Court may have recently altered or overruled the Petaluma III decision under review in the case.

taxpayer who takes a position that a treaty of the United States overrules any provision of the Internal Revenue Code and effects a reduction of any tax must disclose that position on either a Form 8833 or a separate attached statement.

Thus, an Appeals Officer is distinguishable from Tax Court STJs, see § 7456(a) (1991), and SEC ALJs, see 17 C.F.R.

§ 301.6235- 1(b)(2)(A) holds the period of adjustment open longer than I.R.C. § 6235(a)(2), it is contrary to the statute. Held, further, the extended period of limitations for a substantial omission of income under section 6235(c)(2) does not apply when the taxpayer adequately discloses the nature and amount of the omitted income.

And respondent does not argue, and the opinion of the Court does not hold, that Treasury Regulation § 301.7122-1(b)(2) refers to taxable income. Accordingly, section 280E, which applies for purposes of determining taxable income, see § 261, does not apply for purposes of determining income, and therefore does not apply for purposes of determining whether there is doubt as to collectibility, see Treas.

§ 301.6221-1(c). The Com- missioner has no burden of production with respect to penalties in a TEFRA partnership action. Dynamo, 150 T.C. at 236. Thus, the burden of showing that the negligence penalty does not apply—including the availability of any defenses—is on petitioner.

In determining whether the taxpayer had an opportunity to dis- pute her underlying liability, the regulations distinguish between liabil- ities that are subject to deficiency procedures and those that are not. See Treas. Reg. § 301.6330-1(e)(3), Q&A-E2.

§ 301.7502-1(a); see also, e.g., Malekzad v. Commissioner, 76 T.C. 963, 966 (1981) (“[T]o come within the terms of section 7502, the petition must have been timely mailed on or before the last date for filing.”). Accordingly, the Petition was untimely filed with the Court on June 24, 2022, the date of delivery. See, e.g., Nutt v. Commissioner, No. 15959-22, 160 T.C., slip op. at 4 (May 2, 2023) (“Where section 7502 does not apply, ‘we must look to the date the “petition” was actually received an

Section 6330(c)(2)(B), unlike section 6212(b), requires receipt of a deficiency notice to be “sufficient.” See Kuykendall v. Commissioner, 129 T.C. 77, 80 (2007); Campbell v. Commissioner, T.C. Memo. 2012-82, 103 T.C.M. (CCH) 1446; see also Treas. Reg. § 301.6330-1(e)(3), Q&A-E2, Moreover, the notices of deficiency and USPS Form 3877, Firm Mailing Book for Accountable Mail (PS Form 3877), attached as an Exhibit to the Declaration, both indicate that the notices of deficiency were mailed to petit

tax returns or request an extension to file the form with a late return under Treasury Regulation § 301.9100-2, he has not satisfied the deferral election requirements under Revenue Procedure 2002-23. Lastly, the Commissioner argues that the doctrine of substantial compliance does not apply in determining whether Mr.

The taxpayer can show that he did not act with “willful neglect” if he can “prove that the late filing did not result from 3 This case is distinguishable from prior cases—e.g., involving car dealerships, construction companies, and companies engaged in the sale and leasing of aircraft— in which we found car or motorcycle racing expenses to be deductible advertising costs.

301.7701-2(c)(2)(i), Proced. & Admin. Regs., provides: “Except as otherwise provided in this paragraph (c), a business entity that has a single owner and is not a corporation under paragraph (b) of this section is disregarded as an entity separate from its owner.” Although this rule generally does not apply for employment tax purposes, id.

301.7701- 9(c), Proced. & Admin. Regs. 8Although Delegation Order 4-8, IRM pt. 1.2.43.9(4) (Sept. 4, 2012), states that the authority delegated therein “may not be redelegated”, this restriction does not apply to the Commissioner, whose delegated authority and authority to redelegate arises not from any delegation order but rather from regulations.

301.6231(a)(3)-1(a)(1)(i), Proced. & Admin. Regs. For partnership tax years beginning before January 1, 2018, section 6225(a) may preclude our review of a partnership item in a partner-level proceeding like this one, as opposed to a partnership-level proceeding. See Wadsworth v. Commissioner, T.C. Memo. 2007-46, slip op. at 10 (citing section 6225(a) and Maxwell v. Commissioner, 87 T.C. 783, 789 (1986)). However, the section 6225(a) jurisdictional limitation does not apply unless the partnership

Respondent argues that section 301.7502-1(c)(1)(iii)(B)(1), Proced. & Admin. Regs., does not apply because the envelope containing the petition bears a USPS postmark dated March 6, 2018, which shows that the petition was mailed one day late.

at 246 (quoting section 301.6651-1(c)(1), Proced. & Admin. Regs.). While we are sympathetic to the challenges Ms. Wienke faced over this period, nothing in the ¹³ The burden ofproduction as to Evergrow's additions to tax remains with Evergrow because sec. 7491(c) does not apply to corporations.

at 246 (quoting section 301.6651-1(c)(1), Proced. & Admin. Regs.). While we are sympathetic to the challenges Ms. Wienke faced over this period, nothing in the ¹³ The burden ofproduction as to Evergrow's additions to tax remains with Evergrow because sec. 7491(c) does not apply to corporations.

301.7502 (e)(2), Proced. & Admin. Regs., precluded the introduction ofextrinsic evidence where the IRS did not receive the tax return and the taxpayers sought to rely on the common law mailbox rule to establish that their return was presumptively delivered to the IRS, shortly after they mailed it. However, this case is distinguishable because the Court received the petition on July 17, 2017, and the parties do not dispute the actual delivery ofthe petition.

301.6058-1(d)(2) and (3), Proced. & Admin. Regs. Form 5329 is a tax return within the meaning ofsection 6011, and failure to file it can result in the section 6651(a)(1) addition to tax. See Frick v. Commissioner, 1989 Tax Ct. Memo LEXIS 75, at *20-*21. The addition to tax does not apply ifthe failure to file timely is due to reasonable cause and not due to willful neglect.

Under section 301.7502-1(c)(1)(iii)(B)(3), Proced. & Admin. Regs., we disregard the Endicia.com label and determine the timeliness ofthe petition on the basis ofthe USPS postmarks. Neither ofthe two USPS postmarks is dated within the 90-day period for Ms. Jordan to file her petition under section 6213(a). Therefore, the "timely mailed, timely filed" rule does not apply, and Ms.

301.6058-1(d)(2) and (3), Proced. & Admin. Regs. Form 5329 is a tax return within the meaning ofsection 6011, and failure to file it can result in the section 6651(a)(1) addition to tax. See Frick v. Commissioner, 1989 Tax Ct. Memo LEXIS 75, at *20-*21. The addition to tax does not apply ifthe failure to file timely is due to reasonable cause and not due to willful neglect.

However, this case is readily distinguishable from Vinatieri.

In determining whether the taxpayerhad a prior opportunityto dis- pute its liability, the regulations distinguish between liabilities that are subject to deficiency procedures and those that are not. Where a liability is not subject to de- ficiency procedures, "[a]n opportunity to dispute the underlying liability includes a prior opportunity for a conference with Appeals that was offered either before or after the assessment ofthe liability." Sec. 301.6320-1(e)(3), Q&A-E2, Proced.

In determining whether the taxpayerhad a prior opportunity to dispute her liability, the regulations distinguish between liabilities that are sub- ject to deficiency procedures and those that are not. Where a liability is not sub- ject to deficiency procedures, "[a]n opportunity to dispute the underlying liability includes a prior opportunity for a conference with Appeals that was offered either before or after the assessment ofthe liability." See sec. 301.6330-1(e)(3), Q&A- E2, Proced.

In determining whether the taxpayer had a prior opportunityto dis- pute her liability, the regulations distinguish between liabilities that are subject to deficiency procedures and those that are not. Where a liability is not subject to de- ficiency procedures, "[a]n opportunity to dispute the underlying liability includes a prior opportunity for a conference with Appeals that was offered either before or after the assessment ofthe liability." See sec. 301.6330-1(e)(3), Q&A-E2, Proced.

301.6330-1(c)(2), Q&A-C1 through C4, Proced. & Admin. Regs. A decision letter constitutes a "determination" sufficient to invoke this Court'sjurisdiction when a taxpayertimely requests a CDP hearing but is errone- ously afforded an equivalent hearing. See Wilson v. Commissioner, 131 T.C. 47, 53 (2008) ("[T]he name or the label ofa document does not control whether the document embodies a determination under section 6330."); Craig v.

A presumption is distinguished from an inference in that, ifbasic fact A is established, then the fact finder must accept that the presumed fact B has also been established unless the presumption is rebutted. See 1 Jack B. Weinstein & Margaret A. Berger, Weinstein's Federal Evidence, sec. 301.02[1], at 301-6 (Mark S.

Unlike the standard for review ofan underlying liability, which hinges on the mere prior opportunityto challenge the liability, the standard for whether a collection issue can be raised at a CDP hearing is whether the issue was actually considered in a previous administrative orjudicial proceeding. Sec. 301.6320- 1(e)(1), Proced.

A presumption is distinguished from an inference in that, ifbasic fact A is established, then the fact finder must accept that the presumed fact B has also been established unless the presumption is rebutted. See 1 Jack B. Weinstein & Margaret A. Berger, Weinstein's Federal Evidence, sec. 301.02[1], at 301-6 (Mark S.

- 14 - [*14] Unlike the taxpayer in Alessio Azzari, Inc., petitioner was indisputably not in compliance when it requested an installment agreement. And because section 301.6343-1(b)(4)(i), Proced.

- 13 - [*13] Unlike the taxpayer in Alessio Azzari, Inc., petitioner was indisputably not in compliance when it requested an installment agreement. And because section 301.6343-1(b)(4)(i), Proced.

Unlike the taxpayer in Alessio Azzari, Inc., petitioner was indisputably not in compliance when it requested an installment agreement. And because section 301.6343-1(b)(4)(i), Proced.

Here we find it in section 301.6223(c)- 1(a), which says that the IRS "will use additional information as provided in this section." Paragraph (b) then gives the procedure for furnishing that "additional information." The Janssons concede that they didn't use that procedure to provide the IRS with the additional information that they were indirect partners, which means that the "will use" in paragraph (a) does not apply to their cases.

While an individual may be treated as "not" being in the United States for any day where the individual is considered exempt, such as a - 10 - [*10] teacher who is temporarilypresent in the United States pursuant to a J or Q visa, such an exception does not apply here, where petitioner held an H-1B visa in 2008 and 2009.

In determining whether the taxpayer had a prior opportunityto dis- pute her liability, the regulations distinguish between liabilities that are subject to deficiency procedures and those that are not. For liabilities subject to deficiency procedures, an opportunity for a post-examination conference with the IRS Ap- peals Office does not bar the taxpayer (in appropriate circumstances) from contest- ing her liability in a later CDP proceeding. See sec. 301.6330-1(e)(3), Q&A-E2, Proced.

Unlike the taxpayer in Alessio Azzari, Inc., petitioner was indisputably not in compliance when it requested an installment agreement. And because section 301.6343-1(b)(4)(i), Proced.

301, 110 Stat. at 1457 (1996), effective for interest accruing with respect to, inter alia, deficiencies for taxable years that began after July 30, 1996. Sec. 6404(e)(1)(A) as amended, which does not apply for petitioners' taxable years 1989 and 1990, permits the Commissioner to abate interest on "any deficiency attributable in whole or in part to any unreasonable error or delay by an officer or employee ofthe Internal Revenue Service (acting in his official capacity) in performing a ministeria

- 14 - [*14] Unlike the taxpayer in Alessio Azzari, Inc., petitioner was indisputably not in compliance when it requested an installment agreement. And because section 301.6343-1(b)(4)(i), Proced.

In determining whether the taxpayerhad a prior opportunity to dispute his liability, the regulations distinguish between liabilities that are subject to deficiency procedures and those that are not. For liabilities sub- ject to deficiency procedures, an opportunity for a post-examination conference with the IRS Appeals Office does not bar the taxpayer (in appropriate circumstan- ces) from contesting his liability in a later CDP proceeding. See sec. 301.6330- 1(e)(3), Q&A-E2, Proced.

Here we find it in section 301.6223(c)- 1(a), which says that the IRS "will use additional information as provided in this section." Paragraph (b) then gives the procedure for furnishing that "additional information." The Janssons concede that they didn't use that procedure to provide the IRS with the additional information that they were indirect partners, which means that the "will use" in paragraph (a) does not apply to their cases.

Unlike the taxpayer in Alessio Azzari, Inc., petitioner was indisputably not in compliance when it requested an installment agreement. And because section 301.6343-1(b)(4)(i), Proced.

Here we find it in section 301.6223(c)- 1(a), which says that the IRS "will use additional information as provided in this section." Paragraph (b) then gives the procedure for furnishing that "additional information." The Janssons concede that they didn't use that procedure to provide the IRS with the additional information that they were indirect partners, which means that the "will use" in paragraph (a) does not apply to their cases.

Here we find it in section 301.6223(c)- 1(a), which says that the IRS "will use additional information as provided in this section." Paragraph (b) then gives the procedure for furnishing that "additional information." The Janssons concede that they didn't use that procedure to provide the IRS with the additional information that they were indirect partners, which means that the "will use" in paragraph (a) does not apply to their cases.

Diversified's bid would give the Alterman shareholders approximately $1 million more than MidCoast's bid.¹° Diversified sent the Altermans' advisers a copy ofa memo it had prepared to show that its proposal was distinguishable from the transaction in Owens v. 9(...continued) Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and section 301.6111-2T, Temporary Income Tax Regs., 65 Fed.

Diversified's bid would give the Alterman shareholders approximately $1 million more than MidCoast's bid.¹° Diversified sent the Altermans' advisers a copy ofa memo it had prepared to show that its proposal was distinguishable from the transaction in Owens v. 9(...continued) Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and section 301.6111-2T, Temporary Income Tax Regs., 65 Fed.

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 7Respondent's first contact with petitioners was the September 26, 1995, letter. "In 1996 sec. 6404(e) was amended by the Taxpayer Bill ofRights 2 (TBOR 2), Pub. L. No.104-168, sec. 301, 110 Stat. at 1457 (1996), to permit abatement with respect to "unreasonable" error or delay in performing a "ministerial or managerial" act. The amendment is effective for tax years beginning after July 30, 1996; thus it is inapplicable for tax ye

Diversified's bid would give the Alterman shareholders approximately $1 million more than MidCoast's bid.¹° Diversified sent the Altermans' advisers a copy ofa memo it had prepared to show that its proposal was distinguishable from the transaction in Owens v. 9(...continued) Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and section 301.6111-2T, Temporary Income Tax Regs., 65 Fed.

Diversified's bid would give the Alterman shareholders approximately $1 million more than MidCoast's bid.¹° Diversified sent the Altermans' advisers a copy ofa memo it had prepared to show that its proposal was distinguishable from the transaction in Owens v. 9(...continued) Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and section 301.6111-2T, Temporary Income Tax Regs., 65 Fed.

Unlike the controlling statutes and the ITAR considered in Yakou, the Internal Revenue Code and the regulations are not "silent regarding the manner and the point at which LPR status changes", and they do circumscribe the means by which an LPR may abandon that status for Federal income tax purposes. See sec. 7701(b)(6)(B) (LPR continues until "revoked" or "administratively orjudicially determined to have been abandoned"); sec. 301.7701(b)-1(b)(1), Proced.

While an individual may be treated as "not" being in the United States for any day where the individual is considered exempt, such as a teacher who is temporarilypresent in the United States pursuantto a J or Q visa, such an exception does not apply here, where petitionerheld an H-1B visa in 2009.

Considering all the facts and circumstances, we find that Uniband is readily distinguishable from the educational trust in Michigan v.

Regs., that, unlike participant, a TMP must be a general partner at some time during the taxable year or a general partner when the designation is made. See also section 301.6231(a)(7)-2(a), Proced.

First, unlike a corporate or an 3°See Tafflin v. Levitt, 493 U.S. at 460-461 ("may" is permissive) (citing Charles Dowd Box Co. v. Courtney, 368 U.S. at 506). "May" can be used to express possibility, opportunity, or permission. Webster's New Universal Unabridged Dictionary 1189. Sec. 301.6223(c)-1T(f), Temporary Proced.

301.6320-1(d)(2), Proced. & Admin. Regs. A taxpayer does not have subpoena power over witnesses or documents. See Katz v. Commissioner, 115 T.C. 329, 337 (2000); sec. 301.6320-1(d)(2), Proced. & Admin. Regs. Finally, petitioner suggests that respondent did not reasonably accommodate his disability during the Appeals process. This Court, as well as others, has held that the ADA does not apply to the Federal Government.

We believe section 301.7430-5(h), Example (_2), Proced. & Admin. Regs., is distinguishable.

Petitioners' situation is distinguishable from each ofthe examples in the regulations.

We held a hearing on the motion and announced an intention to grant respondent's motion.partially in that the election under section 301.9100-3, Proced. & Admin. Regs., does not apply.

In future cases, I believe the question of jurisdiction presented here will not be so easily resolved and we will be forced to distinguish aspects of the precedent we create today. Section 301.6231(a) (6)-1(a), Proced.

Thus, our assertion of jurisdiction over penalties here is not affected by, and is distinguishable from, the respective opinions of two Courts of Appeals, which have held that a trial court lacks jurisdiction to determine partners' outside bases in partnership-level proceedings.

301.7502-1(c) (1) (ii), Proced. & Admin. Regs., that "Section 7502 does not apply to any document * * * that is deposited with the mail service of any other country." In other words, foreign postmarks, even those of a sovereign postal service, are not controlling.

Section 301 .6325-1(a), Proced . & Admin . Regs ., provides that a lien shall be released when the entire liability has been satisfied and the lien has become legally unenforceable . Section 6325 does not apply because petitioner's liability has not been fully satisfied .

Unlike the "absent" record there, this case boasts a full record that makes the Commissioner's reasoning quite clear . Because IRM part 5 .8 .7 .6(5) and policy statement P-5-100 are both contained in the Commissioner's manual of policies and procedures, they would seem to hold equal weight . But both guidelines are in the end just that--language guiding the Commissioner's consideration of all the facts and circumstances, as mandated by the regulation that is unquestionably binding, section 301

301 .6221-1T(c) and (d), Temporary Proced . & Admin. Regs ., 64 Fed . Reg. 3838 (Jan . 26, 1999), is invalid, or, in the event we hold the regulation valid, that it does not apply to the instant proceeding .

301.6330-1(f)(1), Q&A-F3, Proced. & Admin. Regs. Therefore, section 6330(d) (1) does not expand this Court's (cid:16)042jurisdiction beyond the types of tax we may normally consider. See Van Es v. Commissioner, supra at 328-329; Moore v. Commissioner, supra at 175. 3. The Court's Analysis in Downing v. Commissioner Does Not Control the Present Cases Petitioners next argue that this Court's analysis in Downing v.

301.6330-1(f) (1), Q&A-F3, Proced, & Admin. Regs. Therefore, section 6330(d)(1) does not expand this Court's urisdiction beyond the types of tax we may normally consider. See Van Es v. Commissioner, supra at 328-329; Moore v. Commissioner,. sup.ra at 175. 3. The Court's Analysis in Downing v. Commissioner Does Not Control the Present Cases Petitioners next argue that this Court's analysis in Downing v.

Unlike an offer in compromise, an installment agreement necessitates full payment of the tax liability involved without compromise. See sec. 301.6159-1, Proced.

301.6621-3(b)(2)(iii)(A), Proced. & Admin. Regs. The interest rate under sec. 6621(c), I.R.C., “hot interest”, does not apply if, after a Federal court determines a taxpayer’s liability for a period, the threshold underpayment for that taxable period does not exceed $100,000.

301.7502-1(c)(1)(ii), Proced. & Admin. Regs., stating: “Section 7502 does not apply to any document which is deposited with the mail service of any other country.” Moreover, Congress did not provide an extended filing period under section 6320 or 6330 when a notice of determination is addressed to a person outside the United States.

301.6651-1(g), Proced. & Admin. Regs. Because no return for petitioner was filed, the addition to tax under section 6651(a)(2) does not apply.

301 of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1452, 1457 (1996), to permit the Secretary to abate interest with respect to an “unreasonable” error or delay resulting from “managerial” and ministerial acts. This amendment, however, applies to interest accruing with respect to deficiencies or payments for tax years beginning after July 30, 1996; therefore, the amendment is inapplicable to the case at bar.

301-307) applies. Sec. 355(a)(1), if applicable to this case, would provide an exception to dividend treatment under sec. 301 and, therefore, an exception to the application of sec. 311(b). See sec. 355(c)(3). We note, in passing, that, because Ridge’s S corporation election was made on, not after, Dec. 31, 1986, sec. 1374, as amended by the Tax Reform Act of 1986 (TRA of 1986), Pub. L. 99-514, 100 Stat. 2085, does not apply to tax the alleged sec.

Commissioner, supra, are distinguishable from the facts in this case and that the criminal tax investigation of Mr.

301-307) applies. Sec. 355(a)(1), if applicable to this case, would provide an exception to dividend treatment under sec. 301 and, therefore, an exception to the application of sec. 311(b). See sec. 355(c)(3). We note, in passing, that, because Ridge’s S corporation election was made on, not after, Dec. 31, 1986, sec. 1374, as amended by the Tax Reform Act of 1986 (TRA of 1986), Pub. L. 99-514, 100 Stat. 2085, does not apply to tax the alleged sec.

301-307) applies. Sec. 355(a)(1), if applicable to this case, would provide an exception to dividend treatment under sec. 301 and, therefore, an exception to the application of sec. 311(b). See sec. 355(c)(3). We note, in passing, that, because Ridge’s S corporation election was made on, not after, Dec. 31, 1986, sec. 1374, as amended by the Tax Reform Act of 1986 (TRA of 1986), Pub. L. 99-514, 100 Stat. 2085, does not apply to tax the alleged sec.

301 of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1452, 1457 (1996), to permit the Secretary to abate interest with respect to an "unreasonable" error or delay resulting from "managerial" and ministerial acts. This amendment, however, applies to interest accruing with respect to deficiencies or payments for tax years beginning after July 30, 1996; therefore, the amendment is inapplicable to the case at bar.

- 24 - Petitioners contend that section 301.6231(a)(5)-1T, Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987), neither mentions section 469 nor suggests that the characterization of losses as passive or nonpassive be treated as an affected item. From such silence petitioners conclude that the section 469 issue involves a nonpartnership item within the meaning of section 6231(a)(4), to which section 6229 does not apply.

As of that date, petitioners had proposed no collection alternative, had ne- glected to submit Form 433–A or 656, and had submitted no financial 2 Petitioners’ pleadings are not a model of clarity, and it is unclear whether they continue to advance a claim to “innocent spouse” relief.

e)(2)(iii) states that the administrative claim file should include any Form 11369 prepared with respect to the whistleblower’s case, “including narratives prepared by the relevant IRS office(s), explaining the whistleblower’s contributions to the actions and documenting the actions taken by the 21 We express no view on the potential relevance of these IRM directives had they been in effect at any relevant time.

We need not decide this issue because we conclude below that neither of the remaining conditions in section 6229(e)(2) is satisfied.

We need not decide whether the SO’s resolution of petitioner’s spousal defense challenge should be reviewed de novo rather than for abuse of discretion.

at 167; emphasis added.] While we note that it is unclear whether taxpayer 1 was independently evaluated by an operating division, it is clear that taxpayers 1, 2, and 3 are all related.

We need not decide whether this agreement was valid.

There is no dispute in this case that 6Because Semone died in 2014, we need not decide whether section 301.7701-18(b)(2), Proced.

at 99, the Court stated that, “[a]lthough it is unclear whether the ‘notice’ refers to the NBAP or the FPAA, because the FPAA is the later notice in this case, we will presume the FPAA is the operative notice.” This Court also added in a footnote: “The current regulation clarifies that the FPAA is the operative notice, but that regulation became effective on Oc

- 9 - [*9] Because petitioners' administrative costs were incurred before the Appeals Office issued the notice ofdetermination, they do not constitute "reasonable administrative costs." In the light ofthis conclusion, we need not decide whether petitioners were prevailing parties in the administrative proceeding.

However, we need not decide that issue because the scope ofreview does not affect the result.

We recently expressed reservations about the analysis in those opinions.

Given our disposition, we need not decide this threshold question.

It is unclear whether petitioner was entitled to challenge his liabilities for 2011 and 2013 at the CDP hearing.6 However, petitioner did not challenge his underlying liabilities at the CDP hearing or in his petition.

Accordingly, we need not decide whether our scope ofreview is limited to the administrative record.

Because we find SO Rieux did not abuse her discretion even assuming these facts we need not decide whether these assertions are sufficient to put these facts in issue, however.

Because ofour holding, we need not decide whetherpetitioner was the prevailing party.

'Even if petitioners had proved that they were unable to pay their 2005 Federal income tax liability when it was due without suffering undue hardship, we are not convinced that they exercised ordinary business care and prudence ::ba providing for payment of the liability.

We disagree with each of petitioners’ arguments and will explain below.

Regarding the first ground, we disagree with the Glasers’ argument that it is satisfied.

We disagree with petitioners and hold that respondent timely issued the affected items Notices of Deficiency.

We disagree with petitioners.

We do not agree with petitioners’ position.

48 (2007), was incorrectly decided, we are bound by our Court's precedent.27 26Lewis v.

was incorrectly decided.

We disagree with petitioner.

Regs., which states that "the CDP hearing requested under section 6320 will be held in conjunctionwith any CDP hearing the taxpayerrequests under section 6330." We disagree with respondent's application ofsection 301.6320-1(d)(1), Proced.

We disagree with petitioners' assertions that the IRS failed to give proper notice ofthe FPAA and that the deficiency notice is invalid.

We disagree with respondent.

- 11 - We disagree with petitioners’ interpretation of the December 1995 letter.

We do not agree with petitioner that Congress intended to exclude from the definition of a “deficiency” taxes which are determined by respondent for a nonfiling taxpayer.

Accordingly, we hold respondent’s additional tax assessment of $20,904 against petitioners was invalidly made since no Notice of Deficiency was issued.

at 115 (“We hold today that we do not have authority to consider section 6330(c)(2) issues that were not raised before the Appeals Office.”); Mongogna v.

Accordingly, we hold that petitioners are liable for the 10% additional tax.

Because the parties stipulated that the IRS filed substitutes for returns pursuant to section 6020(b) and because petitioners did not argue (on brief or otherwise) that the substitutes for returns referenced in the stipulation did not meet the requirements of Treasury Regulation § 301.6020-1(b)(2), we hold that petitioners waived the argument that the IRS did not prepare valid substitutes for returns under 6020(b) and we treat the Forms 4549-A and 886-A prepared for William and Mary as their sub

We hold that the WBO did not abuse its discretion in determining that this negative factor was present.

Cindy and the Estate of Chet Huffman had ordinary dividend income pursuant to section 301, which provides that a dividend is taxed as ordinary income only to the extent of the distributing corporation’s earnings and profits.

Consistent with that conclusion in Belair Woods that penalty principles properly inform our construction of “reasonable cause” under the substantiation provisions of section 170(f)(11)(A)(ii)(II), we hold that the determination of which party bears the burden of proof on reasonable cause under the substantiation provisions depends (as it does for penalty liability) on whether the Commissioner’s contention of noncompliance with the substantiation provisions is new matter.

Consistent with that conclusion in Belair Woods that penalty principles properly inform our construction of “reasonable cause” under the substantiation provisions of section 170(f)(11)(A)(ii)(II), we hold that the determination of which party bears the burden of proof on 26 [*26] reasonable cause under the substantiation provisions depends (as it does for penalty liability) on whether the Commissioner’s contention of noncompliance with the substantiation provisions is new matter.

Because we hold that Zaimes did not have reasonable cause for his failure to timely file, we need not determine whether his failure was due to willful neglect.

Therefore, we hold that these regulations apply to this case.

We hold that this ASFR Certification satisfies the requirements of section 6020(b) and that respondent has met his burden of production in this respect.

We hold that the six-year statute of limitations for assessment under section 6501(e)(1)(A) was suspended by the operation of section 7609(e) because of the issuance of the UBS John Doe summons.

Section 301 governs distributions of property by a corporation to its share- holders.4 Not all payments from a corporation to a shareholder, however, consti- 3Petitioners in any event would have great difficulty disputing the compen- satory character of the life insurance arrangement under the “law of the case” doc- t

Accordingly, we hold as a matter of law that the WBO did not abuse its discretion in denying a whistleblower award.

In that case, the redemption would be treated under section 302(d) "as a distribution of property to which section 301 applies." As such, the distribution would be treated as a dividend to the extent of petitioner's earnings and profits as of the end of 2009.

What we hold is that the Masons did make an offer that should have been considered on its merits by SO Rush.

23The regulations at several points describe rejections of claims “pursuant to § 301.7623-1(b) or (c)” without mentioning rejections on other grounds.

In that case, the redemption would be treated under section 302(d) "as a distribution of property to which section 301 applies." As such, the distribution would be treated as a dividend to the extent of petitioner's earnings and profits as of the end of 2009.

Consistent with our analysis above regarding survival of the petitioner-whistleblower’s claim, we hold that the estate has standing to pursue that section 7623(b) claim.

Respondent contends that pursuant to section 301.6231(c)-7(b), Proced.

We hold that the IRS has not abused its discretion in denying interest abatement for this four-day period, Period 18, because the statutoryprerequisites ofsection 6404(e)(1) have not been met.

y or issue concerning partnership items relevant to these cases, and the Commissioner failed to raise or present any issue as to any such item or a pending partnership audit (which under TEFRA would preclude us from deciding the instant cases until the TEFRA partnership case was resolved), and thus we hold the matterto be conceded.

y or issue concerning partnership items relevant to these cases, and the Commissioner failed to raise or present any issue as to any such item or a pending partnership audit (which under TEFRA would preclude us from deciding the instant cases until the TEFRA partnership case was resolved), and thus we hold the matterto be conceded.

Kukreja, we hold that she did not exercise ordinary business care and prudence in providing for payment ofher tax liabilities, and we do not find persuasive the reasons she - 76 - [*76] advances in support ofreasonable cause (the same as under section 6651(a)(1), above).

y or issue concerning partnership items relevant to these cases, and the Commissioner failed to raise or present any issue as to any such item or a pending partnership audit (which under TEFRA would preclude us from deciding the instant cases until the TEFRA partnership case was resolved), and thus we hold the matterto be conceded.

107, 115 (2007) ("We hold today that we do not have authorityto consider section 6330(c)(2) issues that were not raised before the Appeals Office."); sec.

The Eleventh Circuit opinion held that these regulations and another regulation, section 301.6320-1(e)(4), Example (3), Proced. & Admin. Regs., "require the IRS to make a pre-assessment detennination (though not necessarily through the provision ofa hearing) about a taxpayer's § 6672(a) liability when timely protest is made." Romano-Murphyv. Commissioner, 816 F.3d at 717. The Eleventh Circuit also stated that its interpretation ofsection 6672(b)(3) was consistent with section 601.106(a)(1)(iv),

We hold that they are liable for additions to tax for failure to file timely for the years at issue as determined by respondent.

Therefore, we hold that SO Andrews wasjustified in concluding that the statutory notices ofdeficiency were - 20 - [*20] sent to petitioner's last known address and were accordingly valid.

However, we hold that Emery PC has shown that its failure to timely file a Form 941, pay the tax thereon, or make timely employment tax deposits for 1Q 1999 was due to reasonable cause.

Petitioners sought to make a late election, but they did not file an amended income tax return for 2014 that included a statement requesting an election.3 Pursuant to section 301.9100-3(a), Proced.

Section 301 provides that funds distributed by a corporation over which the taxpayer/shareholderhas dominion and control are taxed under section 301(c).

Petitioners sought to make a late election, but they did not file an amended income tax return for 2014 that included a statement requesting an election.3 Pursuant to section 301.9100-3(a), Proced.

- 43 - [*43] The Supreme Court has held that a taxpayer's reasonable reliance on the advice ofa tax professional regarding a question oflaw, even when the advice turns out to be a mistake, may constitute reasonable cause and is consistent with ordinary business care and prudence.46 However, it is the taxpayer's obligation to supply his or her tax professional with complete and accurate records from which to make a reasonable estimate oftax liability.47 We are skeptical that Mr.

Pursuant to section 301.6320-1(b)(1) and (2), Proced.

Section 301 requires a taxpayerto include in gross income amounts received as dividends.

Section 301 requires a taxpayerto include in gross income amounts received as dividends.

Section 301 requires a taxpayerto include in gross income amounts received as dividends.

Section 301 requires a taxpayerto include in gross income amounts received as dividends.

But once we hold an item is a partnership item we havejurisdiction to determine that partnership item regardless ofwhether the Commissioner adjusted it in the FPAA.

As discussed above, we hold that the filing ofthe NFTLs was in accordance with IRS administrative procedures.

-18- [*18] assessment does not mean that no signed summary record ofassessment exists.¹° Under these circumstances, we hold that (1) the assessment was valid and (2) the Appeals Office did not abuse its discretion in concluding that it had verified that the assessment had been properly made.

That information constitutes all of"the pertinent parts ofthe assessment", which, pursuant to section 301.6203-1, Proced.

Tucker had failed to provide the necessary financial information for Appeals to determine his RCP and - 23 - [*23] consider his OIC--and we hold that neither ofthese determinations constituted an abuse ofdiscretion.

We hold thatthe companyhas not satisfied its burden ofproving that the failures were due to reasonable cause.

Accordingly, we hold there was no ministerial or managerial error or delay that caused the interest to be charged, and the IRS did not abuse its discretion when it declined to abate the interest.

In conclusion, we hold that SO Martin reasonably determined that the proposed monthlypayment did not reflect petitioner's ability to pay.

We hold that McCauley is not entitled to recover any costs because she was not the prevailing party in her dispute.

- 4 - [*4] entities involved in these consolidated cases (together, LLCs), are New York limited liability companies that, pursuant to section 301.7701-3(b)(1)(i), Proced.

But once we hold an item is a partnership item we havejurisdiction to determine that pa tnership item regardless ofwhetherthe Commissioner adjusted it in the FPAA.

We hold that Barnes should have included the amounts in gross income under section 301; (2) whether the fair market value of "clean rooms" transferred to Barnes in 2001 should be excluded from its income under section 109.

Accordingly, we hold that petitioner is liable for the section 6651(a)(2) addition to tax for 2005.

Accordingly, we hold that petitioners are liable for the section 6651(a)(2) additions to tax.

We hold that Jones is liable for the section 6651(a)(2) addition to tax.

Constructive Dividends Section 301 requires a taxpayerto include in gross income amounts received as dividends.

Section 301 requires a taxpayerto include in gross income amounts' received as dividends.

Courts have consistently held that the standard to be applied in section 6651 is one of"ordinary business care and prudence", as required by section 301.6651-1(c)(1), Proceed.

We hold that S corporations are not individuals for purposes ofsection 36.

We hold that Goyak & Associates may not deduct the payment, as it is not an ordinary and necessary business expense under section 162 (a) ; (2) whether the $1.4 million paid to the Millennium Plan is taxable to Mr.

However, section 301 provides that funds (or any other property) distributed by a corporation to a shareholder over which the shareholder has dominion and control are to be taxed under the provisions ofsection 301(c).

ide for each year in issue: whether gain from the sale ofstock held by petitioner qualifies for deferral under section 1045 (allowing a taxpayer in certain circumstances to elect to defer taxation ofthe gain on sales ofqualified small business stock); and whetherpetitioner should have been granted, pursuant to section 301.9100-3, Proced.

Section 301 requires a taxpayer to include in gross income amounts received as dividends.

Accordingly, we hold that petitioners are liable for the addition to tax under section 6651(a)(1) for 2004, 2005, 2006, and 2007 to the extent applicable as a result ofthe parties' computations under Rule 155.

section 301.6651-1(c)(1) provides: ''Ifthe taxpayer exer ised ordinary business care and prudence and was nevertheless unable to file the r turn withinthe prescribed time, then the delay is due to a reasonable cause." We hold that the failure ofan S corporation to timely file its annual return is due to r asonable cause ifthe S corporation exercised ordinary business care and prudence and was nevertheless unable to timely file its return.

2009-160, we held that "questions about whether a particular check was properly credited to a particular taxpayer's account for a particular tax year are not challenges to his underlying tax liability". See also Orian v. Commissioner, T.C. Memo. 2010-234. Our holding in Kovacevich is consistent with our interpretation of the phrase "underlying tax liability" in prior cases, whère we determined that the "underlying tax liability" challenged by a taxpayer under section 6330(c) (2) (:B) refers to a

- 11 - The guidance was silent as to when and how the communication had to be sent.' -We hold that the Commissioner must demonstrate either mailing or spersor.al delivery of a denial letter to the whistleblower's-Jast known address.

It follows, and we hold, that the net income arising from his psychiatric practice during the years in issue, including any amounts paid to Robucci P.C.

Rules Applicable to Distributions Under section 301, funds (or other property) distributed by a corporation to a shareholder with respect to its stock are taxable under section 301(c).

Respondent also.contends that if we hold that petitioners are entitled to litigation and administrative costs, petitioners are not entit:led to the amount claimed.

Therefore, we hold that petitioner is liable for an addition to tax under section 6651(a) (2).

Accordingly, we hold that it was an abuse of discretion for respondent's settlement officer to refuse to enter into an installment agreement on the basis of petitioner's failure to stay current with its tax deposits where respondent's abuse of discretion in refusing to consider subordination of the NFTL contributed to

Petitioners conclude that pursuant to section 301.6871(a)-2, Proced.

ides the following example: if a corporation having only common stock outstanding, exchanges one share of newly issued common stock and one bond in the principal amount of $10 for each share of outstanding common stock, the distribution of the bonds will be a distribution of property * * * to which section 301 applies, even though the exchange of common stock for common stock may be pursuant to a plan of reorganization under the terms of section 368(a) (1) (E) (recapitalization) and even though

Constructive Dividend Section 301 requires a taxpayer to include in gross income amounts received as dividends.

Rules Applicable to Distributions Under section 301, funds (or other property) distributed by a corporation to a shareholder with respect to its stock are taxed under section 301(c) .

We hold, therefore,-that we lack jurisdiction to redetermine respondent's computational adjustments for 1995 in this proceeding .

Accordingly, Paradym is disregarded pursuant to section 301 .7701- 3(b)(1)(ii), Proced .

The Court held that petitioner was not entitled to a face-to-face levy hearing pursuant to section 301 .6330-1(d)(2), Q&A-D8, Proced .

Pursuant to section 301 .9100-3(a), Proced .

Respondent concedes in his second response that petitioners are deemed to have exhausted the available administrative remedies , pursuant to section 301 .7430-1(f)(2), Proced.

issues we must decide are: (1) Whether petitioners properly elected to exclude, pursuant to section 108(c)(3)(C), $519,413 in cancellation of - 2 - indebtedness income as a distributive share of the partnership Capital Concepts Properties 84-A; (2) if not, whether petitioners should be permitted, pursuant to section 301.9100-3, Proced.

4 To the extent that such distribution is treated as a distribution to which section 301 applies, the.

As discussed above, we hold that section 301 .6231(a)(3)-l(b), - 22 - Proced.

Accordingly, we hold that petitioner knew or should have known that the tax returns for 1997 through 1999 reported unpaid liabilities and that Mr .

Accordingly we hold that petitioner knew or should have known that the tax returns for 1998, 1999, and 2000 reported unpaid liabilities and that Mr .

Regs ., we hold that 12 days was insufficient time for petitioners to petition this Court for redetermination of the notice of deficiency .

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 .

Consistent with the foregoing, we hold that petitioner is barred by section 6330(c)(4) from attempting to raise her claim for relief under section 6015 in this proceeding.

Pursuant to section 301.6343-1(b)(4)(ii), Proced.

Respondent asserts that pursuant to section 301.6343- 1(b)(4)(ii), Proced.

Pursuant to section 301.6343-1(b)(4)(ii), Proced.

Pursuant to section 301.6343-1(b)(4)(ii), Proced.

Accordingly, we hold that petitioners and respondent did not enter into a binding agreement to waive - 17 - all additions to tax.

Pursuant to section 301(c), a - 9 - dividend is taxed as ordinary income only to the extent of the distributing corporation’s earnings and profits;3 any excess is a nontaxable return of capital to the extent of the taxpayer’s basis; and any remaining amount received is taxable as capital gain from the sale or exchange of

Pursuant to section 301(c), a - 9 - dividend is taxed as ordinary income only to the extent of the distributing corporation’s earnings and profits;3 any excess is a nontaxable return of capital to the extent of the taxpayer’s basis; and any remaining amount received is taxable as capital gain from the sale or exchange of

In sum, we hold for respondent as to all of the substantive matters in dispute.

Regs., we hold that for purposes of determining an overpayment of tax pursuant to section 6512(b), the proper tax includes underpayment interest and that the amount of an overpayment is "The Chief Counsel's National Office echoes this position in field service advice: "Although payments of underpayment interest a

As stated by respondent on brief, pursuant to section 301.7701-3(g)(1)(ii) and (2)(i), Proced.

Respondent asserts that pursuant to section 301.6343- 1(b)(4)(ii), Proced.

Given that the applicable Federal M&IE rate for 1999 is $30 per day, we hold that petitioners’ deduction for Mr.

(Lents) was a redemption involving a related corporation under section 304 (a) (1) of the Internal Revenue Code of 1954 and, if so, whether the redemption should be treated as a distribution in exchange for the redeemed stock under section 302(a) or as a distribution to which section 301 applies.

We hold that respondent did not abuse his discretion in deciding that it is not inequitable to hold petitioner jointly and severally liable for any remaining portions of the joint income tax liabilities for 1982, 1983, and 1984.

We hold that we have jurisdiction.

It was the position of the Service that the substance of the transaction was a redemption of the stock from the taxpayer, taxable under section 301 of the Code, followed by a gift of the redemption proceeds by the taxpayer to the foundation.

In view of the foregoing, we hold that petitioner is liable for the additions to tax under section 6651(a)(1) as determined by respondent in the notices of deficiency.

We hold that, under the circumstances of these cases, respondent is not obligated to extend to petitioners an offer of settlement consistent with the terms of settlement agreements made with other Jojoba partners.

We hold that, under the circumstances of these cases, respondent is not obligated to extend to petitioners an offer of settlement consistent with the terms of settlement agreements made with other Jojoba partners.

Accordingly, we hold that petitioner's costs incurred in preparing and correcting petitioner's tax returns are not recoverable pursuant to section 7430.

In opposition, petitioners state that, pursuant to section 301.7430-1(e)(2), Proced.

The Court of Appeals held that the implementing regulation, section 301 .6404-2(a)(1)(i), Admin .

Petitioner contends that, although Petito -3- corporation would normally be excepted from the unified S corporation audit and litigation procedures as a “small S corporation” within the meaning of section 301.6241-1T(c)(2)(ii), Temporary Proced.

. 1995). - 9 - T.C. 1279, 1284 (1986); Maxwell v. Commissioner, 87 T.C. 783, 789 (1986). Partnership items include each partner's proportionate share of the partnership's aggregate items of income, gain, loss, deduction, or credit. Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1(a)(1)(i), Proced. & Admin. Regs. A nonpartnership item is defined as an "item which is (or is treated as) not a partnership item." Sec. 6231(a)(4). These items are subject to the general procedures applicable to audits, deficien

To elect into the BBA procedures for years before 2018, a partnership must submit to the Commissioner an election under Treasury Regulation § 301.9100-22(b)(2) that satisfies the requirements set forth in that regulation. Because SN Worthington complied with the plain text of the regulation, it made a valid election into the BBA procedures. As a result, the TEFRA procedures are inapplicable, and the Commissioner’s FPAA is invalid. Further, petitioner is not equitably estopped from arguing that t

In the written Report he submitted following the hearing, respondent confirmed that position, stating he “does not believe that petitioners should be precluded from making a reasonable cause argument if they didn’t submit a written statement to the Service.” Respondent suggests that Kuretski may be distinguishable because it involved review of a determination by the Commissioner to collect taxes by levy, the scope of which may have been “limited to the administrative record.”74 4. Analysis We be

§ 301.7701-3(a); see also DAF Charters, LLC v. Commissioner, 152 T.C. 250, 259–60 (2019) (and cases cited thereat). The check-the-box regulations do not always grant entity owners a choice, though, listing some types of entities that are irrevocably considered corporations. DAF Charters, LLC, 152 T.C. at 260 (citing Treas. Reg. § 301.7701-2(b)). Entities not in this list may elect their treatment, and the regulations provide default options for entities that fail to choose. Id. (citing Treas. Re

The whistleblower has 30 days from the date the WBO sends the PARL to respond by agreeing to the preliminary award recommendation (and thus waiving any and all administrative and judicial appeal rights), requesting a detailed report and opportunity to review supporting documentation, adding comments to the administrative claim f

Petitioner states that “[a] future innocent spouse claim is similar to the carryback of net operating losses.” But unlike net operating loss carryovers not in issue when an offer is made and applied after a qualified offer is accepted to reduce payment for the years in issue, the right to relief from liability under section 6015 that petitioner reserved in her offer affects the amount of her liabilities—the assessed deficiencies—for the years in issue; it is not merely a carryover item applied l

Unlike the rules governing CDP hearings, the rules applicable to equivalent hearings are not established by statute. See Craig v. Commissioner, 119 T.C. at 258. Equivalent hearings are instead governed by “regulations implementing Congressional intent as gleaned from * * * [the legislative] history” of section 6330. See id. Those regulations explain that, to obtain an equivalent hearing, “[a] taxpayer must submit a written request for an equivalent hearing within the one- year period commencing

eligibility under the regulations.10 The personnel tasked with the initial evaluation of the whistleblower’s submission perform a “basic check of a claim against specified criteria,” not a substantive review of its merits.11 These criteria include 8Sec. 301.7623-3(b)(3), Proced. & Admin. Regs. 9Sec. 301.7623-3(c)(7), Proced. & Admin. Regs. 10Sec. 301.7623-3(c)(7), Proced. & Admin. Regs. In Lacey v. Commissioner, 153 T.C. at 162-163, we distinguished between a rejection made by the Whistleblower

The analyst evaluated the positive and negative factors in section 301.7623-4(b), Proced.

301.7701-3(a), Proced. & Admin. Regs. On November 29, 2012, Gluck LLC executed a contract in which it purport- ed to acquire, for $4,625,000, a 12.5% interest in the Property. The contract lists the purchaser as Gluck LLC and the seller as the estate ofArthur D. Emil. The contract describes the asset thus acquired as an "undivided interest of

Section 301.6231(c)-6(a), Proced. & Admin. Regs., provides: The treatment ofitems as partnership items with respect to a partner whose taxable income is determined by use ofan indirect method of proofofincome will interfere with the effective and efficient enforcement ofthe internal revenue laws. Accordingly, partnership items ofsuch a partner aris

In determining whether the taxpayer had an opportunity to dispute his liability, we note that the regulations distinguish between liabilities that are subject to deficiency procedures and those that are not. Penalties imposed under section 6698(a) are not subject to deficiency procedures. See sec. 6698(d). With respect to such liabilities the regulations provide that "[a]n opportunity to dispute the underlying liability includes a prior opportunity for a conference with Appeals that was offered

301.7701-2(e)(5), Proced. & Admin. Regs. Before then, the owner ofa disregarded entity was ultimately liable for employment taxes on wages paid by the entity but could choose whetherthe owner or the entity would be responsible for calculation, reporting, and payment ofthat liability. Notice 99-6, 1999-1 C.B. 321. The Department ofthe Treasury's °On November 1, 2011, in order to extend the FICA and Federal Unemployment Tax Act exceptions for family members and religious sect members to certain en

However, we need not address the discrepancies in these rulings today as we can clearly distinguish the present case from our decision in Buffano. In Buffano v. Commissioner, 2007 WL 424705, at *1, the record included information showing the address appearing on the taxpayer's most recently filed Federal income tax return. This is the starting point for establishing a taxpayer's last known address. See Kennedy v. Commissioner, 116 T.C. 255, 260 n.4 (2001); Abeles v. Commissioner, 91 T.C. 1019, 1

301.6331-4(b)(1), Proced. & Admin. Regs. A notice ofintent to levy is an action other than a levyto protectthe interests ofthe Government; unlike a levy, it is merely preliminaryto a collection actio'n, rather than a collection action barred by section 6331(k)(2). See Politte, 2009 WL 3166924, at *5. Accordingly, under the regulations, consistent with the plain language ofthe statute, the IRS was not prohibited from issuing the notices ofintent to levy afterpetitioner submitted his offer for an

301.7502-1(c)(1)(iii)(A),Proced. & Admin. Regs. ("Ifthe postmark on the envelope is made by the U.S. Postal Service but is not legible, the person who is required to file the document or make the paymenthas the burden ofproving the date that the postmarkwas made."). Alternatively, section 301.7502-1(c)(2), Proced. & Admin. Regs., provides as follows: Registered or certified mail. Ifthe document or payment is sent by U.S. registered mail, the date ofregistration ofthe document or payment is treat

Pet-itioner argues that while section 6229(e) merely requires information identifying a partner to be "furnished" to the Commissioner, section - 47 - 301.6223(c)-1T, Temporary Proced. & Admin. Regs., supra, restricts the plain meaning ofsection 6229(e) by requiring that identifying information be "filed" with the Commissioner. Petitioner also points out that section 6229(e) contains no "regulation-enabling language". We find that section 301.6229(e)-1T, Temporary Proced. & Admin. Regs., supra,i

section 7502 the date ofa legible U.S. postmark is treated as the date ofdelihery when actual delivery occurs beyond the date required for filing, see, e.g., Shipley v. Commissioner, 572 F.2d 212, 213-214 (9th Cir. 1977), aff'g T.C. Memo. 1916-383; sec. 301.7502-1(c)(1)(iii), Proced. & Admin. Regs., section 7502 does not help petitioner here because the U.S. postmark on the envelope containing the petition is November 17, 2009. _9_ Ourjurisdiction to review a collection action determination und

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

The so-called check-the-box regulation, section 301.7701-3(a), Proced.

301-11.18 (2004) and 41 C.F.R. se~c. 301-11;18 (2005) . She spent 147 days in harbor and at sea during 2004 and 200 days in harbor and at sea in 2005, resulting in a' deduction of $441 in 2004 and $600 in 2005. Madsen argues that, as an alternative to use of the special daily rates for transportation industry workers, her deduction "Madsen also argues that she is entitled to the unreduced. meal and incidental expense deduction in harbor and at sea because she believes she received meals from a c

that petitioner’s offer not be considered a qualified offer because petitioner failed to provide respondent with the substantiation and legal and factual arguments necessary for informed consideration of petitioner’s claim for relief as required by sec. 301.7430-7(c)(4), Proced. & Admin. Regs. - 13 - provision to mean that if a case is not removed from the trial calendar more than 30 days before the case is set for trial, then a continuance will not serve to extend the qualified offer period. S

retary may compromise any civil * * * case arising under the internal revenue laws”. Whether to accept an offer-in-compromise is left to the Secretary’s discretion. Fargo v. Commissioner, 447 F.3d 706, 712 (9th Cir. 2006), affg. T.C. Memo. 2004-13; sec. 301.7122-1(c)(1), Proced. & Admin. Regs. The regulations under section 7122(a) set forth three grounds for the compromise of a tax liability: (1) Doubt as to liability; (2) doubt as to collectibility; or (3) promotion of effective tax administrat

that petitioner’s offer not be considered a qualified offer because petitioner failed to provide respondent with the substantiation and legal and factual arguments necessary for informed consideration of petitioner’s claim for relief as required by sec. 301.7430-7(c)(4), Proced. & Admin. Regs. - 13 - provision to mean that if a case is not removed from the trial calendar more than 30 days before the case is set for trial, then a continuance will not serve to extend the qualified offer period. S

der section 6402 does not constitute a levy action and accordingly is not a collection action that is subject to review in this section 6330 proceeding. Bullock v. Commissioner, T.C. Memo. 2003-5; see Boyd v. Commissioner, 124 T.C. 296, 300 (2005); sec. 301.6330-1(g)(2), Q&A-G3, Proced. & Admin. Regs. (an offset is a nonlevy collection action that the Internal Revenue Service may take during the suspension period provided in section 6330(e)(1)). In the instant case, unlike in Chocallo v. Commiss

492, 502-503 (1987), to argue that they fall within the purview of the exception under section 301.7430-1(f)(2), Proced. & Admin. Regs. In Minahan, however, the taxpayers did not receive a 30- day letter. Minahan v. Commissioner, supra at 502. Petitioners do not argue that they did not receive a 30-day letter from respondent. Regardless of the letter from the Appeals Office dated May 12, 2005, the 30-day letter clearly gave petitioners an opportunity to seek an Appeals Office conference prior to

Petitioners and SPK each filed Form 3115, Application for Change in Accounting Method, with respondent and noted at the top that the forms were filed pursuant to section 301 .9100-2, Proced.

egulations adopted pursuant to section 7122 set forth three grounds for the.compromise of a liability: (1) Doubt as to liability; (2) doubt as to collectibility; or (3) promotion of effective tax administration. Speltz v. Commïssioner, supra at 172; sec. 301.7122-1, Proced. & Admin. Regs. In her petition, petitioner asserts that there was an abuse of discretion as to all three grounds, although she pursued only promotion of ETA at the CDP hearing. Generally, we may consider only those issues tha

cretary may compromise any civil * * * case arising under the internal revenue laws”. Whether to accept an offer-in-compromise is left to the Secretary’s discretion. Fargo v. Commissioner, 447 F.3d 706, 712 (9th Cir. 2006), affg. T.C. Memo. 2004-13; sec. 301.7122-1(c)(1), Proced. & Admin. Regs. The regulations set forth three grounds for the compromise of a tax liability: (1) Doubt as to liability; (2) doubt as to collectibility; or (3) promotion of effective tax administration. Sec. 301.7122-1(

301.6402-3(a)(5), Proced. & Admin. Regs. However, the regulations mirror the statute and authorize the IRS to override that election and apply the overpayment against “any outstanding liability for any tax”. Sec. 301.6402-3(a)(6)(i), Proced. & Admin. Regs.; see N. States Power Co. v. United States, 73 F.3d 764, 767 (8th Cir. 1996) (citing In r

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987). We apply an abuse of discretion standard in reviewing the Commissioner's determination not to abate interest. Lee v. Commissioner, 113 T.C. 145, 149 (1999); Krugman v. Commissioner, 112 T.C. 230, 239 (1999). To be eligible for relief under section 6404(e),

pply in the present case. Id. sec. 301(c). - 7 - during the processing of a taxpayer's case after all prerequisites to the act, such as conferences and review by supervisors, have taken place. Lee v. Commissioner, 113 T.C. 145, 150 (1999); see also sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987). Abatement is available under section 6404(e) only for periods after the IRS has contacted the taxpayer in writing with respect to the deficiency or payment.

301.6404-2(b)(2), Proced. & Admin. Regs. An error or delay by the Commissioner can be taken into account only if: (1) It occurs after the Commissioner has contacted the taxpayer in writing with respect to the deficiency, and (2) no significant aspect of the error or delay is attributable to the taxpayer. See sec. 6404(e)(1); Krugman v. Commissioner, 112 T.C. 230, 239 (1999); Hawksley v. Commissioner, T.C. Memo. 2000-354. Section 6404(e)(1) "does not therefore permit the abatement of interest for

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).8 In contrast, a decision concerning the proper application of Federal tax law, or other applicable Federal or State laws, is not a ministerial act. See sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., supra. In the legislative history of section 6404(e), Congress observed that “issuing either a statutory notice of deficiency or 7Sec. 6404(e) was amended by the Taxpayer Bill of Rights 2, Pub. L. 104-

xercise of judgment or discretion and that occurs during the processing of a taxpayer’s case after all prerequisites to the act, such as conferences and review by supervisors, have taken place. Lee v. Commissioner, 113 T.C. 145, 150 (1999); see also sec. 301.6404- 2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987). Abatement is available under section 6404(e) 7 Congress amended sec. 6404(e) in 1996 to permit abatement of interest for “unreasonable” error or delay in p

404(e)(1) and (g)(1). Under preamendment section 6404(e),2 the Commissioner “may abate the assessment of interest on any payment of tax to the extent that any error or delay in payment is attributable to an 2 In 1996, sec. 6404(e) was amended under sec. 301 of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1457 (1996), to permit the Secretary to abate interest with respect to an “unreasonable” error or delay resulting from “managerial” and ministerial acts. This amendment, however, ap

2000-15 is conducted using rules similar to those under section 301.6343- 1(b)(4), Proced.

For purposes of this section, the determination of whether a requesting spouse will suffer economic hardship will be made by the Commissioner or the Commissioner’s delegate, and will be based on rules similar to those provided in § 301.6343-1(b)(4) of the Regulations on Procedure and Administration.

2000-15, supra, is conducted using rules similar to those under section 301.6343-1(b)(4), Proced.

Petitioner based this assertion on his claim that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

ocedural or mechanical act that does not involve the exercise of judgment or discretion, and that occurs during the processing of a taxpayer’s case after all prerequisites to the act, such as conferences and review by supervisors, have taken place.” Sec. 301.6404- 2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 1 Sec. 6404(e) was amended by sec. 301(a)(1) and (2) of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1457 (1996), to permit the Commissioner to abate interest

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

writing with respect to such deficiency or payment. Congress amended sec. 6404(e) in 1996 to permit abatement of interest for “unreasonable” error or delay in performing a “managerial” or ministerial act. Taxpayer Bill of Rights 2, Pub. L. 104-168, sec. 301, 110 Stat. 1457 (1996). This amendment applies to interest accruing with respect to deficiencies or payments for tax years beginning after July 30, 1996, and thus does not apply in the instant case. See Woodral v. Commissioner, 112 T.C. 19,

oes not involve the exercise of judgment or discretion and that occurs during the processing of a taxpayer's case after all prerequisites to the act, such as conferences and review by supervisors, have taken place. Lee v. Commissioner, supra at 150; sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987). This Court has jurisdiction to order an abatement of interest only when the Commissioner has abused his discretion in refusing a taxpayer's request to abate

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

volve the exercise of judgment or discretion and occurs during the processing of a taxpayer’s case after all the prerequisites to the act, such as conferences and review by supervisors, have taken place. See Lee v. Commissioner, 113 T.C. 145 (1999); sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).5 In contrast, a decision concerning the proper application of Federal tax law, or other applicable Federal or State laws, is not a ministerial act. 4Sec. 64

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

he ACS employee did not enter into a binding agreement to compromise petitioners’ liabilities. - 8 - When the first and second calls were made, a liability could be compromised only if there was doubt as to liability or doubt as to collectibility.6 Sec. 301.7122-1(a), Proced. & Admin. Regs. Petitioners’ liability was not in doubt at the time of the “agreement” because petitioners had filed the tax returns calculating the taxes due and were not contesting the accuracy of the returns. Petitioners

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Petitioners contend that section 6231(c) and section 301.6231(c)-5T, Temporary Proced.

Under section 301, the distribution is treated as a dividend if it meets the requirements of section 316. Under section 316(a), dividends are taxable to the shareholder as ordinary income to the extent of the earnings and profits of the corporation, and any amount received by the shareholder in excess of earnings and profits is considered a nontaxable re

in writing with respect to such deficiencies.3 Ministerial acts are described as procedural or mechanical acts that do not involve the exercise of judgment or discretion by respondent. See, e.g., Crawford v. Commissioner, T.C. Memo. 2002-10 (citing sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987)4). The denial by respondent of the requested transfer of petitioner’s appeal from respondent’s San Francisco Appeals Office to either the Fresno or Brooklyn

of the delay can be attributed to her. Petitioner has failed to do so. Respondent’s determination that the 1988 liability should be classified as uncollectible required the exercise of discretion and judgment. Hence it was not a ministerial act, see sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987), and cannot provide the requisite basis for abating interest under section 6404(e). Moreover, even if we were to assume, for sake of argument, that responden

in writing with respect to such deficiencies.3 Ministerial acts are described as procedural or mechanical acts that do not involve the exercise of judgment or discretion by respondent. See, e.g., Crawford v. Commissioner, T.C. Memo. 2002-10 (citing sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987)4). The denial by respondent of the requested transfer of petitioner's appeal from respondent's San Francisco Appeals Office to either the Fresno or Brooklyn

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987). At trial, petitioner’s certified public accountant, Gary Fyffe (Fyffe), testified that on several occasions he requested, on petitioner’s behalf, a meeting with the revenue agent’s group manager to discuss the revenue agent’s proposed adjustments. Fyffe te

r or delay can be attributed to the taxpayer involved, and after the Internal Revenue Service has contacted the tax- payer in writing with respect to such * * * pay- ment . f¹¹ 1Sec. 6404(e) was amended by Taxpayer Bill of Rights 2, Pub. L. 104-168, sec. 301, 110 Stat. 1452, 1457 (1996), to permit the Secretary to abate interest with respect to an "unreasonable" error or delay resulting from "managerial" and ministerial acts. This amendment applies to interest accruing with respect to deficienci

took to contact the taxpayer and request payment.” S. Rept. 99-313 (1985), 1986-3 C.B. (Vol. 3) 1, 208; see also Smith v. Commissioner, T.C. Memo. 2002-1. Moreover, petitioner has failed to demonstrate that the 3 In 1996, sec. 6404(e) was amended by sec. 301 of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1457 (1996), to permit the Secretary to abate interest with respect to “unreasonable” error or delay resulting from “managerial” and ministerial acts. This amendment, however, appl

033, I.R.C. Ps seek to recover litigation costs under sec. 7430, I.R.C. The parties disagree about one of the prerequisites to recovery--whether Ps exhausted their administrative remedies before the Internal Revenue Service. Sec. 7430(b)(1), I.R.C.; sec. 301.7430- 1(b)(2), Proced. & Admin. Regs. Following the examination, Ps’, in the Appeals conference, argued that repair costs exceeded the total insurance recovery so that no portion was attributable to punitive damages. R contends that Ps, in o

the payment of interest, we order abatement only “‘where failure to abate interest would be widely perceived as grossly unfair.’” Lee v. Commissioner, 113 T.C. 5In 1996, sec. 6404(e)(1) was amended by the Taxpayer Bill of Rights 2, Pub. L. 104-168, sec. 301, 110 Stat. 1457 (1996), to allow the Commissioner to abate interest for an “unreasonable” error or delay resulting from “managerial” and ministerial acts. The amendment applies to interest accruing on deficiencies for the tax years beginning

277 (1989), by the Banking Insurance Fund (BIF). Southwest was the leader in residential lending in its Florida markets and, from 1992 to 1995, was awarded the Sarasota Herald-Tribune’s “Reader’s Choice Award” as the best mortgage lender. Southwest's board of directors was composed entirely of persons who served as directors of

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987). The Tax Court has jurisdiction to review whether the Commissioner’s failure to abate interest was an abuse of discretion. Sec. 6404(g)(1); Krugman v. Commissioner, 112 T.C. 230, 239 (1999); Woodral v. Commissioner, 112 T.C. 19, 23 (1999). B. Petitioner’s C

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30162, 30163 (Aug. 13, 1987).3 Even where errors or delays are present, the decision to abate interest remains discretionary. Sec. 6404(e)(1). This Court may order an abatement only where the Commissioner’s failure to abate interest was an abuse of that discretion. Sec. 6404(h)(

Section 301.7502-1(c)(2), Proced. & Admin. Regs., provides: If the document * * * is sent by U.S. certified mail and the sender’s receipt is postmarked by the postal employee to whom the document * * * is presented, the date of the U.S. postmark on the receipt is treated as the postmark date of the document. Accordingly, the risk that the document

volve the exercise of judgment or discretion and occurs during the processing of a taxpayer’s case after all the prerequisites to the act, such as conferences and review by supervisors, have taken place. See Lee v. Commissioner, 113 T.C. 145 (1999); sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. 8Sec. 6404(e) was amended by the Taxpayer Bill of Rights 2, Pub. L. 104-168, sec. 301(a)(1) and (2), 110 Stat. 1452, 1457 (1996), to permit the Commissioner to abate interest with respect to an “unre

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).] While petitioner's original application for abatement encompasses the deficiency and all the interest due for the 1996 taxable year, his subsequent request relates only to interest, and at the hearing, petitioner narrowed the scope of his request for abat

t to sections 301, 302, and 304. Discussion Section 304 mandates that certain transactions involving shares in related corporations be recast for tax purposes as redemptions, the tax treatment of which is then governed by section 302 and potentially section 301. The parties here disagree with respect to whether section 304 is applicable to the December 1, 1996, transaction between Mr. Combrink and COST. - 7 - Petitioners advance two alternative arguments as to why section 304 should not be appli

tax year, concentrating on petitioners’ tax treatment of their partnership interest in Hillcrest Securities. On October 9, 1986, respondent issued a notice of deficiency for 1981. 1 References to sec. 6404(e) are to sec. 6404(e) before amendment by sec. 301 of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1452, 1457 (1996). Unless otherwise stated, all other section references are to the Internal Revenue Code as amended, and all Rule references are to the Tax Court Rules of Practice

cting in his or her official capacity, in performing a ministerial act. See sec. 6404(e)(1).9 An error or delay by the Commissioner can be taken into account only: (1) If it occurs after the Commissioner 9 Sec. 6404(e) was amended in 1996 by TBOR 2 sec. 301, 110 Stat. 1457, to permit the Commissioner to abate interest with respect to an “unreasonable” error or delay resulting from “managerial” or ministerial acts. The amendment applies to interest accruing with respect to deficiencies for taxabl

ocedural or mechanical act that does not involve the exercise of judgment or discretion, and that occurs during the processing of a taxpayer’s case after all prerequisites to the act, such as conferences and review by supervisors, have taken place.” Sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).3 Congress intended for the Commissioner to abate interest “where failure to abate interest would be widely perceived as grossly unfair.” H. Rept. 99-426, at

Section 301.7502-1(c)(2), Proced. & Admin. Regs., provides: If the document is sent by United States certified mail and the sender's receipt is postmarked by the postal employee to whom such document is presented, the date of the United States postmark on such receipt shall be treated as the postmark date of the document. Accordingly, the risk that

301.7122-1T(j), Temporary Proced. & Admin. Regs., 64 Fed. Reg. 39027 (July 21, 1999). - 9 - IRM, sec. 57(10)9.1(1)-(2) (Feb. 26, 1992). An offer is unprocessable if: (1) The taxpayer is not identified; (2) the liabilities to be compromised are not identified; (3) no amount is offered; (4) appropriate signatures are not present; (5) financial

t to sections 301, 302, and 304. Discussion Section 304 mandates that certain transactions involving shares in related corporations be recast for tax purposes as redemptions, the tax treatment of which is then governed by section 302 and potentially section 301. The parties here disagree with respect to whether section 304 is applicable to the December 1, 1996, transaction between Mr. Combrink and COST. Petitioners advance two alternative arguments as to why section 304 should not be applied to

301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 2 Congress amended sec. 6404(e) in 1996 to permit abatement of interest for "unreasonable" error and delay in performing a ministerial or "managerial" act. Taxpayer Bill of Rights 2 (TBOR 2), Pub. L. 104-168, sec. 301(a)(1) and (2), 110 Stat. 1452, 1457 (1996). T

301(a), (b)(1), (c), and (d) and 302(d). See generally Bittker & Eustice, Federal Income Taxation of Corporations and Shareholders, par. 8.23 (1999 Cum. Supp. 1).2 Thus, under this argument, Mr. Read’s dividend is taxable to him in a year that most likely is closed by the section 6501 period of limitations. Under the major- ity’s analysis, therefore, the Government may be faced once again with the very same “whipsaw” that Congress intended to remedy through the enactment of section 1041. Althoug

chapter 301.7 See, e.g., Rev. Proc. 90-60, sec. 1, 1990-2 C.B. at 651 (an employee may use the revenue procedures to compute the “deductible costs of business meal and incidental expenses paid or incurred while traveling away from home”); see also id. sec. 6.01, 1990-2 C.B. at 655 (“the Federal M&IE rate described in section 3.02 for the locality of travel will be applied in the same manner as applied under the Federal Travel Regulations, 41 C.F.R. Part 301-7 (1990), except as provided in sectio

). However, interest on an underpayment of tax is imposed by sec. 6601, which is part of subtitle F. Accordingly, sec. 7491(a) does not apply to the present case. 14 Sec. 6404(e) was amended in 1996 by the Taxpayer Bill of Rights 2, Pub. L. 104-168, sec. 301, 110 Stat. 1452, 1457 (1996), to permit the Commissioner to abate interest with respect to an “unreasonable” error or delay resulting from “managerial” or ministerial acts. The amendment applies to interest accruing with respect to deficienc

1284 (1986); Maxwell v. Commissioner, 87 T.C. 783, 789 (1986); see also sec. 6226(f). Partnership items include each partner's proportionate share of the partnership's aggregate items of income, gain, loss, deduction, or credit. See sec. 6231(a)(3); sec. 301.6231(a)(3)-1(a)(1)(i), Proced. & Admin. Regs. - 6 - Partnership items are distinguished from affected items, which are defined in section 6231(a)(5) as any item to the extent such item is affected by a partnership item. See White v. Commissi

air." H. Rept. 99-426 (1985), 1986-3 C.B. (Vol. 2) 844; S. Rept. 99-313 (1985), 1986-3 C.B. (Vol. 3) 208. However, Congress did not intend that abatement "be used routinely to avoid payment of interest." Id. 7 In 1996, sec. 6404(e) was amended under sec. 301 of the Taxpayer Bill of Rights 2, Pub. L. 104-168, 110 Stat. 1452, 1457 (1996), to permit the Secretary to abate interest with respect to an unreasonable error or delay resulting from managerial and ministerial acts. This amendment, however,

nt to the departing shareholder ex-spouse as a distribution in redemption of the purchased stock to the remaining shareholder ex-spouse will cause the constructive distribution to be treated as a dividend to the remaining shareholder ex-spouse under sec. 301 rather than as a substantially disproportionate redemption under sec. 302(b)(2) qualifying as a distribution in payment in exchange for the stock under sec. 302(a), with resulting capital gain treatment. This is because the proportionate int

l or mechanical act that does not involve the exercise of judgment or discretion, and that occurs during the processing of a taxpayer’s case after all prerequisites to the act, such as conferences and review by supervisors, have taken place.* * * [Sec. 301.6404-2T(b)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).] Section 6404(e) is not intended to be “used routinely to avoid payment of interest”, but rather is to be “utilized in instances where failure to abate intere

301-7.2(a)(2) (1994 & 1996). Nor do we agree with respondent that a taxpayer is precluded from deducting travel expenses under section 162(a)(2) if he or she does not pay for lodging or meal costs for his or her travel. The mere fact that a taxpayer is furnished with meals and lodging without charge while employed away from home does not neces

tee at its fair market value.” Sec. 311(b) only applies to a corporate distribution of appreciated property to which subpt. A (secs. 301-307) applies. Sec. 355(a)(1), if applicable to this case, would provide an exception to dividend treatment under sec. 301 and, therefore, an exception to the application of sec. 311(b). See sec. 355(c)(3). We note, in passing, that, because Ridge’s S corporation election was made on, not after, Dec. 31, 1986, sec. 1374, as amended by the Tax Reform Act of 1986

Callaway's request for prompt assessment filed on behalf of decedent's estate on December 23, 1991, was valid, thereby resulting in the immediate conversion of decedent's Mountain View partnership items to nonpartnership items under section 6231(c)(2) and section 301.6231(c)-8T, Temporary Proced.

er, 110 T.C. 114 (1998). - 2 - 1. Held: The characterization of COD income is a subchapter S item to which the FSAA relates, and is therefore properly determined by this Court in an S corporation proceeding. Secs. 6226(f), 6241, 6244, 6245, I.R.C.; sec. 301.6245-1T(a)(1)(iv) and (b), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 3003- 3004 (Jan. 30, 1987). Accordingly, this Court has jurisdiction to hear this case. Clovis I v. Commissioner, 88 T.C. 980, 982 (1987), applied. 2. Held, further, ex

Under the particular facts of that case, we concluded that the Commissioner had erred in treating the increased taxes reported in the amended returns as amounts "shown upon his return" within the meaning of section 301.6211-1(a), Proced.

ndesirability of the case, the work and ability of counsel, the results obtained, and the customary fees and awards in other cases, should not be considered for the purpose of determining whether an increased award is warranted. Id. at 573; see also sec. 301.7430- 4(b)(3)(iii)(B), Proced. & Admin. Regs. The Court of Appeals for the Fifth Circuit, citing Pierce v. Underwood, supra, has explained in similar fashion that the term "special factor" refers to attorneys who possess nonlegal or technica

The issue to be decided is whether an S corporation, whose sole shareholders are two grantor trusts, constitutes a "small S corporation" within the meaning of section 301.6241-1T(c)(2), - 2 - Temporary Proced.

te of the United States postmark stamped on the envelope if the requirements of section 7502 are satisfied. Section 7502 does not apply unless a petition is timely deposited in the United States mail with sufficient postage prepaid. Sec. 7502(a)(2); sec. 301.7502-1(c)(1)(ii), Proced. & Admin. Regs. When a private postage meter is used, the postmark -4- date must be within the prescribed period for filing, and the document must be received by the addressee within the normal delivery period for an

y is not a partnership for such year, then, to the extent provided in regulations, the provisions of this subchapter are hereby extended in respect of such year to such entity and its items and to persons holding an interest in such entity. See also sec. 301.6233-1T (a), (c)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6779, 6795 (Mar. 5, 1987). Willner does not deny that Hardin's activities were fraudulent. He does not deny that we have jurisdiction with respect to the partnership that is

, time period. Further, the provisions of section 7502 contemplate that the envelope be deposited in the mail in the United States, meaning that the envelope is deposited with the domestic mail service of the U.S. Postal Service. Sec. 7502(a)(2)(B); sec. 301.7502-1(c)(1)(ii), Proced. and Admin. Regs. Finally, and perhaps most importantly, section 7502 does not apply to any document that is deposited with the mail service of any other country. Sec. 301.7502- 1(c)(1)(ii), Proced. and Admin. Regs.3

223(c) requires that, for purposes of mailing an NBAP and FPAA, respondent use the information on the partnership return or use specific information contained in a notice submitted in writing to the IRS in accordance with regulations. Sec. 6223(c); sec. 301.6223(c)-1T, Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6779, 6784 (Mar. 5, 1987). Petitioner testified that she did not submit the required notice under the regulations that would have instructed the IRS to change a name or a zip code. Th

Petitioner never provided any information to the Commissioner pursuant to section 6223(c) or section 301.6223(c)-1T(b), Temporary Proced.

301.7430-1(a) and (b)(1), Proced. & Admin. Regs.; see Rogers v. Commissioner, T.C. Memo. 1987-374 (noting that before the issuance of a notice of deficiency, the Internal Revenue Service is seeking facts to decide whether it should determine a tax deficiency and thereby force a taxpayer to incur litigation costs or pay the determined tax; noti

301.6320-1(f)(2), Q&A-F5, Proced. & Admin. Regs.; see Miller v. Commissioner, 115 T.C. 582, 589 n.2 (2000), affd. 21 Fed. Appx. 160 (4th Cir. 2001); see also sec. 301.6330-1(f)(2), Q&A- F5, Proced. & Admin. Regs.; Magana v. Commissioner, 118 T.C. 488, 493-494 (2002). We are unable to identify any special circumstances in the instant proceeding

301.6501(e)-1(a)(1)(ii), Proced. & Admin. Regs. Thus, we do not consider petitioner’s costs of goods sold in deciding whether he omitted 25 percent of his gross income for a year. Petitioner and Ms. Shaw reported gross receipts of $26,810 on Schedule C of their 1993 return. We need not decide whether to calculate the 25 percent omission based

sec. 6330(d) were not raised by him in his request for a hearing or at the hearing. Since all such issues lack merit, we need not decide whether petitioner is entitled to raise them in the instant proceedings. - 12 - amount of the assessment.6 See sec. 301.6203-1, Proced. & Admin. Regs. The MFTRA-X transcripts further indicate that the examination assessments were made on September 11, 1989, with respect to 1984, 1985, and 1986, and June 11, 1990, as to 1987. Petitioner next contends that even

ency is mailed, and, if a proceeding with respect to the deficiency is brought before this Court, the period of limitations remains suspended until the decision of this Court becomes final and for 60 days thereafter. See secs. 6213(a), 6503(a)(1); sec. 301.6503(a)-1, Proced. & Admin. Regs. Thus, the time for assessment of tax for 1994 and 1995 remains open until 60 days after our decision in this case becomes final. To reflect the foregoing, Decision will be entered for respondent.

In this regard, section 301.7430-5(d), Proced.

301.7502-1(c)(1)(iii)(b), Proced. & Admin. Regs.] The regulations thus provide two tests under which privately metered mail bearing a timely postmark received after the 90-day statutory filing period will be deemed timely filed under section 7502(a). The first test requires that the petition be received not later than the time that mail postma

on 7502 applies, a document that is timely mailed is treated as timely filed. In order for section 7502 to apply, the document must be mailed in accordance with certain requirements set forth in the statute and regulations. See sec. 7502(a)(2), (b); sec. 301.7502-1(c), Proced. & Admin. Regs. For example, the document must be contained in a properly addressed envelope, with sufficient - 7 - postage prepaid. See sec. 301.7502-1(c)(1), Proced. & Admin. Regs. There are additional rules regarding the

tco, and taxable years 1985 through 1988, with respect to Makalu; i.e., whether "each partner's share of each partnership item is the same as his share of every other item." The same share requirement of section 6231(a)(1)(B)(i)(II) is satisfied if during all periods within a taxable year, each partner's share of each partnership item specified in section 301.6231(a)(3)-1(a)(1), Proced.

tco, and taxable years 1985 through 1988, with respect to Makalu; i.e., whether "each partner's share of each partnership item is the same as his share of every other item." The same share requirement of section 6231(a)(1)(B)(i)(II) is satisfied if during all periods within a taxable year, each partner's share of each partnership item specified in section 301.6231(a)(3)-1(a)(1), Proced.

immediately assess the deficiency when he believes that the assessment or collection of a deficiency will be jeopardized by delay. “A jeopardy assessment may be made before or after the mailing of the notice of deficiency provided by section 6212.” Sec. 301.6861-1(a), Proced. & Admin. Regs. The Commissioner may make a jeopardy assessment or collection when the taxpayer is or appears to be: (1) Planning to depart from the United States, or conceal himself or herself; (2) planning to place his pr

the taxpayer, that is signed by an individual in the Office of Appeals who has been delegated the authority to settle the dispute on behalf of the Commissioner, and states or indicates that the notice is the final determination of the entire case.” Sec. 301.7430-3(c)(2), Proced. & Admin. Regs. (the regulation also treats a notice of claim disallowance issued by the Office of Appeals as a notice of decision, but this relates to claims for refund, which is not our situation). A 30-day letter does

It does not appear based on upon [sic] the provisions, conditions and examples provided in the Internal Revenue Regulations section 301.7122-1(c)(3) and in the Internal Revenue Manual section 5.8.22.2(4), that you qualify for an Effective Tax Administration Offer in Compromise due to economic hardship.

he taxpayer, that is signed by an individual in the Office of Appeals who. has been delegated the authority to settle the dispute on behalf of the Commissioner, and states or indicates that the notice is the final determination of the entire case." Sec. 301.7430-3(c) (2),. Proced. & Admin. Regs. (the regulation also treats a notice of claim disallowance issued by the Office of Appeals as a notice of decision, but this relates to claims for refund, which is not our situation). A 30-day letter doe

the taxpayer, that is signed by an individual in the Office of Appeals who has been delegated the authority to settle the dispute on behalf of the Commissioner, and states or indicates that the notice is the final determination of the entire case.” Sec. 301.7430-3(c)(2), Proced. & Admin. Regs. (the regulation also treats a notice of claim disallowance issued by the Office of Appeals as a notice of decision, but this relates to claims for refund, which is not our situation). A 30-day letter does

301.6231(c)-7(a), Temporary Proced. & Admin. Regs., 66 Fed. Reg. 50561 (Dec. 4, 2001). Imperial is not a party to these proceedings. 7 In the notice of final partnership administrative adjustment issued to Corona for its 1998 taxable year, respondent determined, as the lone adjustment in that FPAA, an $80 million increase in Corona’s reported

the taxpayer, that is signed by an individual in the Office of Appeals who has been delegated the authority to settle the dispute on behalf of the Commissioner, and states or indicates that the notice is the final determination of the entire case.” Sec. 301.7430-3(c)(2), Proced. & Admin. Regs. (the regulation also treats a notice of claim disallowance issued by the Office of Appeals as a notice of decision, but this relates to claims for refund, which is not our situation). A 30-day letter does

Section 301.6231(a)(3)-1, Proced. & Admin. Regs., identifies those items that are partnership items because they are more appropriately determined at the partnership level. Some items that are required to be taken into account by the partnership under subtitle A are not partnership items because the items are more appropriately considered at the pa

uglin v. Commissioner, T.C. Memo. 2002-51; see also Weishan v. Commissioner, T.C. Memo. 2002-88. Nor does it mandate that the Appeals officer actually give a taxpayer a copy of the verification upon which the Appeals officer relied. Sec. 6330(c)(1); sec. 301.6330-1(e)(1), Proced. & Admin. Regs.; see also Nestor v. Commissioner, 118 T.C. 162 (2002). Given the additional fact that petitioners were actually given copies of the relevant Forms 4340, which are a valid verification that the requirement

x assessments are formally recorded on a record of assessment. Sec. 6203. The summary record must “provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. The Form 4340 received by petitioners at the Appeals Office hearing contained all this information. Petitioners have not demonstrated in this proceeding any irregularity in the assessment procedure that would r

Section 301.6231(a) (3)-1, Proced. & Admin. Regs., identifies those items that are partnership items because they are more appropriately determined at the partnership level. Some items that are required to be taken into account by the partnership under subtitle A are not partnership items because the items are more appropriately considered at the p

x assessments are formally recorded on a record of assessment. Sec. 6203. The summary record must “provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. The transcript of account received by petitioners before the Appeals Office hearing contained all this -8- information. Petitioners have not demonstrated in this proceeding any irregularity in the assessment pr

Section 301.6231(a)(3)-1, Proced. & Admin. Regs., identifies those items that are partnership items because they are more appropriately determined at the partnership level. Some items that are required to be taken into account by the partnership under subtitle A are not partnership items because the items are more appropriately considered at the pa

One example of a contrary provision is section 301, where Congress has provided that funds (or any other property) distributed by a corporation to a shareholder over which the shareholder has dominion and control are to be taxed under the provisions of section 301(c).

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

he same manner to other or later years of the same continuing item in petitioners' case; it does not extend the result to other cases not a part of the agreement. See Conway v. Commissioner, T.C. Memo. 1994-413 (interpreting a similar stipulation); sec. 301.7121-1(b)(3) and (4), Proced. & Admin. Regs. The piggyback agreement is exclusively for docket No. 1173-88; no other case is explicitly or implicitly referenced or incorporated therein. Petitioners' motion is not supported by the piggyback ag

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

Section 301.6231(a)(3)-1(a), Proced. & Admin. Regs., provides as follows: - 23 - the following items which are required to be taken into account for the taxable year of a partnership under subtitle A of the Code are more appropriately determined at the partnership level than at the partner level and, therefore, are partnership items: (1) The partn

vant issue relating to the unpaid tax or the proposed levy, including a spousal defense, appropriateness ofthe collection - 7 - [*7] action, and/or collection alternatives such as an offer-in-compromise or an installment agreement. Sec. 6330(c)(2); sec. 301.6330-1(e)(1), Proced. & Admin. Regs. Following the hearing, the Appeals officer must determine among other things whether the proposed collection action should proceed. In making the determination the Appeals officer shall take into considera

301.7701-3(a) and (b)(1)(i), Proced. & Admin. Regs. Because no election was made, Enterprises’ default classification was partnership. -6- [*6] Enterprises paid FAB management fees and deducted those fees each year. This created nonpassive losses which flowed through the partnership and were reported on the Berrittos’ individual returns. FAB

301.7701-3(a) and (b)(1)(i), Proced. & Admin. Regs. Because no election was made, Enterprises’ default classification was partnership. -6- [*6] Enterprises paid FAB management fees and deducted those fees each year. This created nonpassive losses which flowed through the partnership and were reported on the Berrittos’ individual returns. FAB

ider their offer. Neither part of the IRS considered the offer on its merits. A. Section 7122 The Code permits a taxpayer to make an OIC, and section 7122(a) gives the Commissioner very wide discretion to compromise tax liabilities. Sec. 7122(c)(1); sec. 301.7122-1(c)(1), Proced. & Admin. Regs. In an effort to “treat[] all 10 Driving home this point is IRS Appeals’s recent name change to “Independent Office of Appeals.” See Taxpayer First Act, Pub. L. No. 116-25, sec. 1001(a), 133 Stat. at 983 (

301.6651- 1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, - 22 - [*22] intentional failure, or reckless indifference. United States v. Boyle, 469 U.S. 241, 245 (1985). Padda and Kane's 2012 return was due on October 15, 2013. The parties have stipulated that the return was filed on October 25, 2013. Padda and Kane seek to a

- 98 - [*98] distribution must withhold taxes when it distributes property to a foreign person in a nondividend section 301 distribution.¹°6 Subject to exceptions not applicable here,¹°7 section 1445(e)(3) requires payors to withhold "10 percent of the amount realized by the foreign shareholder." The Commissioner argues that Beekman should be required to withhold under section 1442 on the dividends out ofearnings and profits and under section 1445 on the dis

- 98 - [*98] distribution must withhold taxes when it distributes property to a foreign person in a nondividend section 301 distribution.¹°6 Subject to exceptions not applicable here,¹°7 section 1445(e)(3) requires payors to withhold "10 percent of the amount realized by the foreign shareholder." The Commissioner argues that Beekman should be required to withhold under section 1442 on the dividends out ofearnings and profits and under section 1445 on the dis

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

- 21 - [*21] 60, 64 (1980). However, ifthe transfer is a loan or ifthe benefit to the shareholder is indirect or derivative, there is no constructive distribution. Id. at 64. In considering whether a transfer is a loan, the Court looks to "whether there was a genuine intention to create a debt, which, in turn, depends upon weighing such

us By reserving the broad rights and powers set forth in Section 1.04 of this Article, I intend to qualify my trust as a "Grantor Trust" under Sections 671 to 677 ofthe Internal Revenue Code so that, for federal income tax purposes, I will be treated as the owner during my lifetime ofall the assets held in my trust as though I held them in my individual capacity. During any period that my trust is a Grantor Trust, the taxpayer identification number ofmy trust shall be my social security number,

Indeed, the settlement officer's actions were consistent with section 301.6330-1(d)(2), Q&A-D8, Proced.

- 4 - [*4] entities involved in these consolidated cases (together, LLCs), are New York limited liability companies that, pursuant to section 301.7701-3(b)(1)(i), Proced.

Sec 301.7701-3(b)(1)(ii), (c)(1)(i), Proced. & Admin. Regs. - 20 - [*20] (cid:16)042On October 30, 2001, $41,000 was deposited into 0327's Deutsche Bank account--this was the only capital contribution made to 0327. (cid:16)042 On November 1, 2001, 0327 bought and sold offsetting long and short foreign-currency options on Japanese yen from Deutsche

Sec 301.7701-3(b)(1)(ii), (c)(1)(i), Proced. & Admin. Regs. - 20 - [*20] (cid:16)042On October 30, 2001, $41,000 was deposited into 0327's Deutsche Bank account--this was the only capital contribution made to 0327. (cid:16)042 On November 1, 2001, 0327 bought and sold offsetting long and short foreign-currency options on Japanese yen from Deutsche

ider only arguments and issues the taxpayerraised at the collection hearing or otherwise brought to the attentio ofthe Appeals Office. Giamelli v. Commissioner, 129 T.C. 107, 112-113 (2007); Magana v. Commissioner, 118 T.C. 488, 493 (2002); see also sec. 301.6330- (f)(2), Q&A-F3, Proced. & Admin. Regs. Petitioner argue that respondent's Appeals Office incorrectly sustained respondent's filing of notice ofFederal tax lien because it ignored the fact that petitioner's 2003 Fede al income tax liabi

Goyak, as either a constructive dividend under section 301 or nonqualified deferred compensat ion under section 402 (b) .

ining whether a requesting spouse will suffer economic hardship if the Commissioner denies his or her request for section 6015(f) relief, Rev. Proc. 2003-61, sec. 4.02, directs the Commissioner to base his decision on rules similar to those found in section 301. 6343-1 (b) (4) , Proced. & Admin . Regs . Section 301.6343-1(b) (4), Proced. & Admin. Regs., provides that an economic hardship exists if an individual is unable to pay reasonable basic living expenses. In determining a reasonable amount

301.7701-3(b) (1) (ii), Proced. & Admin. Regs. R's disregard of PC, W, and LLC would result in tax deficiencies against TR for 2002-04. R also seeks to impose a sec. 6662(a), I.R.C., penalty on TR. 1. Held: Because the organization of PC and W accomplished no significant business purpose and because PC and W were, in substance, hollow corporat

Section 301 treats the distribution as either a dividend, a reduction of basis, or a gain from the sale or exchange of property. See sec. 301(a), (c). Section 1.301-1(1), Income Tax Regs., provides that a “distribution to shareholders with respect to their stock is within the terms of section 301 although it takes place at the same time as another

4 .02(1)(c) (citing section 301 .6343-1(b)(4)(i), Proced .

ain sales qualified as redemptions in complete termination of the selling shareholder corporation’s interest in the subsidiaries and must be taxed as distributions in exchange for stock under section 302(a) and (b)(3) rather than as dividends under section 301. The Court of Appeals affirmed our decision in part but remanded the case for our consideration of an argument petitioner advanced for the first time on appeal. Background We adopt the findings of fact in Merrill Lynch & Co. & Subs. v. Com

Section 301.7430-1(b)(1)(i). It is undisputed that, upon receiving the results of the IRS audit, Petitioner’s Counsel had a conference with the Appeals division, Cynthia Ace. Petitioner also contends (a) “a request for legal fees is valid at the administrative level”, (b) respondent refused to settle the case unless petitioner waived litigation cos

claim by implication, we hold that the settlement officer did not abuse her discretion in rejecting petitioner’s offer-in- compromise, inasmuch as petitioner was not entitled to challenge his underlying tax liabilities for 1987, 1990, and 1991, see sec. 301.7122-1(b)(1), Proced. & Admin. Regs.; failed to timely comply with the settlement officer’s requests for complete current financial information to establish doubt as to collectibility or economic hardship, see sec. 301.7122-1(b)(2) and (3),

may levy upon the property of any person . To be entitled to an administrative hearing under section 6330, the person must request the hearing within the 30- day period commencing the day after the date of the pre-levy notice . Sec . 6330(a)(3)(B) ; sec. 301 .6330-1(b)(1), Proced . & Admin . Regs . Once the Appeals officer issues a notice of determination, the taxpayer may seek judicial review in this Court . Secs . 6320(c), 6330(d)(1) . If the validity of the underlying tax - 14 - liability is

Further, section 301 .6223(c)-1T, Temporary Proced .

Respondent determined that petitioners' second request for a section 6330 hearing was untimely and therefore petitioners were entitled only to an equivalent hearing pursuant to section 301 .6330-1(i)(1), Proced .

Section 6334(c) provides: "Notwithstanding any other law of the United States * * *, no property or rights to property shall - 23 - be exempt from levy other than the property specifically made exempt by subsection (a)." Section 301.6334-1(c), Proced.

Section 301.7430-1(b)(1), Proced. & Admin. Regs., provides: .A party has not exhausted the administrative remedies available within the Internal Revenue Servicè with respect to any tax matter for which an Appeals office conference is available under §§ 601.105 and 601.106 of - 11 - this chapter (other than a tax matter described in paragraph (c) o

Whether the Recuestino Spouse Would Suffer Economic Hardship If Relief Were Not Granted The Commissioner considers whether payment of tax would cause economic hardship by applying section 301.6343-1(b)(4)(i) and (ii), Proced.

301.6320-1(i)(1), Proced. & Admin. Regs. Parker offered to discuss the case with him by telephone on June 23, 2004. Petitioner wrote Parker on May 19, 2004, requesting a face- to-face hearing and copies of documents verifying assessment of taxes and penalties. Petitioner told Parker that he intended to bring a court reporter to the hearing and

301.6203-1, Proced. & Admin. Regs. Skidmore reviewed transcripts that appeared to him to show that petitioner's tax for 1998, 2001, and 2002 had been validly assessed. Petitioner has not shown that there was any irregularity in the assessment procedure. We hold that the assessments are valid. - 14 - 3. Whether Respondent Issued a Notice and D

301.6651-1(c)(1), Proced. & Admin. Regs. For illness to constitute reasonable cause for failure to file, petitioner must show that it incapacitated him to such a degree that he could not file his returns. Williams v. Commissioner, 16 T.C. 893, 905-906 (1951); see, e.g., Joseph v. Commissioner, T.C. Memo. 2003-19 (“Illness or incapacity may con

§ 301.6109-1(a)(1)(ii). An IRS individual taxpayer identification number (or “ITIN”) generally is assigned only to a nonresident alien, but in some cases, may be assigned to a resident alien. See Treas. Reg. § 301.6109-1(g)(iii). Both of your children are citizens and residents of the United States, and therefore are ineligible for an ITIN. You app

poses of * * * section [7430(g)]”. Sec. 7430(g)(1)(C). The regulations further establish that “An offer is not a qualified offer unless it is designated in writing at the time it is made that it is a qualified offer for purposes of section 7430(g).” Sec. 301.7430-7T(c)(4), Temporary Income Tax Regs., 68 Fed. Reg. 74852 (Dec. 29, 2003). In addition, the offer must specify the offered amount of the taxpayer’s liability; be made during the qualified offer period (i.e., beginning on the date of the

Under section 301.7502-1(c) (1) (iii) (B) (1), Proced. & Admin. Regs., the timely-mailing/timely-filing rule applies to non-U.S. Postal Service postmarks if the föllowing requirements are satisfied: (i) The postmark so made must bear a legible date on or before the last date, or the last day of the period, prescribed for filing the document or making the

301.7430-7(c)(7), Proced. & Admin. Regs. When the case was subsequently called from the trial calendar, the parties filed a stipulation of settlement in which they agreed, as a basis of settlement * * * that the issue relating to the applicability of self-employment tax on these rental payments is the same as the issue in Johnson v. Commission

301.6301-1, Proced. & Admin. Regs.; Delegation Order No. 198 (Rev. 5), Sept. 7, 2001. “The delegation of authority down the chain of command, from the Secretary to the Commissioner of Internal Revenue, to local IRS employees constitutes a valid 4At trial, petitioner appeared to be willing to discuss compromising his 1997 tax liability. He did

Section 301, however, qualifies the definition of gross income. Barnard v. Commissioner, T.C. Memo. 2001-242. Generally, that section provides that funds distributed by a corporation over which the taxpayer/shareholder has dominion and control are taxed under the auspices of section 301(c). Id. Pursuant to section 301(c), a dividend is taxed as ord

Section 301, however, qualifies the definition of gross income. Barnard v. Commissioner, T.C. Memo. 2001-242. Generally, that section provides that funds distributed by a corporation over which the taxpayer/shareholder has dominion and control are taxed under the auspices of section 301(c). Id. Pursuant to section 301(c), a dividend is taxed as ord

- 7 - request, pursuant to section 301.9100-3, Proced.

Section 301, however, places a restriction on the definition of gross income. Barnard v. Commissioner, T.C. Memo. 2001-242. Generally, that section provides that funds distributed by a corporation over which the shareholder has dominion and control are taxed under the auspices of section 301(c). Id. Pursuant to section 301(c), a constructive divide

Section 301, however, qualifies the definition of gross income. Barnard v. Commissioner, T.C. Memo. 2001-242. Generally, that section provides that funds distributed by a corporation over which the taxpayer/shareholder has dominion and control are taxed under the auspices of section 301(c). Id. Pursuant to section 301(c), a dividend is taxed as ord

On June 7, 1999, respondent granted petitioner a so-called equivalent hearing under section 301.6330-1T(i), Temporary Proced.

mo. 2002-51; see also Weishan v. Commissioner, supra. Second, the Appeals officer is not required to give the taxpayer a copy of the verification that the requirements of any applicable law or administrative procedure have been met. Sec. 6330(c)(1); sec. 301.6330-1(e)(1), Proced. & Admin. Regs.; see also Nestor v. Commissioner, supra. More -13- importantly, in this case, petitioner not only received copies of the MFTRA-X transcripts but also Forms 4340. Even standing alone, the MFTRA-X transcrip

na fide promotional purpose (e.g., as tips for dancers), we must assume that petitioner retained it. Therefore, we hold that the amounts in question totaling $4,577 for 1989 and $1,100 for 1990, constituted distributions to petitioner, taxable under section 301. Respondent concedes that 2618 had no earnings and profits as of November 1990, and he does not challenge as inaccurate the negative retained earnings reflected on 2618's 1989 Schedule L as of both the beginning and end of 1989. Petitione

301.7811-1(c)(2), Proced. & Admin. Regs. Section 7811(b) provides that such Taxpayer Assistance orders may require the Secretary to release property that has been levied upon or to cease or refrain from 3 The Taxpayer Assistance Order was a concept provided for in the Taxpayer Bill of Rights, Technical and Miscellaneous Revenue Act of 1988, Pu

One example of a contrary provision is section 301 where Congress has provided that funds (or any other property) distributed by a corporation to a shareholder with respect to his or her stock are to be taxed under the provisions of section 301(c).

tside the consolidated group and treated as a redemption in complete termination under section 302(a) and (b)(3) as respondent contends, or whether the deemed section 304 redemption qualified as a distribution of property taxable as a dividend under section 301 as petitioner contends; and (2) whether deemed section 304 redemptions in the form of eight 1987 cross-chain stock sales between brother-sister corporations in a consolidated group must be integrated with the later sale of the cross-chain

301.6330-1(d), A-D6, Proced. & Admin. Regs. This regulation also provides that a face-to-face interview is not required at a section 6330 hearing and that a taxpayer does not have the right to subpoena and examine witnesses. Sec. 301.6330-1(d), Proced. & Admin. Regs. Accordingly, we hold that respondent did not abuse his discretion in determin

orded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. See Roberts v. Commissioner, 118 T.C. 365, 371 - 12 - n.10 (2002);

rded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Weishan v. Commissioner, T.C. Memo. 2002-88; Lindsey v. Commissioner

Held: Because P received the deficiency notice and had an opportunity to dispute R’s determination, P is statutorily barred from challenging the existence or amount of his liability in this proceeding. Sec. 6330(c)(2)(B), I.R.C. The fact that R’s Appeals officer considered the merits of the loss at the administrative hearing and the further fact that the notice of determination addressed those merits do not constitute a waiver of the statutory bar. Held, further, sec. 301.6320-1(e)(3), Q&A-E11,

rded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Duffield v. Commissioner, T.C. Memo. 2002-53; Kuglin v. Commissioner

rded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weishan v. C

“A taxpayer is required to provide evidence and justification for claimed expenses, except National Standards”.9 Petitioners presented no evidence at trial or on brief to otherwise substantiate their expenses.10 We hold that the settlement 9See also sec. 301.6330-1(e)(1), Proced. & Admin. Regs.: “Taxpayers will be expected to provide all relevant information requested by Appeals, including financial statements, for its consideration of the facts and issues involved in the hearing.” 10At trial, M

orded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Kaeckell v. Commissioner, T

a record of assessment. Sec. 6203. “The summary record, through supporting - 12 - records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weishan v. C

uglin v. Commissioner, T.C. Memo. 2002-51; see also Weishan v. Commissioner, T.C. Memo. 2002-88. Nor does it mandate that the Appeals officer actually give a taxpayer a copy of the verification upon which the Appeals officer relied. Sec. 6330(c)(1); sec. 301.6330-1(e)(1), Proced. & Admin. Regs.; see also Nestor v. Commissioner, 118 T.C. 162 (2002). Given the additional fact that petitioner was actually given copies of the relevant Forms 4340, which are a valid verification that the requirements

orded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document (e.g., the summary record itself rather than transcripts of account) to satisfy the verification requirement imposed therein

Consistent with section 6323(f)(3), section 301.6323(f)- 1(d)(1), Proced.

ply to different amounts: Sec. 6651(a)(1) applies to amounts required to be shown on a return, whereas sec. 6651(a)(2) applies to the amount actually shown on a return which remains unpaid. See Estate of Rauhoff v. Commissioner, T.C. Memo. 1982-494; sec. 301.6651-1(f), Example (1), Proced. & Admin. Regs. Congress recognized this in enacting sec. 6651(g) and in providing two different standards under subsections (a)(1) and (2) of sec. 6651. 6We have jurisdiction over the sec. 6654(a) additions to

301.6330-1(h)(1)(2), Q&A-H1 and H2, Proced. & Admin. Regs. - 7 - We hold that respondent’s Appeals Office did not abuse its discretion, and respondent may proceed with the proposed collection by way of levy. Decision will be entered for respondent.

rded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. - 10 - Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weish

orded on a summary record of assessment. Sec. 6203. The summary record of assessment must “provide identification of the taxpayer, the - 9 - character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely upon a particular document (i.e., the summary record itself rather than a transcript of account) to satisfy the verification requirement imposed therei

orded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weishan v.

Rule 121(d). - 13 - assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weishan v. C

rded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weishan v. C

301.6330-1(g)(2) Q&A-G3, Proced. & Admin. Regs. Respondent properly offset petitioner’s 1994 tax liability by crediting refunds from other years in accordance with section 6402. We hold that respondent did not engage in collection activity in violation of section 6015(e)(1)(B). To take account of respondent’s concession, An appropriate order w

orded on a record of assessment. Sec. 6203. “The summary record, through supporting records, shall provide identification of the taxpayer, the character of the liability assessed, the taxable period, if applicable, and the amount of the assessment.” Sec. 301.6203-1, Proced. & Admin. Regs. Section 6330(c)(1) does not require the Commissioner to rely on a particular document to satisfy the verification requirement imposed therein. Roberts v. Commissioner, 118 T.C. 365, 371 n.10 (2002); Weishan v.

see also Weishan v. Commissioner, T.C. Memo. 2002-88. Second, the Appeals officer is not required to give the taxpayer a copy of the verification that the requirements of any applicable law or administrative procedure have been met. Sec. 6330(c)(1); sec. 301.6330-1(e)(1), Proced. & Admin. Regs.; see also Nestor v. Commissioner, 118 T.C. 162 (2002). More importantly, in this case, petitioner not only -8- received copies of the MFTRA-X transcript but also Forms 43403 and TXMODA transcripts. Even s

Section 1.301-1(j), Income Tax Regs., states that “If property is transferred by a corporation to a shareholder which is not a corporation for an amount less than its fair market value in a sale or exchange, such shareholder shall be treated as having received a distribution to which section 301 applies.” Because CFC sold the 1994 and 1995 notes to Mr.

Section 1.301-1(j), Income Tax Regs., states that “If property is transferred by a corporation to a shareholder which is not a corporation for an amount less than its fair market value in a sale or exchange, such shareholder shall be treated as having received a distribution to which section 301 applies.” Because CFC sold the 1994 and 1995 notes to Mr.

It was the position of the Service that the substance of the transaction was a redemption of the stock from the taxpayer, taxable under section 301 of the Code, followed by a gift of the redemption proceeds by the taxpayer to the foundation.

Section 1.301-1(j), Income Tax Regs., states that “If property is transferred by a corporation to a shareholder which is not a corporation for an amount less than its fair market value in a sale or exchange, such shareholder shall be treated as having received a distribution to which section 301 applies.” Because CFC sold the 1994 and 1995 notes to Mr.

301.9100-7T(a)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 3624 (Feb.5, 1987). The election must be made by the later of the due date of the tax return for the first taxable year for which the election is to be effective or April 15, 1987. Sec. 301.9100-7T(a)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 3626 (Feb. 5, 1987). In add

301.7502- 1(c)(1)(iii)(a), Proced. & Admin. Regs. However, where the postmark in question is made by a private postage meter, as in this case, section 301.7502-1(c)(1)(iii)(b), Proced. & Admin. Regs., provides the following: If the postmark on the envelope or wrapper is made other than by the United States Post Office, (1) the postmark so made

301.9100-7T(a)(1), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 3624 (Feb.5, 1987). The election must be made by the later of the due date of the tax return for the first taxable year for which the election is to be effective or April 15, 1987. Sec. 301.9100-7T(a)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 3626 (Feb. 5, 1987). In add

Respondent determined that the other income was either constructive dividend income under section 301 or nonqualified deferred compensation under section 402(b).

Section 301.7430-1(b)(1), Proced. & Admin. Regs., provides that, where a conference with Appeals is available, administrative remedies are exhausted only when the taxpayer (1) participated in a conference with Appeals before petitioning this Court, or (2) requested such a conference (as applicable herein, by filing a written protest with respondent

301.6404-2T(b)(1), Temporary 8(...continued) not apply to the instant case. See TBOR 2 sec. 301(c), 110 Stat. 1457. - 15 - Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).9 A decision concerning the proper application of Federal tax law is not a ministerial act. See id. We proceed to consider whether respondent's refusal to abate i

301.6404-2T(b)(1), Temporary 8(...continued) not apply to the instant case. See TBOR 2 sec. 301(c), 110 Stat. 1457. - 15 - Proced. & Admin. Regs., 52 Fed. Reg. 30163 (Aug. 13, 1987).9 A decision concerning the proper application of Federal tax law is not a ministerial act. See id. We proceed to consider whether respondent's refusal to abate i

Section 301.7430-1(b)(1), Proced. & Admin. Regs., provides that, where a conference with Appeals is available, administrative remedies are exhausted only when the taxpayer (1) participated in a conference with Appeals before petitioning this Court, or (2) requested such a conference (as applicable herein, by filing a written protest with respondent

ar year if at any time during the year that individual: (1) Is a lawful U.S. permanent resident (the green card test); (2) meets the substantial presence test; or (3) makes an election to be treated as a lawful U.S. resident. See sec. 7701(b)(1)(A); sec. 301.7701(b)-1(b), Proced. & Admin. Regs. There is no evidence in the record that petitioner was a lawful U.S. permanent resident or that he made an election to be treated as a resident pursuant to section 301.7701(b)-4(c)(3)(v), Proced. & Admin.

651(a)(1) Sec. 6654 1992 $14,966 $1,816.25 -0- 1993 17,412 2,399.75 $365.81 1994 17,336 2,569.75 492.70 1995 15,202 1,466.25 1261.76 1The deficiency amounts listed above do not reflect Federal income tax withheld from petitioner's wages. See, e.g., sec. 301.6215-1, Proced. & Admin. Regs., which provides that "the entire amount redetermined as the deficiency by the decision of the Tax Court which has become final shall be assessed," while only "the unpaid portion of the amount so assessed shall b

Shareholder Basis Section 301.6245-1T, Temporary Proced.

Where dividends from a corporation are payable, at the election of a stockholder, in stock or property, the distribution of such dividends will be treated as a distribution of property to which section 301 applies.

Locke and his partnership items pursuant to section 6231(b) and (c)1 and section 301.6231(c)-7T(a), Temporary Proced.

Accordingly, we find that GRC's expenditures in constructing the Ashland Building were section 301 distributions to petitioners.

Section 1.301-1(j), Income Tax Regs., provides that when an individual shareholder purchases property from a corporation for an amount less than the property's FMV, the shareholder may be deemed to have received a distribution to which section 301 applies, i.e., a dividend, to the extent the FMV exceeds the amount paid by the shareholder for the property.

Section 1.301-1(j), Income Tax Regs., provides that when an individual shareholder purchases property from a corporation for an amount less than the property's FMV, the shareholder may be deemed to have received a distribution to which section 301 applies, i.e., a dividend, to the extent the FMV exceeds the amount paid by the shareholder for the property.

- 3 - estimated tax payment for the succeeding taxable year pursuant to section 301.6402-3(a)(5), Proced.

- 3 - estimated tax payment for the succeeding taxable year pursuant to section 301.6402-3(a)(5), Proced.

- 3 - estimated tax payment for the succeeding taxable year pursuant to section 301.6402-3(a)(5), Proced.

hold that respondent's position in the court proceeding was not unreasonable through September 1996, but that respondent acted unreasonably thereafter by not 18 See supra note 4. Further, we note that respondent neither cites nor relies upon either sec. 301.7430-3(a)(4), Proced. & Admin. Regs., or sec. 301.7430-3(b), Proced. & Admin. Regs. Accordingly, no consideration is given to the possible effect of those provisions of the regulation. Cf. Lavallee v. Commissioner, T.C. Memo. 1997-183 at n.1

Burke did not exhaust her administrative remedies because she failed to request such a conference as required by section 301.7430-1(b)(1), Proced.

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, intentional failure, or reckless indifference. United States v. Boyle, supra at 245. - 23 - Following our review of the record, we are unpersuaded that either MIC or Beverly exercised ordinary business care and prudence in an attempt to file its tax returns timely. We

It is well established that a payment made to a shareholder's family member can constitute a section 301 distribution by a corporation with respect to the stock of the shareholder.

27-30 for a discussion of petitioner's basis in GAPS and JJM by virtue of these contributions.) (c) Tax Treatment of Corporate Distributions Section 301 provides a three-tiered sequence for determining the tax treatment of corporate distributions.

It is well established that a payment made to a shareholder's family member can constitute a section 301 distribution by a corporation with respect to the stock of the shareholder.

Where, as here, the postmark in question is made by a private postage meter, the provisions implementing the "timely mailing/timely filing" rule are contained in section 301.7502- 1(c)(1)(iii)(b), Proced.

301; Falsetti v. Commissioner, supra; Henry Schwartz Corp. v. Commissioner, supra. However, as stated above, we do not treat funds deposited to Americana's account as income taxable to petitioners. We sustain respondent's calculation of petitioners' unreported income for 1987, 1988, and 1989, except for the inclusion of the Americana funds in

Section 301 provides that the amount of a distribution of property by a corporation with respect to its stock to a noncorporate distributee is the amount of money received, plus the “fair market value” of the other property received. Sec. 301(b)(1)(A). Under section 302, a redemption transaction is either treated as an exchange whereby section 1001

§ 301.7623-2(a)(2) (an administrative action is “all or a portion of an Internal Revenue Proceeding”).[7] 7 When, in April 2013, Mr. Gardner signed the Determination, rules interpreting section 7623 were provided by Treasury Regulation § 301.7623-1(a) (2012). On August 12, 2014, the Secretary removed that regulation and promulgated Treasury Regulat

§ 301.6330-1(f)(2), Q&A-F3; see Giamelli, 129 T.C. at 112–16. In other words, the taxpayer must explain what he believes his correct tax liabil- ity to be and supply the SO with some evidence to support that position. See Giamelli, 129 T.C. at 112–16; Fleming v. Commissioner, T.C. Memo. 2017-155, 114 T.C.M. (CCH) 180, 182 (citing McRae v. Commissio

Mr. Crawford’s OIC was based on doubt as to 12 [*12] collectibility and his contention that he is “unable to pay these taxes instantly without inflicting undue hardship upon [himself] and other innocent parties.” Mr. Crawford contends that his OIC should have been accepted because he was reinvesting roughly half of his $208,000 20

But see Bilzerian v. United States, 86 F.3d 1067, 1069 (11th Cir. 1996) (per curiam). In contrast, since nonrebate refunds do not fit within the definition of a deficiency provided by section 6211, the Commissioner is limited to a refund suit under section 7405 to recover those refunds. See LaRosa, 163 T.C. at 40–41; YRC Reg’l Transp.

§ 301.6221-1(c) (stating that assessment of any penalty that relates to the adjustment of a partnership item shall be based on partnership-level determinations). Negligence is strongly indicated where a taxpayer fails to make a reasonable attempt to ascertain the correctness of a deduction, credit, or exclusion on a return that would seem “too good

§§ 301.7701-1(a), -2(b)(1). Neither petitioner nor her brother was at any time “the person for whom the services [were] performed,” foreclosing her from petitioning this Court for review under section 7436 of her own liability. See generally § 7436(b)(1). Petitioner is not seeking to challenge any determination on behalf of WGH; she seeks to challen

§ 301.6223-1(b)(3) (requiring a partnership to have a designated individual where the partnership representative is an entity). When the Petition was timely filed, Arden Row’s principal place of business was in Alabama. See § 6234(a). I. Arden Row Transaction Natural Aggregates is owned, directly or indirectly, by Matthew Ornstein and Frank Schuler

The Company’s OIC was based on doubt as to 9 [*9] collectibility and its contention that it did not have sufficient assets and income to cover the full amounts of its unpaid tax liabilities. Doubt as to collectibility exists in a case where the taxpayers’ assets and income are less than the full amount of the liability. Treas. Reg

The term “underlying liability” includes any tax deficiency, additions to tax or penalties, and statutory interest. See Montgomery v. Commissioner, 122 T.C. 1, 7–8 (2004); Katz v. Commissioner, 115 T.C. 329, 338–39 (2000). Petitioner received a statutory notice of deficiency for the civil fraud penalties that the proposed levy a

§ 301.7701-3, after which it no longer was a separate entity for U.S. federal income tax purposes. In December 2009 Facebook US and Facebook Ireland executed a series of intercompany agreements (2009 Agreements), in which Facebook Ireland obligated itself to perform certain functions, and certain market development expenses were allocated to it by

Negligence includes any failure to “make a reasonable attempt to ascer- tain the correctness of a deduction, credit or exclusion on a return which would seem to a reasonable and prudent person to be ‘too good to be true’ under the circumstances.” Treas. Reg. § 1.6662-3(b)(1)(ii); see Neonatol- ogy Assocs., P.A. v. Commissioner, 299

§ 301.6601-1(f)(1); see also Fisher v. United States, 80 F.3d 1576, 1580 (Fed. Cir. 1996); Gingerich v. United States, 78 Fed. Cl. 164, 169 n.4 (2007). Certain conditions extend the ten-year limitations period. As relevant here, if the United States brings an action in court to collect a liability and obtains a judgment, the limitations period for

§ 301.6320-1(e)(3), Q&A-E6. Petitioner requested an installment agreement at the CDP hearing. AO Valdez, using the information from petitioner’s submitted 9 [*9] Form 433–A, offered petitioner two installment agreement alternatives with lower monthly payments than those recommended by the RO. These lower amounts accounted for the fact that petitio

The term “underlying liability” includes any tax deficiency, additions to tax or penalties, and statutory interest. See Montgomery v. Commissioner, 122 T.C. 1, 7–8 (2004); Katz v. Commissioner, 115 T.C. 329, 338–39 (2000). An opportunity to dispute the underlying liability includes a prior opportunity for a conference with Appea

The record establishes that the IRS prepared such a return for petitioner for 2018, and her arguments regarding her failure to pay are the same as her arguments regarding her failure to file, which we have rejected above. Accordingly, we find that petitioner is liable for the addition to tax under section 6651(a)(2).11 C. Failur

Willful neglect is a “conscious, intentional failure or reckless indifference.” Boyle, 469 U.S. at 245. Failure to timely file a return is due to reasonable cause if the taxpayer exercised ordinary business care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside

§§ 301.6320- 1(f)(2), Q&A-F3, 301.6330-1(f)(2), Q&A-F3; see also LG Kendrick, LLC, 146 T.C. at 34; Shanley v. Commissioner, T.C. Memo. 2009-17, 97 T.C.M. (CCH) 1062, 1065–66 (holding that a 14-day deadline to submit financial documents was reasonable given that the taxpayer had three months from his request for a CDP hearing to gather the informatio

Treasury Regulation § 301.6231(a)(7)-1 provides rules for determining which partner is the tax matters partner: Treas.

§ 301.7701-3(b)(1)(ii). As a rule, “if [an] entity is disregarded, its activities are treated in the same manner as a sole proprietorship, branch, or division of the owner.” Id. § 301.7701-2(a). In 1998 OGI entered into an investment banking services agree- ment with Weiss Associates. Under this agreement Weiss Associates committed to “perform inve

. . .”)). This Court is tasked with evaluating Ms. Salvi’s economic position at the time of trial on April 15, 2024.18 See Pullins, 136 T.C. at 446–47. A hypothetical hardship is insufficient to justify relief, and a taxpayer must demonstrate that imposing joint and several liability is 18 Because we must evaluate Ms. Salvi’s e

§ 301.6330-1(e)(3), Q&A-E2. Petitioner received a Notice of Deficiency for 2016 but did not seek review in this Court. He was therefore precluded from contesting his 2016 liability before the Appeals Office or before us. See Goza v. Commissioner, 114 T.C. 176, 182–83 (2000); Giamelli v. Commissioner, 129 T.C. 107, 113–14 (2007). Where, as here, the

Treasury Regulation § 301.6651-1(c)(1) gives some guidance on what constitutes reasonable cause for a taxpayer’s failure to timely file.

But that person apparently did not know that the OIC unit had already requested that an NFTL be filed.3 The statute provides that “[t]he Secretary may withdraw a notice of a lien filed under this section” if he makes certain determinations, including a determination regarding an IA.

This regulation is effective for all penalties assessed on or after December 23, 2024. Id. para. (f). 10 The IRS first communicated to petitioner its intention to assert the penalty on May 15, 2017, when it mailed the 30-day letter with the enclosed examination report. As of that date—and as of the later date when the Notice of

§ 301.6320-1(e)(3), Q&A-E7. By Order served November 28, 2023, as clarified on January 25, 2024, we granted respondent’s Motion and remanded the case to Ap- peals. A supplemental hearing was held in February 2024. In a Sup- plemental Notice of Determination issued on March 27, 2024, Appeals determined that “petitioners’ request to challenge the lia

§ 301.6231(a)(6)-1(a)(3). An individual partner could challenge that penalty through a refund action in district court or the Court of Federal Claims; however, the partner generally could raise only partner-level defenses and could not relitigate determinations of partnership items. § 6230(c)(4). 7 The U.S. Court of Appeals for the Eleventh Circuit

7 “Partnership item[s]” include “any item required to be taken into account for the partnership’s taxable year under any provision of subtitle A to the extent regulations prescribed by the Secretary provide that, for purposes of this subtitle, such item is more appropriately determined at the partnership level than at the partner l

Whether a taxpayer has “reasonable cause” within the meaning of section 6651(a)(1) depends on whether the taxpayer exercised “ordinary business care and prudence” but was nevertheless unable to file the tax return within the prescribed time.

“[I]t is not an abuse of discretion for an [Appeals officer] to decline to 5 [*5] consider a collection alternative where the taxpayer does not put an offer on the table.” Powell v. Commissioner, T.C. Memo. 2023-48, at *5; see also, e.g., Lipka v. Commissioner, T.C. Memo. 2022-116, at *10 (“IRS Appeals did not abuse its discret

These challenges may include challenges to the liability the taxpayer reported on a return. Treas. Reg. § 301.6330- 1(e)(1). The term “underlying liability” includes any tax deficiency, additions to tax or penalties, and statutory interest. See Montgomery v. Commissioner, 122 T.C. 1, 7–8 (2004); Katz v. Commissioner, 115 T.C. 32

ward. The Court previously remanded this case to the IRS Whistle- blower Office (WBO) because, in making its initial determination to deny petitioner’s claim, the WBO had not applied the multiple whistle- blower rule set forth in Treasury Regulation § 301.7623-4(c)(4). The WBO subsequently issued a supplemental determination affirming its previous denial of petitioner’s claim. On remand the WBO determined that two other whistleblowers (WB–1 and WB–2) deserved 100% of the credit for the proceeds

28 [*28] B. Issue Raised The sole issue reviewable for abuse of discretion, raised by petitioner at the section 6320 hearing, and preserved in his Petition concerns whether respondent should have accepted petitioner’s ETA OIC. Section 7122(a) authorizes the Secretary to compromise any civil or criminal case arising under the in

§ 301.6330-1(f)(2), Q&A-F3. Both MDIA and respondent submit that the appropriate standard of review is abuse of discretion, and we agree. For taxable years 2000 through 2011, MDIA received a Notice of Deficiency from the IRS and filed a Petition with this Court contesting that determination. Therefore, MDIA has already challenged the liabilities fo

The regulations also require taxpayers raising such a defense to otherwise comply with the requirements of section 6015 and Revenue Procedure 2013-34, 2013-43 I.R.B. 397. Treas. Reg. § 301.6330-1(e)(2). 11 [*11] The root of Sample’s problem is the third requirement in the list above—knowledge or reason to know about the underst

Willful neglect, by contrast, elicits “a conscious, intentional failure or reckless indifference.” Boyle, 469 U.S. at 245. Petitioner raises a final argument against the additions to tax under sections 6651(a)(1) and (2) and 6654. Yet, if correct, he proves far more: namely that because of the purported failure of the IRS to comply

§ 301.6330-1(f)(2), Q&A-F3. We also decline to review a challenge to the underlying liabilities for taxable years 2009, 2016, and 2017 because 9 [*9] B. Abuse of Discretion In deciding whether SO Blue abused her discretion, we consider whether she (1) properly verified that the requirements of applicable law or administrative procedure have been m

Section 7491(c) provides that the Commissioner has the burden of production with respect to an individual’s liability for any penalty or addition to tax. To meet this burden, the Commissioner must come forward with sufficient evidence indicating that it is appropriate to impose the penalty or addition. Higbee v. Commissioner, 11

Petitioner concedes that he did not file an income tax return for the 2018 tax year. The IRS consequently prepared an SFR for 2018 and the record contains a copy of the SFR and a certification validating the SFR. See § 6020(b); Treas. Reg. § 301.6020-1(b)(2). The SFR shows unreported gross income, which petitioner concedes he re

Petitioner argued that the footnote is incorrect, and that any ambiguity should be resolved in petitioner’s favor.9 Petitioner pointed out that we resolved the ambiguity by “turn[ing] to [Treasury Regulation § 301.6231(a)(6)- 1(a)(3)] for guidance.” Id.

These challenges may include challenges to liabilities the taxpayer reported on a return. Treas. Reg. § 301.6330- 1(e)(1). The term “underlying liability” includes any tax deficiency, additions to tax or penalties, and statutory interest. See Montgomery v. Commissioner, 122 T.C. 1, 7–8 (2004); Katz v. Commissioner, 115 T.C. 329,

§ 301.6212-2(a); King v. Commissioner, 857 F.2d at 680. Respondent contends that the relevant return is the 2019 return. The taxpayer has the burden of proving that the Notice of Deficiency was not sent to the last known address. See Yusko, 89 T.C. at 808. Absent “clear and concise notification” from the taxpayer directing [the Commissioner] to use

Treasury Regulation § 301.6724-1(a)(2) provides that a taxpayer has reasonable cause for failure to file information returns when either (1) there are significant mitigating factors with respect to the failure or (2) the failure arose from events beyond the filer’s control.

Mr. Johnson does not contest that the Craddock address was his last known address at the time of the mailing of the notice of deficiency. 4 [*4] II. Tax Court Proceedings After Mr. Johnson petitioned this Court, the case proceeded to trial with respect the 2018 tax year. In the lead-up to trial, the Commissioner conceded the issu

§ 301.6330-1(c)(2), Q&A-C1(ii)(F). 4 [*4] nonetheless set this motion for hearing at our Birmingham, Alabama, trial session. Mr. Nelson thereafter sent a letter to the Commissioner requesting a continuance of the case in light of his wife’s treatments. We granted this request and gave Mr. Nelson another month to file a response to the Commissioner

§ 301.6330-1(f)(2), Q&A-F3; see Giamelli, 129 T.C. at 112–16. In this case petitioners did not present any evidence regarding their underlying tax liability at their CDP hearing and therefore did not properly challenge their underlying liability. Accordingly, our review is for abuse of discretion. 6 [*6] IV. Abuse of Discretion In deciding whether

§ 301.6159- 1(b)(2). If that is the case, the IRS will request further information. Id. The IRS may reject the proposal if the taxpayer does not provide the additional needed information within a reasonable time after the IRS makes the request. Id. Although petitioners provided sufficient information for AO Valdez to begin consideration of an insta

The Notice was dated February 6, 2023, and it was mailed to petitioner at his address in Hauppauge, New York. That was the address shown on his most recently filed Federal income tax return, i.e., his return for 2021. Petitioner resided in New Jersey on September 27, 2023, when he mailed his Petition to this Court. His Petition inc

be accepted based on effective tax administration when (1) there is no doubt that the tax is legally owed and (2) the full amount can be collected, but (3) requiring payment would either create an economic hardship or would be unfair and inequitable.” Petitioners posit that (1) the foregoing is a summary of the test laid out by Treasury Regulation § 301.7122-1(b)(3)(ii); (2) the IRS failed to address the third element of that test; and (3) that failure constitutes a per se abuse of discretion.

§ 301.6330-1(e)(1); see also Nestor v. Commissioner, 118 T.C. 162, 166 (2002). In the Attachment to the Notice of Determination, SO Paz wrote that she verified the assessment, proper issuance of the notice and demand and the notice of NFTL filing, and a balance due.25 SO Paz wrote that “[t]he NFTL appear[s] to be the most appropriate manner in whic

§ 301.6343-1(b)(4) . . . .”)). At the time of trial Ms. Walsh testified that she received $7,100 per month in spousal support, consisting of $6,400 in alimony and $700 in arrearages. Ms. Walsh also received distributions from her retirement account totaling $48,200 and earned income from renting out her apartment in 2022. Under the 2023 federal pov

§§ 301.7701-2(a), 301.7701-3(b)(1). 7 [*7] Nwafor thus is not entitled to deduct the value of his time under section 174. B. Office, Telephone, and Car Expenses Mr. Nwafor also seeks to deduct for 2019 and 2020 certain office expenses, as well as the purchases of two Samsung phones, and a 2012 Toyota Camry. Section 162 generally allows a taxpayer t

§§ 301.7701-1(a)(4), 301.7701-3(b)(1)(ii). Interests held by EWM1 LLC and GKK LLC are treated as being held directly by Messrs. Mandelblatt and Kapadia, respectively. Petitioner’s members, who are indirect partners of Soroban, see I.R.C. § 6213(a)(10), likewise were EWM1 LLC, GKK LLC, and Scott Friedman. Thus, taking into account both direct and ind

The taxpayer can show that he or she did not act with “willful neglect” if he or she can “prove that the late filing did not result from a ‘conscious, intentional failure or reckless indifference.’” Niedringhaus v. Commissioner, 99 T.C. 202, 221 (1992) (quoting United States v. Boyle, 469 U.S. 241, 245–46 (1985)). The burden of

§ 301.6320-1(f)(2); see also Kazmi v. Commissioner, T.C. Memo. 2022-13, at *9. If a taxpayer does not challenge the tax liability at the hearing, the proper standard of review is for abuse of discretion. See Sego, 114 T.C. at 610. Horizon does not dispute that it received a Notice of Deficiency for its 2018 income tax liability. Additionally, with

10(c)(5)(A). It instead represents an act of administrative discretion that deems timely those filed estate tax returns that would otherwise be unable to make the DSUE election without the grant of a discretionary extension under Treasury Regulation § 301.9100-3. See Rev. Proc. 2017-34, § 2.02, 2017-26 I.R.B. at 1282; cf. Vennes v. Commissioner, T.C. Memo. 2021-93, at *44–45; Giambrone v. Commissioner, T.C. Memo. 2020-145, at *11 (describing another safe harbor as “an exercise of administrative

“Willful neglect” is “conscious, intentional failure or reckless indifference.” United States v. Boyle, 469 U.S. 241, 245 (1985). Whether there was reasonable cause (and not willful neglect) is a question of fact “answered on the basis of the circumstances of the individual case.” Grecian Magnesite Mining, Indus. 8 Mr. Aubuchon ack

§ 301.6330-1(g)(2), Q&A-G3. V. Section 6673 Penalty Section 6673(a)(1) authorizes the Court to require a taxpayer to pay a penalty, not to exceed $25,000, whenever it appears to the Court that the taxpayer instituted or maintained the proceeding primarily for delay or that the taxpayer’s position in the proceeding is frivolous or groundless. We hav

Aubin’s closing agreement covers taxable years ending after the date it became effective, the agreement provides that “it is subject to any change in or modification of the law enacted subsequent to” that date, as required by Treasury Regulation § 301.7121-1(c).

§ 301.7701-3(b)(1)(ii). 11 [*11] the Building.” But because “constructing any addition onto the Building or developing the air rights directly above the Building would materially and adversely affect the Façade,” Corning Place relinquished those rights and Gateway “accept[ed] relinquishment of [such] Develop- ment Rights in gross in perpetuity.” H

Petitioners’ late attempt to withdraw their earlier concession subverts our briefing schedule and takes respondent by surprise by not permitting him to respond to this new argument. We decline to allow the withdrawal of the concession. See Estate of DeMuth v. Commissioner, T.C. Memo. 2022-72, at *8–9 (enforcing concession that opposin

§ 301.6330-1(f)(2), Q&A-F3. 4 [*4] Because the assessment for 2016 was based upon a liability reported as due on a return filed for that year, see I.R.C. § 6201(a)(1), and petitioner had no prior opportunity to dispute it, he was entitled to challenge the existence or amount of that liability during the CDP hearing, see Montgomery, 122 T.C. at 9–1

Pursuant to the check-the-box regulations under Treasury Regulation § 301.7701-3(b)(1), an LLC is classified as a partnership by default unless it elects to be classified as a corporation.

§ 301.6330-1(f)(2), Q&A-F3. “An issue is not properly raised at the administrative hearing if the taxpayer fails to request consideration of that issue or if the taxpayer requests consideration but fails to present any evidence after receiving a reasonable opportunity to do so.” Hartmann v. Commissioner, T.C. Memo. 2024-46, at *9; see also Giamelli

“The equivalent hearing will be held by Appeals and generally will follow Appeals’ procedures for a CDP hearing.” Id. subpara. (1). However, generally neither collection action nor the period of limitations for collection is suspended while an equivalent hearing is pending. Id. subpara. (2), Q&A-I3, I4; cf. H.R. Rep. No. 105-599, a

Also, Vaughn-Leavitt is for tax purposes a partnership. See Treas. Reg. § 301.7701-2(c)(1). During our consideration of these cases, we asked respondent to answer whether petitioners’ tiered business structure terminating in a partnership whose principal member was a trust deprives us of jurisdiction to redetermine deficiencies

“[F]inancial difficulties generally do not constitute reasonable cause for failure to file a return.” Namakian v. Commissioner, T.C. Memo. 2018-200, at *12. To prove reasonable cause for failure to pay, the taxpayer similarly must show that he “exercised ordinary business care and prudence in providing for payment of his tax lia

§ 301.6343-1(b)(4) (providing that reasonable basic living expenses will vary according to the “unique circumstances” of the individual taxpayer but that such circumstances “do not include the maintenance of an affluent or luxurious standard of living”). “The burden of making that showing falls on the spouse requesting relief.” Sleeth v. Commission

§ 301.6330-1(f)(2), Q&A-F3. In a case such as the instant case where the underlying tax liability involves the collection of section 6702(a) penalties, during the CDP administrative proceedings the taxpayer must make a meaningful challenge to the penalty itself—e.g., by plausibly contending that his return “contain[s] [sufficient] information on wh

§ 301.6330-1(f)(2), Q&A-F3. An issue is not properly raised at the administrative hearing if the taxpayer fails to request consideration of that issue or if the taxpayer requests consideration but fails to present any evidence after receiving a reasonable opportunity to do so. Giamelli, 129 T.C. at 115–16; Gentile v. Commissioner, T.C. Memo. 2013-1

Willful neglect is defined as a “conscious, intentional failure or reckless indifference.” Boyle, 469 U.S. at 245. A failure to file a federal income tax return timely is due to reasonable cause if the taxpayer exercised ordinary business care and prudence but nevertheless was unable to file the return within the prescribed time

18 6038(b)(1) penalty is not assessable does not conflict with the reasonable cause text.8 The D.C. Circuit’s reliance on a collection due process hearing as the intended forum for the IRS to make the reasonable cause determination is misplaced. The section 6038(b)(1) penalty was added to the Code in 1982 and the collection due pr

Section 385(a) authorizes the Secretary to prescribe “regulations as may be necessary or appropriate to determine whether an interest in a corporation is to be treated . . . as stock or indebtedness,” i.e., equity versus debt. As stated above, section 385(b) sets forth five factors that may be included in any regulations prescribed by th

§ 301.6231(a)(3)-1(b); see § 6231(a)(3) (defining a partnership item). Thus, the proper beginning and ending dates of a partnership’s taxable year are partnership items to be determined in a partnership proceeding where the FPAA places the start date at issue. Harman Road Prop., LLC v. Commissioner, T.C. Memo. 2023-143, at *7 (holding that the star

§§ 301.6201-1(a), 301.7601-1, 301.7701-9. 16 involves a ‘recording’ of the amount the taxpayer owes the Government.” Id. (quoting I.R.C. § 6203). As the Supreme Court has explained, “[t]he ‘assessment’ is ‘essentially a bookkeeping notation.’” Id. (quoting Laing v. United States, 423 U.S. 161, 170 n.13 (1976)). It “is made when the Secretary or his

Under the default rules of Treasury Regulation § 301.7701-2(a) and (c)(1), noncorporate entities with more than one member (such as limited liability companies) are treated as partnerships for federal tax purposes.

§ 301.7122- 1(b)(2). However, the Commissioner may reject an OIC when the taxpayer’s RCP exceeds his offer. See Johnson v. Commissioner, 136 T.C. 475, 486 (2011), aff’d per curiam, 502 F. App’x 1 (D.C. Cir. 2013). Generally, the Commissioner will reject any offer substantially below the taxpayer’s RCP unless special circumstances justify acceptance

§§ 301.6320-1(d)(2), Q&A-D4, 301.6330-1(d)(2), Q&A-D4. It is undisputed that SO3 had no prior involvement related to the tax liabilities for the years at issue. Further, the parties do not dispute that SO3 was required to refer this matter to International Operations because petitioner’s challenge to his underlying liability involved international r

Here, the Commissioner satisfied his burden of production for the additions to tax by producing the SFR and the IRS account transcript for Mr. Ottuso’s 2014 tax year. See I.R.C. § 7491(c); Higbee 116 T.C. at 446. Mr. Ottuso therefore has the burden of proving that the reasonable cause exception applies. Higbee, 116 T.C. at 447.

§ 301.6330-1(d)(2), Q&A-D8 (“The IRS does not consider offers to compromise from taxpayers who have not filed required returns or have not made certain required deposits of tax . . . .”). The core of petitioner’s argument that respondent abused his discretion is that it appeared that he was noncompliant in filing his 2018 and 2019 tax returns becau

Moreover, a final notice of determination denying innocent spouse relief is treated as a notice of deficiency for these purposes. Id. subpara. (3). Section 7430(c)(4)(A) specifies that an individual taxpayer is the “prevailing party” if she (1) substantially prevailed with respect to either the amount in controversy or the most

§ 301.6330-1(f)(2), Q&A-F3; see Giamelli, 129 T.C. at 112–16. “In other words, the taxpayer must explain what she believes her correct tax liability to be and supply the [appeals officer] with some evidence to support that position.” White v. Commissioner, T.C. Memo. 2024-53, at *5; see also Giamelli, 129 T.C. at 112–16; Fleming v. Commissioner, T.

13 Edward’s total cost for the Gillette FRN was $1,000,483.13, consisting of $1 million in principal, $477.78 of accrued interest, and a processing fee of $5.35. Edward paid $250,000 in cash and assumed $750,483.13 of margin debt to effect the purchase. Edward’s total cost for the UPS FRN was $1,075,465.51, consisting of $1.075 millio

Petitioners filed their 2011 joint income tax return over 9 months late, and they filed their 2012 return over 14 months late. At trial Mr. Alvarado explained the late filings as the result of his being overwhelmed with South Bay business and of his need to await financial information from Topaz. However, this Court has held tha

The requesting spouse must demonstrate that imposing joint and several liability is “‘inequitable in present terms,’ Von Kalinowski v. Commissioner, T.C. Memo. 2001-21, and poses a present economic hardship.” Pullins, 136 T.C. at 446. We have “consistently looked beyond the taxable year at issue to apply subsection (f),” Hall v.

irect membership interest in the Funds, but SBCC was both the Funds’ sole manager and the issuer of their membership interests. 1 A “C corporation” is a corporation that is taxed under subchapter C of chapter 1 of the Internal Revenue Code (Code), §§ 301–385. (Unless otherwise indicated, statutory references are to the Code, Title 26 U.S.C., in effect at all relevant times, and Rule references are to the Tax Court Rules of Practice and Procedure.) 2 A corporation which would otherwise be treated

§ 301.7701-4; see also Textron, Inc. & Sub. Cos. v. Commissioner, 117 T.C. 67, 76 (2001). An arrangement, therefore, will be classified as a trust for federal income tax purposes if it is a bona fide transaction that involves a trustee, a beneficiary, and trust property. See Bibby v. Commissioner, 44 T.C. 638 (1965). 19 [*19] A trust is disregarde

Respondent sought remand because the administrative record did not show that respondent’s SO had verified whether the Baumgardners met the requirements for an OIC based on ETA as outlined in Treasury Regulation § 301.7122-1 and IRM 5.8.11 (Aug.

If an entity is disregarded, its activities are treated in the same manner as those of a sole proprietorship. Treas. Reg. § 301.7701-2(a). Accordingly, Schedule C is used to satisfy the entity’s tax reporting requirements unless an election opting out of the default status was filed. Such an election would allow Mr. Tibin to tre

The Commissioner bears the burden of production with respect to an individual taxpayer’s liability for additions to tax. See § 7491(c); Higbee, 116 T.C. at 446–47. Once the Commissioner has met his burden of production, the taxpayer must come forward with persuasive evidence that the Commissioner’s determination is incorrect or

Treasury Regulation § 301.6651-1(c)(1) gives some guidance on what constitutes reasonable cause for a taxpayer’s failure to timely file and failure to 16 [*16] timely pay.

In support of this statement, the IRS cites Treasury Regulation § 301.6402- 3(a)(5), which provides: A properly executed individual, fiduciary, or corporation original income tax return or an amended return (on 1040X or 1120X if applicable) shall constitute a claim for refund or credit within the meaning of .

§ 301.7701-1(a); see also Kraatz & Craig Surveying Inc. v. Commissioner, 134 T.C. 167, 180 (2010) (“The meaning of the words or the legal status of circumstances for federal tax purposes need not be identical to their meaning or their legal effect under state law.” (quoting Estate of Steffke v. Commissioner, 538 F.2d 730, 732 (7th Cir. 1976), aff’g

Willful neglect is defined as a “conscious, intentional failure or reckless indifference.” United States v. Boyle, 469 U.S. 241, 245 (1985). Reasonable cause for failure to file exists where the taxpayer exercised ordinary care and prudence but was nevertheless unable to file the return by the due date. Id. at 246. Reasonable cause

Temporary Treasury Regulation § 301.9100-12T(d) provides the following directions for making the NOL carryback waiver election: Unless otherwise provided in the return or in a form accompanying a return for the taxable year, the elections described in paragraphs (a) and (c) [including the election under section 172(b)(3)] .

77 [*77] (holding that a taxpayer asserting good faith reliance on profes- sional advice must prove that “the taxpayer provided necessary and ac- curate information to the adviser”). Finally, we conclude that Oconee lacked “reasonable cause” for taking the position that its basis in the Subject Property exceeded zero. Jamie Reynolds

The relevant inquiry is what information the Commissioner had at the time the written notice was mailed and whether, in the light of all the surrounding facts and circumstances, the address used was one the Commissioner reasonably believed the taxpayer wanted the written notice to be sent to. See Abeles v. Commissioner, 91 T.C. 101

“If these require- ments are met, the NFTL is valid notwithstanding any other provision of law regarding the form or content of a notice of lien, including State law.” Miccosukee Tribe of Indians, 110 T.C.M. (CCH) at 448–49. The NFTL that the IRS filed in November 2018 was made on Form 668, iden- tified petitioner as the taxpaye

§ 301.7623- 4(a)(2). That is what happened here. The fact that the WBO determined an award equaling 30% of collected proceeds in one (or more) of petitioner’s related claims is not determinative of the amount of the award petitioner is entitled to in this case. After all, the record shows that the collected proceeds resulted from a combination of t

Treasury Regulation § 301.7623-2(e)(2)(i) considers the amount in dispute as “the greater of the maximum total of tax, penalties, interest, additions to tax, and additional amounts that resulted from the action(s) with which the IRS proceeded based on the information provided, or the maximum total of such amounts that were stated in formal positions taken by the IRS i

To decide the motion, we must determine whether respondent complied with the procedure set forth in Treasury Regulation § 301.6212-2 to update petitioner’s last known address based on the U.S.

§ 5321(a) provides that an FBAR penalty is deemed a tax or that it is required to be assessed or collected “in the same manner as a tax.” See §§ 6665(a)(1), 6671(a).

Respondent must produce evidence of a tax return for Mr. Belcik showing a tax liability. See §§ 7491(c), 6651(a)(2); Wheeler v. 21 [*21] Commissioner, 127 T.C. 200, 210–12 (2006), aff’d, 521 F.3d 1289 (10th Cir. 2008). An SFR prepared by the IRS pursuant to section 6020(b) is treated as a return filed by the taxpayer for purpos

Under TEFRA, partnership-related tax matters are addressed in two stages: a partnership-level proceeding to adjust partnership items and a partner-level adjustment to make resulting affected item adjustments in the tax liability of the individual partner. Under TEFRA, the Court’s jurisdiction in a partnership-level proceeding extends

9 These limited exceptions include “where there ‘is a strong showing of bad faith or improper behavior’ by agency decisionmakers” and “where there is a ‘failure to explain administrative action [so] as to frustrate effective judicial review,’” neither of which applies here. See Murphy v. Commissioner, 469 F.3d at 31 (first quoti

§ 301.6330-1(f)(2), Q&A-F3. The administrative record before us does not indicate whether Ms. Shepard received a notice of deficiency with respect to the tax liabilities or had a prior opportunity to dispute them. However, on Form 12153 and at her supplemental CDP hearing, Ms. Shepard did not contest the underlying tax liabilities and SO White conf

§ 301.7122-1(b)(2), (c)(2). The Commissioner may compromise a tax liability on this basis where the taxpayer’s assets and income are less than the full amount of his liability. Id. Conversely, the Commissioner may reject an OIC when the taxpayer’s RCP exceeds the amount he proposes to pay. See Johnson v. Commissioner, 136 T.C. 475, 486 (2011), aff’

“Whether an organization is an entity separate from its owners for federal tax purposes is a matter of federal tax law and does not depend on whether the organization is recognized as an entity under local law.” Id. In general, an arrangement will be treated as a trust if it can be shown that the purpose of the arrangement is to

§ 301.6109-1(d)(3)(i). The IRS will not issue an ITIN to an individual who has, or is entitled to have, an SSN. Id. subpara. (4)(i). 4 [*4] tax for failure to timely file returns for 2008 and 2009,6 as well as an addition to tax for failure to pay estimated tax due for 2010. During the years following the disallowance of petitioner’s claims for cr

§ 301.7623-3(e)(1) and (2) (describing the administrative record for a whistleblower determination); Treas. Reg. § 301.6330-1(f)(2), Q&A-F4 (describing the administrative record for a collection due process hearing). 6 an internet search of Petitioner’s name.” Pet’r’s Mot. to Strike ¶ 15. Thus, they were not “previously unavailable.” Id. ¶ 16. Ms.

§ 301.6501(c)-1(f)(1). If a gift has been adequately disclosed on the gift tax return, or a statement attached to the return, that was filed for the year the transfer occurred, then the ordinary three-year period for assessment commences upon filing. I.R.C. § 6501(c)(9); Treas. Reg. § 301.6501(c)-1(f)(1) and (2). This is true even if the gift discl

§ 301.6320-1(a)(2), Q&A A-11. 4 [*4] liabilities of $2,741, $16,650, and $42,294 for the taxable years at issue, respectively, totaling $61,685.4 Mr. Gayou filed a Petition disputing the Passport Notice on May 17, 2021. Discussion I. General Principles A. Summary Judgment Standard Summary judgment serves to “expedite litigation and avoid unnecessa

Respondent produced evidence of late filing, which Mr. Swanson did not dispute. Neither did he argue that the failure to timely file his 2014 and 2015 tax returns was due to reasonable cause. Thus, we conclude that respondent met his burden of production with respect to the additions to tax. To reflect the foregoing and responde

301.6501(e)-1(a)(1)(iii) (2011). Colony had interpreted a provision of the Internal Revenue Code of 1939. Home Concrete & Supply, 566 U.S. at 481. According to Home Concrete, the opinion in Colony had held that Congress “had ‘directly spoken to the question at hand’” and therefore “left ‘[no] gap for the agency to fill’.” Id. at 489 (plurality

Reliance on a tax professional can constitute reasonable cause if that professional advises the taxpayer on a substantive tax issue, such as whether a liability exists or a return must be filed. Boyle, 469 U.S. at 250–51. To claim reasonable reliance on professional advice, the 10 Although the Estate submitted as a proposed tria

A taxpayer may also challenge her underlying liability in a CDP hearing, but only if she did not receive a statutory notice of deficiency or if she did not otherwise have a prior opportunity to dispute the underlying liability. § 6330(c)(2)(B). In making its determination, IRS Appeals is required to consider all issues properly rai

§ 301.6320-1(f)(2), Q&A (F)(3). Once Appeals makes a determination following a CDP hearing, the taxpayer may appeal the determination to this Court. §§ 6320(c), 6330(d)(1). Petitioner contends in her Motion to Dismiss for Lack of Jurisdiction that this Court lacks jurisdiction over this case under sections 6320 and 6330 because Appeals abused its d

Petitioners failed to properly raise the issue at the CDP hearing because they presented no evidence regarding their eligibility for an offer-in-compromise, failed to submit an offer-in-compromise, and stated that they were abandoning the argument. See Moriarty v. Commissioner, T.C. Memo. 2017-204, at *9, aff’d, No. 18-1077, 2018 W

§ 301.6231(a)(3)-1(b). Held, further, P’s Motion for Summary Judgment will be denied; R’s Motion for Partial Summary Judgment will be granted. ————— Elizabeth J. Smith, Kathleen S. Gregor, Caitlyn M. Leonard, and Armando Gomez, for petitioner. Emerald G. Smith, Naseem Jehan Khan, Michael E. Washburn, and Jonathan E. Cornwell, for respondent. OPINIO

II. Burden of Proof Ordinarily, the statutory notice of deficiency carries with it a presumption of correctness which places the burden on the taxpayer to show that the Commissioner’s determination is erroneous. Rule 142(a); Helvering v. Taylor, 293 U.S. 507, 515 (1935); Welch v. Helvering, 290 U.S. 111, 115 (1933); United States v

The IRS may accept an OIC for doubt as to liability when there is a genuine dispute about the existence or amount of a taxpayer’s debt. Id. subpara. (1). It may accept an OIC for doubt as to collectibility when a “taxpayer’s assets and income are less than the full amount of [his] liability.” Id. subpara. (2). And it may accept an

§ 301.6231(a)(3)-1(b). Pursuant to section 6227(a), a partner may file with the IRS a request for an administrative adjustment of partnership items for any partnership taxable year subject to certain conditions. If the IRS does not allow any part of an AAR filed by the TMP under section 6227(c), the TMP may file a petition with this Court for an ad

. . .”)). Ms. Freman’s Form 8857, dated August 9, 2018, and received by CCISO on February 21, 2019, states that she had a checking account with $300, total monthly income of $1,160, and total monthly expenses of $1,910. At trial Ms. Freman testified that after she left the marital home she moved into a recreational vehicle. She

g for another person in a fiduciary capacity, such fiduciary shall assume the powers, rights, duties, and privileges of such other person in respect of a tax imposed by this title.” Section 6903(b) provides that such notice “shall be given in accordance with regulations prescribed by the Secretary.” Pursuant to section 6903(b), Treasury Regulation § 301.6903-1(b)(2) provides rules for notices filed on or after April 24, 2002.

§ 301.6320-1(e)(3), Q&A E-9. Nevertheless, “[t]he reasonableness of the appeals officer’s decision to terminate a CDP hearing must be determined in light of the entire context of the proceeding.” Murphy v. Commissioner, 469 F.3d at 32. Because CDP hearings are designed to be a forum for considering the taxpayer’s legitimate disagreement with collec

§ 301.6320-1(e)(3), Q&A-E2. Petitioner’s liabilities stem from the tax he reported in his untimely and timely filed returns, and respondent did not issue petitioner a notice of deficiency. Petitioner did not have a prior opportunity to dispute the liabilities at issue. Therefore, the underlying tax liabilities are at issue and the standard of revie

Generally, a partner’s distributive share of income, gain, loss, deduction, or credit shall be determined by the partnership agreement. § 704(a). However, a partner’s distributive share of partnership loss (including capital loss) is allowed only to the extent of the adjusted basis of the partner’s interest in the partnership at th

§ 6211(b)(1); see also Treas.

Willful neglect is defined as a “conscious, intentional failure or reckless indifference.” United States v. Boyle, 469 U.S. 241, 245 (1985). Reasonable cause for a failure to file exists where the taxpayer exercised ordinary care and prudence but was nevertheless unable to file the return by the due date. Id. at 246. Reasonable cau

5 denying petitioner’s claim for lack of a “related action” within the meaning of Treasury Regulation § 301.7623-2(c)(1).5 The WBO denied the OVDI claim in a letter dated May 25, 2016 (denial letter), explaining that “the IRS took no action based on the information [petitioner] provided with respect to [OVDI] or any of the taxpayers who participated in it,” and that neither OVDI nor the participating taxpayers are “valid related actions to [petitio

8 For federal income tax purposes, we characterize the mezzanine Loans N712A and N712B, which were secured by pledges of equity in the disregarded Montevina entities, as nonrecourse debt encumbering the underlying Livermore 10 [*10] § 301.7701-2(a) (“[I]f the entity is disregarded, its activities are treated in the same manner as a sole proprietorship, branch, or division of the owner.”); see also Pierre v.

§ 301.6651- 1(c)(1). The taxpayer can show that he did not act with “willful neglect” if he can “prove that the late filing did not result from a ‘conscious, intentional failure or reckless indifference.’” Niedringhaus v. Commissioner, 99 T.C. 202, 221 (1992) (quoting United States v. Boyle, 469 U.S. 241, 245–46 (1985)). The burden of showing reaso

However, section 751 requires that “we look through the partnership to the underlying assets and deem such a sale as the sale of separate interests in each asset.” Grecian Magnesite Mining, Indus. & Shipping Co. v. Commissioner, 149 T.C. 63, 79 (2017), aff’d, 926 F.3d 819 (D.C. Cir. 2019). The character of gain or loss under sec

Willful neglect is a “conscious, intentional failure or reckless indifference.” See Boyle, 469 U.S. at 245. Petitioner argues that he had reasonable cause for failing to timely file his tax returns for the years at issue because he did not know with whom to file the returns on account of the Department of the Treasury’s alleged

§ 301.6330-1(a)(3), Q&A-A6; Internal Revenue Manual (IRM) 5.11.7.3.4 (Sept. 23, 2016). Notice CP91 notifies a taxpayer that the IRS intends to levy upon a maximum of 15% of the taxpayer’s Social Security benefits. See IRM 5.11.7.3.4. Notice CP508C notifies a taxpayer that the IRS has certified to the State Department that he is a person owing a “se

§ 301.6320-1(f)(2), Q&A-F3. The Court will not consider Mr. Olson’s underlying tax liabilities since they were not properly raised during the CDP hearing. See Giamelli, 129 T.C. at 112–13; Magana, 118 T.C. at 493. Since the underlying liabilities are not properly at issue, we will accordingly review SO Buddenhagen’s actions for abuse of discretion.

§ 301.7623-2(a)(2) (emphasis added). Similarly, a “judicial action” means “all or a portion of a proceeding against any person in any court that may result in collected proceeds.” Id. subpara. (3). The regulations further state that the IRS proceeds based on a whistleblower’s information when the information provided substantially contributes to an

which relates to an adjustment to a partnership item.” Treasury Regulation § 301.6221-1(c) further provides that “[p]artnership-level determinations include all the legal and factual determinations that underlie the determination of any penalty .

§ 301.6320-1(f)(2), Q&A (F)(3). A taxpayer may challenge the existence or amount of the underlying tax liability only if he or she did not receive a notice of deficiency or otherwise have a previous opportunity to dispute the liability. See §§ 6320(c), 6330(c)(2)(B). II. Standard of Review Section 6330(d)(1) provides this Court with jurisdiction to

The notice of determination was mailed by certified mail in accordance with Treasury Regulation § 301.6330-1(e)(3) Q&A-E8 and sufficient to start the 30-day period for appeal under section 6330(d).

The regulations explain that such notice may be served by mail. Id. para. (c) (“A notice of levy may be served by mailing the notice to the person upon whom the service of a notice of levy is authorized . . . . In such a case the date and time the notice is delivered to the person to be served is [generally] the date and time th

§ 301.7502-1(d)(3)(ii). But the regulations are inapplicable to the filing of a Tax Court petition. The Secretary’s regulations require the use of an authorized electronic return transmitter. Id. subdiv. (i). None is involved in the filing of a Tax Court petition. Mr. Sanders’s Petition would be untimely even if we applied these regulations or the

ar ways to do so are to elect to be taxed under subchapter S of the Code,3 or to organize as a limited liability company (LLC) and choose to be taxed as 1 A “C corporation” is a corporation that is taxed under subchapter C of chapter 1 of the Code, §§ 301–385. (All section references are the Internal Revenue Code in effect for the years in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure, unless we say otherwise.) 2 A cash-basis taxpayer recognizes income in th

The Commissioner produced evidence of late filing, which Mr. Di Giorgio does not dispute. Despite placing the additions to tax at issue, Mr. Di Giorgio does not argue on brief that his late filing was due to reasonable cause and not willful neglect. At trial, he testified that he had a difficult time when his wife died, saying t

A taxpayer can show that he did not act with “willful neglect” if he can “prove that the late filing did not result from a ‘conscious, intentional failure or reckless indifference.’” Niedringhaus v. Commissioner, 99 T.C. 202, 221 (1992) (quoting Boyle, 469 U.S. at 245– 46). 5 A taxpayer may have reasonable cause for failure to

e grounds that, X-Way Delta being a disregarded entity, Schedule E, Part II, reporting was inappropriate for any X-Way Delta loss and Island Mountain’s capital gain should have been reported on Schedule D, Capital Gains and Losses.5 Respondent’s disallowance of the Part II loss exactly offset 4 Thus, we assume that, pursuant to Treasury Regulation § 301.7701-3(b), X-Way Delta is disregarded as an entity separate from its owner.

§§ 301.6201-1(a), 301.7601-1, 301.7701-9. Assessment is “the formal recording of a taxpayer’s tax liability.” Baltic v. Commissioner, 129 T.C. 178, 183 (2007); see § 6203. When a tax (including for this purpose a deemed tax, such as an additional amount, addition to tax, assessable penalty, or interest, as explained below) is assessed, the IRS may t

18 [*18] produced a Form 4340, Certificate of Assessments, Payments, and Other Specified Matters, for each year at issue showing that Dr. Shapiro had paid none (or, for 2014, only $205,000 out of $436,531) of the tax due by the payment due date. Dr. Shapiro therefore has the burden of proving that respondent’s decision to asser

§ 301.6212-1(a); Treas. Order 150-10 (Apr. 22, 1982). Moreover, Treasury Regulation § 301.7701-9(c) authorizes the Commissioner to redelegate these powers to other officers or employees under his supervision and control and to authorize further delegation of these powers by his delegates. The Commissioner has redelegated the authority to issue noti

§ 301.6320-1(f)(2), Q&A (F)(3). A taxpayer may challenge the existence or amount of the underlying tax liability only if he or she did not receive a notice of deficiency or otherwise have a previous opportunity to dispute the liability. See §§ 6320(c), 6330(c)(2)(B). III. Standard of Review Where the validity of a taxpayer’s underlying liability is

§ 301.6330-1(d)(2), Q&A-D6 (noting 8 Petitioners argue that SO2 failed to follow IRM guidelines by not informing them of his conclusion that “there was sufficient equity in [their] assets.” But their Form 433–A showed on its face that there was several million dollars of equity in their assets. Petitioners do not explain how SO2’s silence amounted

§ 301.6159-1(a), (c)(1)(i). In reviewing an Appeals officer’s determinations we do not make an independent evaluation of what would be an acceptable collection alternative. See Thompson, 140 T.C. at 179; Murphy, 125 T.C. at 320. Rather, our review is limited to determining whether he abused his discretion. See Thompson, 140 T.C. at 179. The install

A taxpayer may have reasonable cause for failure to timely file a return where he or she experiences an illness or incapacity that prevents him or her from filing the return. Boyle, 469 U.S. at 248 n.6; Jordan v. Commissioner, T.C. Memo. 2005-266. 3 Petitioner testified to the professional and personal difficulties he experienc

§ 301.6212-2(a) (defining “last known address” as “the address that appears on the taxpayer’s most recently filed and properly processed Federal tax return”). Respondent’s obligation is satisfied “even if the taxpayer does not actually receive the notice.” Cropper v. Commissioner, 826 F.3d 1280, 1285 (10th Cir. 2016) (quoting Guthrie v. Sawyer, 970

An equivalent hearing resembles a CDP hearing but does not result in a determination subject to judicial review. See Craig v. Commissioner, 119 T.C. 252, 258–59 (2002); Treas. Reg. § 301.6330-1(i)(2), Q&A-I6. 4 [*4] On April 12, 2021, SO Daniel received a call from Mr. Rivesman stating that Ms. Lem had moved from League City, T

§§ 301.6320- 1(i)(1), 301.6330-1(i)(1). Although similar to a CDP hearing, an equivalent hearing does not result in a determination subject to judicial review. See Craig v. Commissioner, 119 T.C. 252, 258–59 (2002); Treas. Reg. § 301.6320-1(i)(2), Q&A-I6. 5 [*5] documentation and stated that petitioners did not dispute the appropriateness of the as

§ 301.7122- 1(a); Internal Revenue Manual (IRM) 8.23.1.1.1(1) (Aug. 23, 2021).8 Offers-in-compromise are authorized by section 7122(a), which provides that the Secretary may compromise any civil or criminal case arising under the internal revenue laws. The decision whether to accept or reject an offer-in-compromise is left to the Secretary’s discre

The IRS assessed Mr. Mattson’s 2001 and 2002 tax liabilities on March 24, 2008, and for both tax years it issued him a levy notice on September 18, 2008, and a lien notice on or about September 25, 2008. Both dates were well within the ten-year periods of limitations for collection of his liabilities for both tax years. Mr. Mattson

§ 301.7701-3(b)(1)(ii). On June 28, 2012, DWT acquired roughly 176 acres of land (Prop- erty) in Edgefield County, South Carolina. DWT’s acquisition cost for the Property was $1,234,597. On November 5, 2013, petitioner secured an appraisal valuing the Property at $10,989,000; he thus took the posi- tion that the Property had appreciated in value by

§ 301-11.101 and to I.R.S. Revenue Procedure 2011-47, 2011-42 I.R.B. 520, from $57 to $21.19 18 Ms. Valentine’s bank statements show meal expenses around these dates in Aberdeen, Maryland, which is a short distance from both Baltimore, Maryland, and Newark, Delaware. Ms. Valentine’s bank statements also reflect various expenses for which she does n

§ 301.6651-1(c)(1)); Charlotte’s Office Boutique, 121 T.C. at 109. Willful neglect means a “conscious, intentional failure or reckless indifference.” Charlotte’s Office Boutique, 121 T.C. at 109 (quoting Boyle, 469 U.S. at 245). Petitioner does not contest the substance of the additions to tax or penalties, except insofar as it disagrees with respo

The record confirms that the IRS mailed a valid notice of defi- ciency to petitioners’ last known address, which is the same address they listed on the Petition. They did not dispute receipt of that notice, either during the CDP hearing or in their Petition. They had had a prior op- portunity to challenge their 2014 liability by pe

Petitioner does not dispute that the Watsonville address is his “last known address.” § 6212(b)(1). He received the levy notice at that address, timely requested a CDP hearing, and listed the Watsonville 5 [*5] address as his return address. He showed the Watsonville address on his petition to this Court and in his response to the

8 [*8] The IRS determined that KPMG, as the principal organizer under Temporary Treasury Regulation § 301.6111-1T, failed to register the tax shelters; and because Mr.

The IRS Office of Appeals (Ap- peals) resolved petitioner’s equivalent hearing in July 2007. She did not request a CDP hearing with respect to the levy notices associated with tax year 2005, 2006, or 2010. The time for doing so has long since ex- pired. See § 6330(a)(2), (3)(B). The IRS also filed notices of Federal tax lien (NFTLs

§ 301.6320- 1(e)(1). On the basis of the record now before us, we conclude that SO1 erred when she informed petitioner that he was not entitled to challenge his underlying tax liabilities. Evidently believing that petitioner had participated in a prior IRS audit, SO1 referred him instead to audit re- consideration. But in opposing summary judgment

In addition to specific items of information, Form 8918 also requires several narrative responses. Some responses require brief descriptions; however, Form 8918 also requires a rather substantial narrative, as follows: Describe the reportable transaction for which you provided material aid, assistance or advice, including but not l

Automatic extensions of six months may be available to taxpayers who take certain corrective action during that period (which Mr. Clemons did not). See Treas. Reg. § 301.9100-2(b). If a taxpayer does not meet the requirements for an automatic extension, his request for retroactive relief will be granted if he shows that he “acted reas

§ 301.7122-1(b)(3), (c)(3). The decision to accept or reject an OIC, along with the terms of the compromise, is within the Secretary’s discretion. See § 7122(a). In reviewing the settlement officer’s determination, we do not make an independent evaluation of what would be an acceptable collection alternative. See Thompson v. Commissioner, 140 T.C.

The IRS may compromise a tax liability on this basis where the taxpayer’s assets and income are less than his full amount of liability. Id. Conversely, the IRS may reject an OIC when the taxpayer’s RCP exceeds the amount he proposes to pay. See Johnson, 136 T.C. at 486. Generally, settlement officers will reject any offer substa

§ 301.6320- 1(f)(2), Q&A-F3. A taxpayer may challenge the existence or amount of the underlying tax liability unless he or she received a statutory notice of deficiency or otherwise had an opportunity to do so. § 6330(c)(2)(B). Once the Commissioner issues a notice of determination at the 6 [*6] conclusion of the CDP hearing, the taxpayer may seek

Respondent bears the burden of proving, by competent and per- suasive evidence, the proper mailing of the notice of deficiency. Coleman v. Commissioner, 94 T.C. 82, 90 (1990). Generally, if the IRS establishes that the notice existed and produces a USPS certified mail list showing that the notice was sent to the taxpayer’s last kno

It is “essentially a bookkeeping notation.” Laing v. United States, 423 U.S. 161, 170 n.13 (1976) (“The ‘assessment,’ essentially a bookkeeping notation, is made when the Secretary or his delegate establishes an account against the taxpayer on the tax rolls.”). 9 The IRS collects the trust fund liability only once. Consequently, the I

§§ 301.6320-1(e)(3), Q&A–E2, 301.6330- 1(e)(3), Q&A–E2. This is true whether or not the taxpayer actually raised his underlying liability at the prior hearing. See § 6330(c)(4)(A); Bell v. Commissioner, 126 T.C. 356, 358 (2006); Treas. Reg. §§ 301.6320- 1(e)(1), 301.6330-1(e)(1). The SO explained to petitioner that he was not entitled to a hearing r

§ 301.6320-1(d)(2), Q&A-D8. Petitioner allegedly submitted a one-page summary of his per- sonal finances to the IRS in January 2021. We do not know to whom he sent this, but it cannot have been the SO assigned to his case, because the SO was not assigned to his case until April of that year. In any event, petitioner’s summary is far less detailed t

§ 301.6330-1(i)(2), Q&A-I7, Q&A-I9. On the basis of the record before us, we find Mr. Cosio requested a CDP hearing as to tax year 2015 and, consequently, that is the only tax year before the Court. Where the taxpayer’s underlying tax liability is properly at issue in an administrative hearing, we review the liability determination de novo. Goza v.

Served 12/01/22 2 [*2] Held, further, R did not abuse his discretion in denying Ps’ requested collection alternatives and determining to sustain the proposed levy. ————— Matthew T. Eyet, for petitioners. Jonathan Bartolomei, for respondent. MEMORANDUM OPINION GUSTAFSON, Judge: This is a collection due process (“CDP”) case broug

Section 301.6402-2(b)(1), a claim must set forth in detail each ground upon which a credit or refund is claimed and facts sufficient to appraise [sic] the Commissioner of the exact basis thereof. The statement of the grounds and facts must be verified by a written declaration that is made 8 [*8] under penalties of perjury. A claim which does not c

§ 301.7701-2(c)(2)(i). An individual who owns a disregarded entity reports the entity’s tax items on Schedule C. See 2015 Instructions for Schedule C, at C-1. 3 The cash receipts and disbursements method generally requires that expenditures be deducted for the taxable year in which actually made. Treas. Reg. §§ 1.446-1(c)(1)(i), 1.461-1(a)(1); see

4 [*4] On February 2, 2021, petitioner sought review in this Court of the IRS’s determination not to abate interest, and the case proceeded to trial on January 24, 2022. OPINION I. Interest Abatement Process As relevant to this case, interest on a federal income tax deficiency begins to accrue on the tax return due date and contin

“To establish undue hardship, the taxpayer must show that making the tax payment on time would have required ‘the risk of a substantial financial loss.’” Hardin, 103 T.C.M. (CCH) at 1863 (quoting Merriam v. Commissioner, T.C. Memo. 1995-432, 70 T.C.M. (CCH) 627, 636, supplemented by T.C. Memo. 2005-17, aff’d without published op

§ 301.7122- 1(d)(2); Notice 2006-68, § 1.07, 2006-2 C.B. 105, 106. ————— Steven Ray Mather, for petitioner. Kevin W. Coy and Jeremy J. Eggerth, for respondent. OPINION LAUBER, Judge: In this collection due process (CDP) case, peti- tioner seeks review of a determination by the Internal Revenue Service (IRS or respondent) to reject an offer-in-compr

This Court has held that the illness of a taxpayer may be reasonable cause for late filing if the taxpayer demonstrates that he or she could not file a timely return because of the illness. E.g., Williams v. Commissioner, 16 T.C. 893, 906 (1951); Tabbi v. Commissioner, T.C. Memo. 1995-463; Harris v. Commissioner, T.C. Memo. 1969

§ 301.6330-1(e) and (f); see also Davison v. Commissioner, T.C. Memo. 2019-26, at *12–13, aff’d, 805 F. App’x 259 (5th Cir. 2020). Both before the Commissioner and in his Petition, Mr. Pettennude challenges only his underlying liabilities. III. Underlying Liabilities The first issue is whether Mr. Pettennude may dispute his underlying liabilities.

Although CRC’s partnership agreements refer to Clark PLLC, Newman PLLC, and Town PS as “members” (and each, a “member”), we refer to each of them as “partners” of CRC; and we generally refer to the members of LLCs as “partners”. See § 761(b) (“the term ‘partner’ means a member of a partnership”). 6 Our reference to the “relevant

“[T]he statute of limitations is a defense in bar and not a plea to the jurisdiction of this Court.” Badger Materials, Inc. v. Commissioner, 40 T.C. 1061, 1063 (1963), supplementing 40 T.C. 725 (1963). To establish this defense, a taxpayer must make a prima facie case, which ordinarily requires proof of the date of the return an

Reliance on a tax professional can constitute reasonable cause if that professional advises the taxpayer on a substantive tax issue, such as whether a liability exists or a return must be filed. Boyle, 469 U.S. at 250–51. In contrast, willful neglect means a “conscious, intentional failure or reckless indifference” by the taxpay

§ 301.6103(h)(4)-1(a) (“A whistleblower administrative proceeding . . . is an administrative proceeding pertaining to tax administration within the meaning of section 6103(h)(4).”). And neither party asserts that the 7 Section 6103(h)(4)(D) also authorizes disclosure “to the extent required by order of a court pursuant to section 3500 of title 18,

§ 301.6330-1(f)(2), Q&A-F3. Even if petitioner could challenge his underlying liabilities before this Court, his claims would fail. Petitioner does not dispute that he 8 [*8] worked for Lineation and was responsible for its bank accounts. He testified that he was the responsible managing officer during the relevant tax periods. During trial petiti

§ 301.6330-1(i)(2), Q&A-16. 3 On July 1, 2019, the IRS Office of Appeals was renamed the IRS Independent Office of Appeals. See Taxpayer First Act, Pub. L. No. 116-25, § 1001, 133 Stat. 981, 983 (2019). 3 [*3] that all other requirements of law and administrative procedure had been met. The SO convened a telephone conference during which petitione

§ 301.7623-4(d)(2) (providing that the WBO can reject a claim and then issue an entirely separate determination rejecting, denying, or issuing an award on the same claim based on a separate and subsequent consideration). Petitioner contends that his case presents a situation of multiple final determinations. He relies on a footnote in Lewis I where

§ 301.6330-1(e)(3), Q&A-E9; see Treas. Reg. § 301.6320- 1(e)(3), Q&A-E9. Mr. Kotrides had more than two months—from June 21 until August 29, 2019—to provide any supporting information that he wished the settlement officer to consider. The settlement officer gave Mr. Kotrides four weeks to provide this material before the CDP hearing, followed by tw

It provides that distributions from a C cor- poration are taxable as dividends to the extent of the corporation’s earn- ings and profits (E&P).

Although an entity’s classification under local law is not always recognized, carrying on a business and sharing the profits from it generally creates a separate entity for federal tax purposes. Id. subparas. (2) and (3). “[A]ny entity recognized for federal tax purposes . . . that is not properly classified as a trust . . . or

The whistleblower has 30 days from the date the WBO sends the preliminary award recommendation letter to respond in one of the following ways: (i) If the whistleblower takes no action, then the Whistleblower Office will make an award determination, pursuant to paragraph (c)(6) of this section; (ii) If the whistleblower signs, da

§ 301.6320-1(e)(3), Q&A-E2. A taxpayer has had a prior opportunity to dispute the liability where he “previously received a CDP Notice under section 6330 with respect to the same tax and tax period and did not request a CDP hearing with respect to that earlier CDP Notice.” Treas. Reg. § 301.6320-1(e)(3), Q&A-E7; see also Bell v. Commissioner, 126 T

§ 301.6330-1(f), Q&A-F4. On August 3, 2018, SO Davis sent a letter to the Buntons scheduling a telephone conference for September 5, 2018, as part of their CDP hearing. The letter explained that although the Buntons requested a face-to-face hearing, SO Davis scheduled a telephone conference and that “[w]e can offer you a virtual conference or a cor

The Commissioner’s compliance with section 6751(b) is a partnership-level matter, and the burden to raise it falls on the participating partners, not the Commissioner. Dynamo Holdings Ltd. P’ship v. Commissioner, 150 T.C. 224, 234–36 (2018). Partners may only raise partner-level defenses to penalties in a subsequent partner-level p

§ 301.6320-1(f)(2), Q&A-F3 (“An issue is not properly raised if the taxpayer fails to request consideration of the issue by Appeals . . . .”); see also LG Kendrick, LLC v. Commis- sioner, 146 T.C. 17, 34 (2016), aff’d, 684 F. App’x 744 (10th Cir. 2017); Giamelli v. Commissioner, 129 T.C. 107, 115 (2007). Because peti- tioner’s underlying tax liabil

Partners must treat any income received from the partnership in a manner consistent with the treatment of that income at the partnership level. § 6222(a). In certain instances, a partner may seek to treat income received from a partnership in a manner inconsistent with the income item’s treatment at the partnership level. § 6662

To prove reasonable cause for failure to pay, the taxpayer must show that he “exercised ordinary business care and prudence in providing for payment of his tax liability and nevertheless was either unable to pay the tax or would suffer undue hardship if he paid the tax on the due date.” Hardin v. 6 [*6] Commissioner, T.C. Memo.

§§ 301.6320-1(e)(2), 301.6330-1(e)(2). Then there’s our jurisdiction in stand-alone cases. A spouse may also ask for innocent-spouse relief outside a deficiency case or a CDP hearing. If she does, and if the Commissioner denies her relief, she may, “[i]n addition to any other remedy provided by law, . . . petition [us] (and [we] shall have jurisdict

Thus, during that period, IDS and NPA, LLC were both classified as “disregarded entities” for Federal income tax purposes under section 301.7701-3(b)(1)(ii), Proced.

Section 7430(a)(1) provides that a taxpayer who prevails in an administrative proceeding before the Internal Revenue Service (IRS) concerning “the determination, collection, or refund of any tax, interest, or penalty” may be entitled to an award of the reasonable costs incurred in connection with the administrative proceeding.

301.6402-3(a)(5), Proced. & Admin. Regs., provides in relevant part: “If the taxpayer indicates on its return (or amended return) that all or part of the overpayment shown by its return (or amended return) is to be applied to its estimated income tax for its succeeding taxable year, such indication shall constitute an election to so apply such

. v. Commissioner, 152 T.C. 138, 144 (2019). The approval requirement of sec. 6751(b)(1) does not apply to additions to tax under secs. 6651(a)(2) and 6654. See sec. 6751(b)(2)(A). - 12 - [*12] meaningfully in such a hearing or proceeding. See also sec. 301.6320- 1(e)(1), Proced. & Admin. Regs. Both requirements are met here. First, Mr. Galloway appealed the rejection of the 2017 OIC to the Office of Appeals, which ultimately sustained the COIC unit’s rejection on the ground that the “amount you

In the letter petitioners cited section 301.6330-1(d), Proced.

301.7122-1, Proced. & Admin. Regs. The IRS may compromise a tax liability on this basis where the taxpayer’s assets and income render full collection unlikely. Id. para. (b)(2). We do not independently assess the reasonableness of a taxpayer’s proposal. Nor do we substitute our judgment for the SO’s as to the acceptability of any par- ticular

Because petitioner did not make meaningful challenges to the penalties, his underlying liabilities were not raised properly, and therefore, his underlying liability is not at issue before us. See Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. We review respondent’s determinations regarding the proposed collection action related to those liabilities for abuse of discretion. Following a CDP hearing the settlement officer must determine wh

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see also Giamelli v. Commissioner, 129 T.C. at 114-115. The taxpayer does not properly raise an issue during the hearing if it fails to present “any evidence with respect to that issue after being given a reasonable opportunity” to do so. LG Kendrick v. Commissioner, at *13 (quoting section 301

Section 301.7623-1(c)(4), Proced. & Admin. Regs., provides in relevant part that, if the whistleblower does not provide specific and credible information, the WBO has the discretion to reject the claim or inform the whistleblower of any deficiencies and provide the whistleblower an opportunity to perfect the claim for award. The regulation goes on

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect is generally a conscious, intentional failure or reckless indifference. United States v. Boyle, 469 U.S. 241, 245 (1985). Respondent has not sought summary judgment on this issue. We find that a genuine dispute of material fact exists with respect to whether petitioner had reasonable cau

Section 301.6330-1(f)(2), Q&A-F4, Proced. & Admin. Regs., defines the administrative record as Appeals’ case file, including “any * * * documents or materials relied upon by the Appeals officer * * * in making the determination under section 6330(c)(3)”. At trial petitioner offered, as Exhibit 513-P, a collection of canceled checks and bank stateme

in bankruptcy. Therefore we do not address this argument as part of our review. See Rule 34(b)(4). - 5 - [*5] OPINION Section 6330(b) allows a taxpayer to challenge a proposed levy before the IRS Office of Appeals (Appeals)5 in a CDP hearing, see sec. 301.6330-1(b)(1), Proced. & Admin. Regs., and section 6330(d) provides for Tax Court review of an Appeals determination to sustain the levy. A taxpayer may challenge in a CDP hearing the existence or amount of the underlying tax liability that the

ec. 6212(b)(1); Hoyle v. Commissioner, 131 T.C. 197, 200, 203-204 (2008), supplemented by 136 T.C. 463 (2011). A taxpayer’s last known address is generally the address appearing on her “most recently filed and properly processed Federal tax return.” Sec. 301.6212-2(a), Proced. & Admin. Regs. Petitioner does not dispute that the notice of deficiency for 2015 was pro- perly mailed to her “last known address.” Sec. 6212(b)(1). This address appears to be her grandmother’s, and petitioner has used it

Economic hardship, as defined in Rev.

8.7.7.13 (May 15, 2012) includes the following “[n]ote: See Treasury Regulation section 301.6404-2(c) for examples of ministerial and managerial acts.

rdingly, the Internal Revenue Service Office of Appeals (“IRS Appeals”) treated P’s request for a hearing under I.R.C. sec. 6330 as untimely, see I.R.C. sec. 6330(a)(2) and (3), and provided instead an equivalent hearing under Served 01/14/21 - 2 - sec. 301.6330-1(i)(1), Proced. & Admin. Regs. After the equivalent hearing, IRS Appeals issued a decision letter sustaining the Notice. P petitioned the Court seeking review of IRS Appeals’ decision. R filed a Motion to Dismiss for Lack of Jurisdictio

301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.; see also Baltic v. Commissioner, 129 T.C. 178, 183 (2007); Lewis v. Commissioner, 128 T.C. 48, 62 (2007); Daniel v. Commissioner, T.C. Memo. 2009-28, 97 T.C.M. (CCH) 1120, 1122. In November 2011 petitioner was incarcerated at the Taft Correctional Insti- tution in Taft, California. The SO confi

301.6651-1(c), Proced. & Admin. Regs. Willful neglect is defined as a “conscious, intentional failure or reckless indifference.” United States v. Boyle, 469 U.S. 241, 245 (1985). Reasonable cause for a failure to file exists where the taxpayers exercised ordinary care and prudence but were nevertheless unable to file the return by the due date

the ground of duplication with the instant case. In their earlier petition, petitioners alleged that they had submitted to the IRS an offer-in-compromise of their 2012 tax liability, predicating the offer on doubt as to liability. See sec. 7122(a); sec. 301.7122-1(b)(1), Proced. & Admin. Regs. They alleged that they had filed, in October 2019, an amended return for 2012, reporting what they believed their correct tax liability to be. Urging that the IRS had improperly rejected their offer, they

Whether a taxpayer has “reasonable cause” within the meaning of section 6651(a)(1) depends on whether the taxpayer “exercised ‘ordinary business care and prudence’ but nevertheless was ‘unable to file the return within the prescribed time.’” Boyle, 469 U.S.

a requesting spouse will suffer economic hardship if payment of part or all of the tax liability “will cause the requesting spouse to be unable to pay reasonable basic living expenses.” Rev. Proc. 2013-34, sec. 4.03(2)(b), 2013-43 I.R.B. at 401; see sec. 301.6343-1(b)(4)(i), Proced. & Admin. Regs. The determination as to what constitutes a reasonable amount for basic living expenses may vary with the circumstances of the individual taxpayer but will not include the maintenance of an affluent or

301.6402-3(a)(5), Proced. & Admin. Regs. Section 6511(a) specifies that the taxpayer must submit a claim by the later of: (1) three years from the time the relevant return is filed, or (2) two years from the time the tax was paid. For the purposes of section 6511(a) the three-year period of limitation begins on the filing due date, including e

SO Walsh’s decision to reject their OIC. The Secretary can compromise an outstanding tax liability on three grounds: (1) doubt as to liability, (2) doubt as to collectibility, or (3) the promotion of effective tax administration. See sec. 7122(a); sec. 301.7122-1(b), Proced. & Admin. Regs. The Secretary may execute a compromise based on doubt as to collectibility--the ground that petitioners advanced in their OIC--in situations in which the taxpayer’s assets and income are less than the full am

ng costs. BRC argues that, as a single-member disregarded entity, it cannot be classified as a partnership for Federal tax purposes and therefore the FPAA is invalid. BRC did, however, file a partnership return for tax year 2008. Under sec. 6233 and sec. 301.6233-1, Proced. & Admin. Regs., respondent may treat BRC as a partnership for the tax year for purposes of subchapter C of chapter 63 of the Code. See Marcy v. Commissioner, T.C. Memo. 2018-42, at *10 (“The filing of a partnership return, ev

Section 301.7623-1(c)(4), Proced. & Admin. Regs., provides that, if a whistleblower fails to offer “specific and credible information” concerning a violation of internal revenue laws, “the Whistleblower Office may reject the claim or notify the whistleblower of the - 34 - [*34] deficiencies and provide the whistleblower an opportunity to perfect t

c. 2016-55, sec. 3.54, 2016-45 I.R.B. 707, 717; Rev. Proc. 2017-58, sec. 3.54, 2017-45 I.R.B. 489, 499. Where a prevailing party establishes that a special factor applies, the Court may depart upward from the statutory rate. Sec. 7430(c)(1)(B)(iii); sec. 301.7430-4(b)(3)(iii)(B), Proced. & Admin. Regs. Petitioner contends that he is entitled to an enhancement of the statutory rate because it would be impossible to retain qualified counsel at the statutory rate and because of the difficulty of th

301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. If an Appeals officer follows all statutory and administrative guidelines and provides a reasoned and balanced decision, the Court will not reweigh the equities. E.g., Rebuck v. Commissioner, T.C. Memo. 2016-3, at *15. IRM pt. 5.14.1.4(4) (Sept. 19, 2014) states that, generally, installment agre

ved a notice of deficiency for the same year. See sec. 6330(c)(2)(B). Even if the SO had addressed petitioner’s underlying liability, his consideration would not have revived a precluded issue. See Behling v. Commissioner, 118 T.C. 572, 579 (2002); sec. 301.6330-1(e)(3), Q&A-E11, Proced. & Admin. Regs. (“Any determination * * * made by the Appeals officer with respect to * * * a precluded issue shall not be treated as part of the Notice of Determination * * * and will not 3 A grant of audit reco

of a whistleblower’s submission to determine whether the claim, on its face, meets minimum standards. See Van Bemmelen v. Commissioner, 155 T.C. at 81-83; Lacey v. Commissioner, 153 T.C. at 159-160; Worthington v. Commissioner, T.C. Memo. 2020-141; sec. 301.7623-1(c)(1), (4), Proced. & Admin. Regs.21 As relevant here, a rejection occurs when the 21See also Tax Relief and Health Care Act of 2006, Pub. L. No. 109-432, sec. 406(b)(1)(B), 120 Stat. at 2960 (requiring the WBO to “analyze information

The 20% payment of the offer amount is treated as a payment of tax rather than a refundable deposit under section 7809(b) or section 301.7122-1(h), Proced.

301.6651-1(c), Proced. & Admin. Regs. - 12 - [*12] Under section 7491(c) the Commissioner bears the burden of production with respect to the liability of the taxpayer for any additions to tax. See Higbee v. Commissioner, 116 T.C. at 446-447. Petitioner filed his 2016 income tax return after the due date. Therefore, respondent’s burden of prod

and prudence but nevertheless was unable to file the return 9(...continued) sympathetic to petitioner’s situation, any such reliance does not overcome the imposition of the additional tax. - 11 - within the prescribed time. Boyle, 469 U.S. at 246; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect is defined as a “conscious, intentional failure or reckless indifference.” Boyle, 469 U.S. at 245. Whether the elements that constitute “reasonable cause” are present in a given situation i

301.7701-3(b), Proced. & Admin. Regs. (providing that a single-member LLC is a disregarded entity). Accordingly, Kelly Capital, Kelly Investments, Kelly Hospitality, FSIF, Virtucon, KY&C, Radius Mortgage, and LBHorizons did not file entity-level returns for the years at issue, and Kelly Finance did not file entity-level returns for 2007 throug

301.6330- 1(e)(1), Proced. & Admin. Regs. Generally, CNC status may be available when a taxpayer has no ability to make payments. See Internal Revenue Manual (IRM) pt. 5.16.1.1 (Sept. 18, 2018). We have previously ruled an Appeals officer does not abuse his or her discretion in denying CNC status where the taxpayer has not submitted the financ

h, listed only the Ryders and Ryder Investment Partners, Ltd., as its members. This operating 61 For income tax purposes, an LLC with only one member may be treated as the member’s sole proprietorship--otherwise known as a “disregarded entity.” See sec. 301.7701-3, Proced. & Admin. Regs. - 157 - [*157] agreement included a “Family Estate Planning Objectives” section laying out that a material purpose of the company is to further the estate planning objectives of the Ryders. Ryder executed in Apr

301.7623-2(a)(2), (b)(1) and (2), Example (2), Proced. & Admin. Regs. Held, further, the construction of I.R.C. sec. 7623(b)(1), as set forth in these regulations, is valid under Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (1984). Scott A. Knott, Erica L. Brady-Gitlin, and Gregory S. Lynam, for petitioner. Paul Colleran

301.7623-3(c)(7), Proced. & Admin. Regs. On the other hand “[a] denial is a determination that relates to or implicates taxpayer information.” Id. subpara. (8). The Code provides for two types of whistleblower awards: discretionary and nondiscretionary. Section 7623(a) authorizes the Commissioner to pay sums necessary for “detecting underpayme

to challenge them during her CDP hearing and that, because she did challenge them (albeit unsuccessfully), she may challenge them in this proceeding. We agree. See sec. 6330(c)(2)(B); Gluck Irrevocable Tr. v. Commissioner, 154 T.C. 259, 269 (2020); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Respondent concedes the penalty assessed with respect to the 2008 Form 1040 copy No. 2. We accept that concession. Otherwise respondent denies that he erred in assessing the remaining five penaltie

ter, the Secretary must provide written notice to the taxpayer. Secs. 6320(a), 6323(a). Within 30 days commencing after the end of the five business days, the taxpayer may request an administrative hearing before an Appeals officer. Sec. 6320(b)(1); sec. 301.6320-1(c)(1), Proced. & Admin. Regs. If an administrative hearing is requested, the hearing is conducted by Appeals. At - 7 - [*7] the hearing, the settlement officer must verify that the requirements of any applicable law or administrative

alcon elected to be treated as a partnership and Falcon’s partners included Mr. Morgan and an S corporation. Because one of its partners is a pass-thru entity, Falcon is not subject to the small partnership exception. See sec. 6231(a)(1)(B)(i), (9); sec. 301.6231(a)(1)-1(a)(2), Proced. & Admin. Regs. TEFRA did not apply to Falcon for 2012 because in that year Falcon was taxed as a disregarded entity. - 34 - [*34] accordance with the tax return[] filed by the[] partnership[].” Roberts v. Commissi

301.7122-1(b)(2), Proced. & Admin. Regs. The Secretary may compromise a tax liability on this basis where the taxpayer’s assets and income render full collection unlikely. Id. Conversely, the Secretary may reject an OIC when the taxpayer’s RCP exceeds the amount he proposes to pay. See Johnson v. Commissioner, 136 T.C. 475, 486 (2011), aff’d,

301.6103(h)(4)-1(a), Proced. & Admin. Regs. Therefore, the WBO “may disclose returns and return information * * * to a whistleblower (or the whistleblower’s legal representative, if any) to the extent - 53 - [*53] necessary to conduct a whistleblower administrative proceeding”. Id. para. (b). As we explained in Van Bemmelen v. Commissioner, 1

301.6330-1(f)(2), Q&A-F1, Proced. & Admin. Regs. If - 6 - [*6] the taxpayer does not file his petition within this 30-day period, the Court lacks jurisdiction to review the IRS collection action. See Guralnik v. Commissioner, 146 T.C. 230, 235-238 (2016); Orum v. Commissioner, 123 T.C. 1 (2004), aff’d, 412 F.3d 819 (7th Cir. 2005); Sarrell v.

ng costs. BRC argues that, as a single-member disregarded entity, it cannot be classified as a partnership for Federal tax purposes and therefore the FPAA is invalid. BRC did, however, file a partnership return for tax year 2008. Under sec. 6233 and sec. 301.6233-1, Proced. & Admin. Regs., respondent may treat BRC as a partnership for the tax year for purposes of subchapter C of chapter 63 of the Code. See Marcy v. Commissioner, T.C. Memo. 2018-42, at *10 (“The filing of a partnership return, ev

Section 601.202(b), Statement of Procedural Rules, provides that the Commissioner will use one of two forms for closing agreements: (1) Form 866, Agreement as to Final Determination of Tax Liability, generally used to determine conclusively a taxpayer’s total tax liability for a taxable period; and (2) Form 906, which is the type at issue here, generally used if

301.6651-1(c)(1), Proced. & Admin. Regs. Reasonable cause exists if the taxpayer exercised ordinary business care and prudence but nevertheless could not file. Id. The burden of showing reasonable cause under section 6651(a)(1) remains with the Sonis. See Higbee v. Commissioner, 116 T.C. at 447. Reasonable cause for delay is established where

301.7623-4(d)(2), Proced. & Admin. Regs. -11- administrative decision because the amount of the award the WBO recommended in the letter remained uncertain. See id. Additionally, respondent has not subsequently confirmed the amount of award by issuing petitioner a final decision letter or award check on which the Court’s jurisdiction might be

earing. Secs. 301.6330-1(i)(1), 301.6320-1(i)(1), Proced. & Admin. Regs. Although similar to a CDP hearing, an equivalent hearing does not result in a determination subject to judicial review. See Craig v. Commissioner, 119 T.C. 252, 258-259 (2002); sec. 301.6330-1(i)(2), Q&A-I6, Proced. & Admin. Regs. - 5 - [*5] Telephone calls between the settlement officer and a representative of Kidz University followed. On March 14, 2018, the settlement officer contacted the representative and tentatively a

tion 6651(a)(2) is similar to the analysis of reasonable cause pursuant to section 6651(a)(1) except that undue financial hardship may be a defense to the failure to pay.” Hardin v. Commissioner, T.C. Memo. 2012-162, 103 T.C.M. (CCH) 1861, 1863; see sec. 301.6651-1(c)(1), Proced. & Admin. Regs. “To establish undue hardship, the taxpayer must show that making the tax payment on time would have required ‘the risk of a substantial financial loss.’” Hardin, 103 T.C.M. (CCH) at 1863 (quoting Merriam

301.7701-3(a) and (b)(1), Proced. & Admin. Regs. 5The listing of the Smaldino Family Trust as a 49% partner appears to have been in error. For subsequent years the LLC’s Schedules K-1 listed the Dynasty Trust as the 49% partner. -13- [*13] INVESTMENTS, LLC”. He did not elect to split the gift,6 and he did not report any gift to Mrs. Smaldino.

301.6330-1(i)(2), Q&A-I7, Proced. & Admin. Regs. Mr. Benson’s Form 12153 was filed more than a year after the issuance of the 2016 notice of intent to levy, and the IRS Office of Appeals accordingly deemed him ineligible for an equivalent hearing relating to the levy notice. - 5 - [*5] requested documents or otherwise communicate with the set

301.7122-1(b), Proced. & Admin. Regs. The estate proposed to compromise its estate tax liability based on doubt as to collectibility. The Secretary may compromise a tax liability based on doubt as to collectibility where the taxpayer’s assets and income render full collection unlikely. Id. subpara. (2). Conversely the IRS may reject an OIC whe

h, listed only the Ryders and Ryder Investment Partners, Ltd., as its members. This operating 61 For income tax purposes, an LLC with only one member may be treated as the member’s sole proprietorship--otherwise known as a “disregarded entity.” See sec. 301.7701-3, Proced. & Admin. Regs. - 157 - [*157] agreement included a “Family Estate Planning Objectives” section laying out that a material purpose of the company is to further the estate planning objectives of the Ryders. Ryder executed in Apr

h, listed only the Ryders and Ryder Investment Partners, Ltd., as its members. This operating 61 For income tax purposes, an LLC with only one member may be treated as the member’s sole proprietorship--otherwise known as a “disregarded entity.” See sec. 301.7701-3, Proced. & Admin. Regs. - 157 - [*157] agreement included a “Family Estate Planning Objectives” section laying out that a material purpose of the company is to further the estate planning objectives of the Ryders. Ryder executed in Apr

of a whistleblower’s submission to determine whether the claim, on its face, meets minimum standards. See Van Bemmelen v. Commissioner, 155 T.C. at 81-83; Lacey v. Commissioner, 153 T.C. at 159-160; Worthington v. Commissioner, T.C. Memo. 2020-141; sec. 301.7623-1(c)(1), (4), Proced. & Admin. Regs.21 As relevant here, a rejection occurs when the 21See also Tax Relief and Health Care Act of 2006, Pub. L. No. 109-432, sec. 406(b)(1)(B), 120 Stat. at 2960 (requiring the WBO to “analyze information

h, listed only the Ryders and Ryder Investment Partners, Ltd., as its members. This operating 61 For income tax purposes, an LLC with only one member may be treated as the member’s sole proprietorship--otherwise known as a “disregarded entity.” See sec. 301.7701-3, Proced. & Admin. Regs. - 157 - [*157] agreement included a “Family Estate Planning Objectives” section laying out that a material purpose of the company is to further the estate planning objectives of the Ryders. Ryder executed in Apr

h, listed only the Ryders and Ryder Investment Partners, Ltd., as its members. This operating 61 For income tax purposes, an LLC with only one member may be treated as the member’s sole proprietorship--otherwise known as a “disregarded entity.” See sec. 301.7701-3, Proced. & Admin. Regs. - 157 - [*157] agreement included a “Family Estate Planning Objectives” section laying out that a material purpose of the company is to further the estate planning objectives of the Ryders. Ryder executed in Apr

an v. Commissioner, 130 T.C. at 49-50. This Court considers a taxpayer's challenge to his underlying tax liability in a CDP case only ifhe properly raised that challenge at his CDP hearing. Giamelli v. Commissioner, 129 T.C. 107, 114-116 (2007); see sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. An issue is not properly raised at the CDP hearing ifthe taxpayer fails to request consideration ofthat issue by the SO or if he requests consideration but fails to present any evidence after bein

301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. We will not substitute our - 11 - [*11] judgment for the SO's, recalculate the taxpayer's ability to pay, or independently determine what would be an acceptable offer. See Thompson, 140 T.C. at 179; Lipson v. Commissioner, T.C. Memo. 2012-252. In considering a taxpayer's eligibility for an IA a

y are to prevail, must prove that the failure to timely file (1) did not result from willful neglect and (2) was due to reasonable cause. See United States v. Boyle, 469 U.S. 241, 245-246 (1985); Crocker v. Commissioner, 92 T.C. 899, 912-913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect has been defined as a "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. Reasonable cause exists where the taxpayer exercised ordinary business care and pru

rees under Wis. Stat. sec. 242.08(4). B. Federal Transferee Requirement For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principle ofsubstance over form applies to determinations oftransferee liability issues. See generally Scott v. Commissioner, T.C. Memo. 1998-426, afCd, 236 F.3d 1239 (10th Cir. 2001). In accordance with

301.7430-4(a), Proced. & Admin. Regs. CDP hearings held pursuant to I.R.C. secs. 6320 and 6330 are generally considered collection actions and not administrative proceedings. See sec. 301.7430-3(a)(4), (b), Proced. & Admin. Regs. Reasonable litigation costs do not include the value of SERVED Jul 01 2020 - 2 - [*2] the personal time in handlin

301.7701-3(a), Proced. & Admin. Regs. Partnerships don't actually pay taxes, but file a Form 1065 as an information return, and the income "flows through" to its partners. M sec. 701; 6611, Ltd. v. Commissioner, T.C. Memo. 2013-49, at *4 n.3, *44. (All section references are to the Internal Revenue Code in effect for the year at issue, and all

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect connotes "a conscious, intentional failure or reckless indifference" with respect to timely filing. United States v. Boyle, 469 U.S. 241, 245 (1985). Respondent determined that the Larkins are liable for additions to tax pursuant to section 6651(a)(1) for 2008, 2009, and 2010 for failure

gs. See Smith v. Com- missioner, 133 T.C. 424, 428 & n.3 (2009). Petitioner was entitled to challenge his liability for these penalties at the CDP hearing unless he had had a prior oppor- - 13 - [*13] tunity to dispute them. See sec. 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A- E2, Proced. & Admin. Regs. A taxpayerhas had a prior opportunityto dispute a liability ifhe participated in an earlier CDP hearing, received a notice of determination regarding the same liability, and was entitled to petiti

301.6212-2(a), Proced. & Admin. Regs. A notice of deficiency is valid even ifthe taxpayer's address includes an inconsequential error. Yusko v. Commissioner, 89 T.C. 806, 810 (1987). We have previously said an error in a ZIP Code was inconsequential. See, e.g., Lee v. Commissioner, T.C. Memo. 2011-129, 2011 WL 2271722, at *3; Sebastian v. Comm

sident alien), a C corporation, or an estate ofa deceased partner." That limitation "is applied to the number ofnatural persons, C corporations, and estates ofdeceased partners that were partners at any one time during the partnership taxable year." Sec. 301.6231(a)(1)-1(a)(1), Proced. & Admin. Regs. Thus, a partnership qualifies for the exception for a taxable year only ifit meets the 10-or-fewer limitation throughout that year. M id. subpara. (3) ("The determination ofwhether a partnership mee

Conversely, section 6213(b)(4) and section 301.6213-1(b)(3), Proced.

y file was due to reasonable cause and not due to willful neglect. "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs. The taxpayer can show that he did not act with "willful neglect" if he can "prove that the late filing did not result from a 'conscious, intentional failure or reckless indifference.'" Niedringhaus v. Com

Montgomery v. Commissioner, 122 T.C. 1, 8-9 (2004). A taxpayer must properly present an underlying liability challenge at the CDP hearing in order to preserve that challenge forjudicial review. See Giamelli v. Commissioner, 129 T.C. 107, 113 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 7 - [*7] sound basis in fact or law. See Murphy v. Commissioner, 125 T.C. 301, 320 (2005), M, 469 F.3d 27 (1st Cir. 2006). B. Abuse ofDiscretion In deciding whether the SO abused her discretion

Montgomery v. Commissioner, 122 T.C. 1, 8-9 (2004). A taxpayermust properly present an underlying liability challenge at the CDP hearing in order to preserve that challenge forjudicial review. See Giamelli v. Commissioner, 129 T.C. 107, 113 (2007); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 7 - [*7] Section 6159 authorizes the Commissioner to enter into an IA ifhe deter- mines that it will facilitate full or partial collection ofa taxpayer's unpaid liability. S_e_e Thompson v. Comm

rees under Wis. Stat. sec. 242.08(4). B. Federal Transferee Requirement For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principle ofsubstance over form applies to determinations oftransferee liability issues. See generally Scott v. Commissioner, T.C. Memo. 1998-426, afCd, 236 F.3d 1239 (10th Cir. 2001). In accordance with

301.7701-4(d), Proced. & Admin. Regs. The regulations provide that, subject to certain other requirements: "An organization will be considered a liquidating trust ifit is organized for the primary purpose ofliquidating and distributing the assets transferred to it, and ifits activities are all reasonably necessary to, and consistent with, the

sident alien), a C corporation, or an estate ofa deceased partner." That limitation "is applied to the number ofnatural persons, C corporations, and estates ofdeceased partners that were partners at any one time during the partnership taxable year." Sec. 301.6231(a)(1)-1(a)(1), Proced. & Admin. Regs. Thus, a partnership qualifies for the exception for a taxable year only ifit meets the 10-or-fewer limitation throughout that year. M id. subpara. (3) ("The determination ofwhether a partnership mee

r for tax years 2011 and 2012 was invalid insofar as adjustments to or from Dani, LLC, were determined, as Dani, LLC, was an LLC whose members included two grantor trusts at all relevant times and therefore was subject to TEFRA. See sec. 6231(a)(9); sec. 301.6231(a)(1)-1(a)(2), Proced. & Admin. Regs. Therefore, petitioner argues that this Court lacksjurisdiction. For the reasons discussed below, we find that the notice ofdeficiency was valid and that this Court has jurisdiction. II. TEFRA and Se

y file was due to reasonable cause and not due to willful neglect. "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs. The taxpayer can show that he did not act with "willful neglect" if he can "prove that the late filing did not result from a 'conscious, intentional failure or reckless indifference.'" Niedringhaus v. Com

rees under Wis. Stat. sec. 242.08(4). B. Federal Transferee Requirement For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principle ofsubstance over form applies to determinations oftransferee liability issues. See generally Scott v. Commissioner, T.C. Memo. 1998-426, afCd, 236 F.3d 1239 (10th Cir. 2001). In accordance with

301.7623-1(c)(2), Proced. & Admin. Regs. - 3 - [*3] Court received the petition appealing the denial on May 14, 2018, in an envelope bearing a U.S. Postal Service postmark ofApril 30, 2018. Respondent filed the pending motion on August 12, 2020, wherein he argues that petitioner did not file a petition within the limitations period set forth

to exceed 25% in the aggregate. Sec. 6651(a)(1). Reasonable cause exists ifthe taxpayer exercised ordinary business care and prudence but nevertheless could not file or pay the tax when due. United States v. Boyle, 469 U.S. 241, 245 (1985); see also sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Circumstances that may constitute "reasonable cause" include (among other things) unavoidable postal delays, the timely filing ofa return with the wrong IRS office, the death or serious illness ofa taxpay

301.7623-1(c)(4), Proced. & Admin. Regs., we infer that the WBO continued to consider that petitioners' claims, like MDA's, presented "specific credible documentation".) TEGE's referral to CI A subject matter expert ("SME") at TEGE received petitioners' claims on March 16, 2018. On April 2, 2018, the SME "[r]eceived an E-Mail from Lynn Brinkle

301.7623-1(c), Proced. & Admin. Regs. (providing that claims may be rejected ifthey supply "speculative information or * * * do not provide specific and credible information regarding tax underpayments or violations ofinternal revenue laws"). When the Office rejects a claim, "the written notice [to the claimant] will state the basis for the re

301.6231(a)(6)- 1(a), Proced. & Admin. Regs. - 8 - [*8] assets or income." He asserted that his reasonable collection potential (RCP)8 was limited to $15,500, the purported value ofan art collection and wine that he owned. He enclosed $3,500 with his OIC and represented that, upon acceptance, he would pay the remaining balance of$14,000 withi

301.6404-2(b), Proced. & Admin. Regs. In any event we lackjurisdiction to consider a request for abate- "(...continued) (wholly apart from the litigation support payments). See supra note 2. Petitioners conceded these adjustments in full and offered no reasonable cause for their failure properly to report those items. - 34 - [*34] ment ofinte

301.6212-2(a), Proced. & Admin. Regs. Section 6212(b)(2) provides that, in the case ofajoint return, and where the Commissioner is aware that spouses have established separate residences, a duplicate original ofajoint notice ofdeficiency shall be sent to each spouse. "It is well settled that a notice ofdeficiency mailed to a taxpayer's last kn

Section 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs., states in pertinent part: Q-E2. When is a taxpayer entitled to challenge the existence or amount ofthe tax liability specified in the CDP Notice? A-E2. A taxpayer is entitled to challenge the existence or amount ofthe underlying liability for any tax period specified on the CDP Notice ifthe

be no more intrusive than necessary", sec. 6330(c)(2), (3)(C). A taxpayer is "expected to provide all relevant information requested by Appeals, including financial statements, for its consideration ofthe facts and issues involved in the hearing." Sec. 301.6320-1(e)(1), Proced. & Admin. Regs. Ifthe taxpayer is dissatisfied with the outcome ofthe CDP hearing, he can appeal that determination to the Tax Court, as petitioner has done. Sees. 6320(c), 6330(d)(1). Where the underlying tax liability i

verify that the IRS satisfied the notice requirements ofsection 6320(a)(2). The settlement officer did not abuse her discretion in this regard. Section 6320(a)(2)(C) provides that an NFTL shall be sent to the taxpayer's last known address. See also sec. 301.6320-1(a)(1), Proced. & Admin. Regs. A taxpayer's last known address is "the address that appears on the taxpayer's most recently filed and properly processed Federal tax return, unless the Internal Revenue Service (IRS) is given clear and c

e chance to seek prepayment review in this Court. See Gunther v. Commissioner, at *8-*9. - 9 - [*9] Ifan affected item does not require partner-level determinations, the normal deficiency procedures do not apply. See sec. 6230(a)(1) and (2)(A)(i); sec. 301.6231(a)(6)-1(a)(2), Proced. & Admin. Regs. In that instance the Commissioner may immediately assess the resulting tax deficiency without issuing a notice ofdeficiency. See Woods, 571 U.S. at 39. The partner against whom such an assessment is m

agency). The administrative record in a whistleblower case normally is expected to include "all information provided by the whistleblower (whether provided with the whistleblower's original submission or through a subsequent contact with the IRS)." Sec. 301.7623-3(e)(2)(i), Proced. & Admin. Regs. The - 16 - information that a whistleblowerprovides to the IRS' operating divisions before submitting a Form 211 to the WBO may be relevant to the whistleblower's claim for an award. See Whistleblower2

aring. We consider a taxpayer's challenge to his - 12 - [*12] underlying tax liabilities in a collection action case only ifhe properly raised the liabilities at an administrative hearing. Giamelli v. Commissioner, 129 T.C. 107, 114-116 (2007); see sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. An issue is not properly raised at the administrative hearing ifthe taxpayer fails to request consideration ofthe issue or ifhe requests consideration but fails to present any evidence after being

301.7623-1(c), Proced. & Admin. Regs. (providing that claims may be rejected if they supply "speculative information or * * * do not provide specific and credible information regarding tax underpayments or violations ofinternal revenue laws"). - 8 - [*8] When the Office rejects a claim, "the written notice [to the claimant] will state the bas

underlying tax liability in this Court ifthe taxpayer did not present sufficient information during the CDP hearing process with respect to that issue after being given a reasonable opportunity to do so. Delgado v. Commissioner, T.C. Memo. 2011-240; sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. We review the Commissioner's determination de novo ifthe existence or amount ofthe taxpayer's underlying liability is properly at issue. Goza v. Commissioner, 114 T.C. 176 , 181-182 (2000). We rev

s involvement in an entity was active or passive is a partner-level determination. See Estate ofQuick v. Commissioner, 110 T.C. 172, 187 (1998), supplemented by 110 T.C. 440 (1998). And, while contributions to partnerships are partnership items, see sec. 301.6231(a)(3)-1(a)(4)(i), Proced. & Admin. Regs., the contributions at issue are from years before Deep Creek elected to be treated as an S corporation. There is no indication that either King's Dominion or SS Marine was subject to TEFRA at the

Ancira v. Commissioner, 119 T.C. 135, 138 (2002); McGaugh v. Commissioner, T.C. Memo. 2016-28. But we have also found that, when a distributee had unfettered ¹While it was not stipulated by the parties, we assume that Ball LLC made no election under sec. 301.7701-3(c), Proced. & Admin. Regs., to be classified as a corporation. See sec. 301.7701-3(b)(1)(ii), Proced. & Admin. Regs. (providing that a domestic LLC that has a single owner is disregarded as an entity separate from that owner in the ab

. With respect to such liabilities, the regulations provide that "[a]n opportunityto dispute the underlying liability includes a prior opportunity for a conference with Appeals that was offered either before or after the assessment ofthe liability." Sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. Patrick's Payroll does not dispute that it received a 30-day letter affording it the opportunityto contest its 2010 and 2011 underlying liabilities before the Office ofAppeals. Nor does it deny th

the additions to tax, petitioners would have to show that each failure to timely file (1) did not result from willful neglect and (2) was due to reasonable cause. See Boyle, 469 U.S. at 245-246; Crocker v. Commissioner, 92 T.C. 899, 912-913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect has been defined as a "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. Reasonable cause exists where the taxpayer exercised ordinary business care and pru

301.6320-1(e)(3), Q&A-E2, Proced. & Admin. Regs. (stating that a prior opportunityto dispute a liability "includes a prior opportunity for a conference with Appeals"); see also Iames v. Commissioner, 850 F.3d 160, 165- 167 (4th Cir. 2017) (holding that a taxpayer's prior opportunity for a conference with Appeals occurred when he appeared at th

ial review. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A tax- payer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); Giamelli v. Commissioner, 129 T.C. 107, 113-114 (2007) (same); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. During the CDP hearing petitioner contended that the IRS had improperly disallowed its NOL for 2012 and as a consequence had erroneously determined its 2014 and 2015 liabilities by disallowing its

rees under Wis. Stat. sec. 242.08(4). B. Federal Transferee Requirement For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principle ofsubstance over form applies to determinations oftransferee liability issues. See generally Scott v. Commissioner, T.C. Memo. 1998-426, afCd, 236 F.3d 1239 (10th Cir. 2001). In accordance with

301.7623-1(c)(1), Proced. & Admin. Regs. (providing that claims may be rejected ifthey supply "speculative information" or "do not provide specific and credible information regarding tax underpayments or violations ofinternal revenue laws"). When the Office rejects a claim, "the written notice [to the claimant] will state the basis for the rej

301.7502-1(a), (c)(1)(iii)(A), Proced. & Admin. Regs. Here, the date postmark stamped on the envelope is August 20, 2019; that is, more than 90 days from the date the petition was due. Accordingly, the petition was not timely mailed to the Court. - 6 - [*6] Conclusion We conclude that the Court lacksjurisdiction in this case because petitione

filing an appeal with the IRS when he receives a Letter 1153. See - 10 - Mason v. Commissioner, 132 T.C. 301, 317-318 (2009); Lewis v. Commissioner, 128 T.C. 48, 61 (2007); Thompson v. Commissioner, T.C. Memo. 2012-87, 103 T.C.M. (CCH) 1470, 1472; sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. The IRS sent petitioner two Letters 1153, and the administrative record shows that he received both ofthem. Because he had an opportunityto dispute his TFRP liabilities upon receipt ofthese letters

forjudicial review. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); Giamel- li v. Commissioner, 129 T.C 107, 113-114 (2007); sec. 301.6330-1(f)(2), - 8 - [*8] Q&A-F3, Proced. & Admin. Regs. "'An issue is not properly raised ifthe taxpayer fails * * * to present * * * any evidence with respect to that issue after being given a reasonable opportunity' to do so." Moriarty v.

underlying tax liability during a CDP hearing (and thereafter in this Court) ifhe did not receive a notice ofdeficiency with respect to the liability or did not otherwise have an earlier opportunity to dispute the liability. See sec. 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.; see also DAF Charters v. Commissioner, 152 T.C. at __ (slip op. at 11) (and cases cited thereat). Petitioner's liability for the section 6651(a)(3) addition to tax for the year at issue is not su

301.6402-3(a)(5), Proced. & Admin. Regs. Accordingly, respondent properly treated the 2005 overpayment as ajoint estimated payment for 2006. Applying to the facts at hand the rules ofsection 1.6654-2(e)(5)(ii), Income Tax Regs., we ask whether petitioner and Milton agreed to allocate their 2005 overpayment (and the estimated payments Milton ma

301.7623-3(c)(8), Proced. & Admin. Regs. - 15 - [*15] B. Standard and scope ofTax Court review ofwhistleblower awards Section 7623(b)(4) provides that a "determination regarding an award" may be "appealed to the Tax Court (and the Tax Court shall havejurisdiction with respect to such matter)." As we held in Kasper v. Commissioner, 150 T.C. at

Schwager copies ofhis literal transcripts with all the assessment information required to be provided to him under section 6203 and section 301.6203-1, Proced.

ary business care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside the taxpayer's control. See McMahan v. Commissioner, 114 F.3d 366, 368-369 (2d Cir. 1997), § T.C. Memo. 1995-547; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. It is well established that the filing ofan unsigned return form is - 20 - [*20] not the filing ofa valid return. See Elliott v. Commissioner, 113 T.C. 125, 128 (1999); see also Mohamed v. Commissioner, T

301.7623-1(c)(1), (4), Proced. & Admin. Regs. (providing the WBO determines whether the claim provides specific and credible information or - 12 - [*12] speculative or substantive information, reports a violation ofinternal revenue laws and identifies the target taxpayer, and provides information that the whistleblowerbelieves will lead to th

ec. 6212(b)(1); Hoyle v. Commissioner, 131 T.C. 197, 200, 203-204 (2008), supplemented by 136 T.C. 463 (2011). A taxpayer's last known address is generally the address appearing on his "most recently filed and properly processed Federal tax return." Sec. 301.6212-2(a), Proced. & Admin. Regs. The administrative record shows that the IRS mailed a valid notice ofdefi- ciency to petitioner's last known address. He did not dispute receipt ofthat notice, either before the SO or in his petition. His un

t the Appeals Office - 7 - [*7] with any evidence regarding that liability after being given a reasonable opportunityto do so." Gentile v. Commissioner, T.C. Memo. 2013-175, 106 T.C.M. (CCH) 75, 76, affd, 592 F. App'x 824 (11th Cir. 2014); see also sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Petitioner admits that he "did not raise an issue as to the reported tax due * * * for 2015 and 2016." But he asserts that he did dispute his liability for addi- tions to tax and interest. He quali

301.7623-1(c), Proced. & Admin. Regs. (providing that claims may be rejected ifthey supply "speculative information or * * * do not pro- vide specific and credible information regarding tax underpayments or violations ofinternal revenue laws"). When the Office rejects a claim, "the written notice [to the claimant] will state the basis for the

missioner, 114 T.C. at 609. This Court considers a taxpayer's challenge to his underlying liability in a collection action case only ifhe properly raised that challenge at his CDP hearing. See Giamelli v. Commissioner, 129 T.C. 107, 115-116 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. An issue is not properly - 13 - [*13] raised at the CDP hearing ifthe taxpayer fails to request consideration of that issue by Appeals or ifhe requests consideration but fails to present any eviden

ec. 6663 penalties for the years in issue. 3Pursuant to sec. 6213(a), a petition for redetermination ofa deficiency must be filed with this Court within 90 days after the notice ofdeficiency is mailed to the taxpayer. See also sec. 7502; Rule 34(a); sec. 301.7502-1(a), Proced. & Admin. Regs. On September 21, 2017, the Court rendered an Oral Findings of Fact and Opinion in which we addressed, among other things, the timeliness of petitioners' filing. We concluded that the record showed that the p

e chance to seek prepayment review in this Court. See Gunther v. Commissioner, at *8-*9. - 9 - [*9] Ifan affected item does not require partner-level determinations, the normal deficiency procedures do not apply. See sec. 6230(a)(1) and (2)(A)(i); sec. 301.6231(a)(6)-1(a)(2), Proced. & Admin. Regs. In that instance the Commissioner may immediately assess the resulting tax deficiency without issuing a notice ofdeficiency. See Woods, 571 U.S. at 39. The partner against whom such an assessment is m

. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP - 8 - [*8] hearing."); Giamelli v. Commissioner, 129 T.C. 107, 113-114 (2007) (same); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. "'An issue is not properly raised ifthe taxpayer fails * * * to present * * * any evidence with respect to that issue after being given a reasonable opportunity to' do so." Moriarty v. Commissioner

301.7701-3(a), Proced. & Admin. Regs. Partnerships don't actually pay taxes, but file a Form 1065 as an information return, and the income "flows through" to its partners. M sec. 701; 6611, Ltd. v. Commissioner, T.C. Memo. 2013-49, at *4 n.3, *44. (All section references are to the Internal Revenue Code in effect for the year at issue, and all

301.7623-1(c)(4), Proced. & Admin. Regs. This initial evaluation occurs before any further action on the information set forth in the claim. The threshold criteria by which the WBO evaluates a claim's potential eligibility for an award include that the claim: • "contain[s] specific * * * information"; • "contain[s] * * * credible information";

301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. As a rule, an SO may "ac- cept, at a minimum, a monthly payment equal to the excess ofa taxpayer's month- ly income over the taxpayer's allowable expenses." Boulware v. Commissioner, T.C. Memo. 2014-80, 107 T.C.M (CCH) 1419, 1426, M, 816 F.3d 133 (D.C. Cir. 2016); see Bero v. Commissioner, T.C.

301.7623-1(c)(4), Proced. & Admin. Regs.4 This initial evaluation occurs before any referral to an IRS operating division for further action on the information set forth in the claim. Consequently, a threshold rejection by the WBO will necessarily preclude any administrative or judicial action against any taxpayer and any collection ofproceeds

ner, T.C. Memo. 2020-18, at *17; see also Gazi v. Commissioner, T.C. Memo. 2007-342, 94 T.C.M. (CCH) 474, 479 (2007) ("There is no requirement that the Commissioner wait a certain amount oftime before making a determination as to a proposed levy."); sec. 301.6320-1(e)(3), Q&A-E9, Proced. & Admin. Regs.8 C. Balancing Analysis Ms. Biggs-Owens did not allege on petition or argue at any later point that the settlement officer failed to consider "whether any proposed collection action balances the ne

e time being. Shenk v. Commissioner, T.C. Memo. 2015-193, 110 T.C.M. (CCH) 332, 333. Petition- 3(...continued) T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 8 - [*8] er's account was placed in CNC status almost two years before the levy on her State tax refund. Because the IRS had already determined that petitioner should not be subjected to collect

(CCH) 441, 443 (quoting section 301.6330- 1(f)(2), Q&A-F3, Proced.

ofthe WBO's determinations. - 11 - [*11] T.C. at 20. In this context the administrative record "comprises all information contained in the administrative claim file that is relevant to the award determination and not protected by * * * privileges." Sec. 301.7623-3(e)(1), Proced. & Admin. Regs. The administrative claim file, in turn, is defined to include the "Form 211, 'Application for Award for Original Information,' filed by the whistleblower and all information provided by the whistleblower (

ity filed Form 1065, U.S. Return of Partnership Income, for 2011. And the parties stipulated that Mr. Carter is the entity's tax matters partner. See sec. 6231(a)(7). We therefore infer that Dover Hall Plantation, LLC, did not file an election under sec. 301.7701-3(c), Proced. & Admin. Regs., to be classified as a corporation for Federal tax purposes and that it is properly classified as a partnership. The parties also stipulated that Messrs. Carter and Evans were the partnership's only partners

thus precluded from disputing its liability for the penalties in this Court. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 9 - [*9] evant issues petitioner raised, and (3) determined whether "any proposed collection action balances the need for the efficient collection oftaxes with the legitimate concern of* * * [pe

301.7701-1(a)(1), Proced. & Admin. Regs. Whether an organization is an entity separate from its owners for Federal tax purposes is a matter ofFederal tax law and does not depend on whetherthe organization is recognized as an entity under local law. R Relevant to this case, IRA sec. 17 corporations are not recognized as separate entities for Fe

business care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside the taxpayer's control. See McMahan v. Commissioner, 114 F.3d 366, 368-369 (2d Cir. 1997), aff'g T.C. Memo. 1995-547; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. With an extension, petitioner's 2014 Federal income tax return was due on October 15, 2015. He filed his return on January 22, 2016, more than three months after the due date. Petitioner failed to introdu

e propriety ofpurported collection actions regarding tax year 2011. We dismissed that claim for lack ofjurisdiction. S_e_e secs. 6320(c), 6330(d); see also Atl. Pac. Mgmt. Grp., LLC v. Commissioner, 152 T.C. __, __ (slip op. at 5-7) (June 20, 2019); sec. 301.6320-1(i)(2), Q&A-I6, Proced. & Admin. Regs. Discussion A. Standard ofReview We havejurisdiction to review the Office ofAppeals' determination pursuant to sections 6320(c) and 6330(d)(1). See Murphy v. Commissioner, 125 T.C. 301, 308 (2005),

procedural or mechanical act that does not involve the exercise ofjudgment or discretion, and that occurs during the processing ofa taxpayer's case after all prerequisites to the act, such as conferences and review by supervisors, have taken place." Sec. 301.6404-2(b)(2), Proced. & Admin. Regs. A "[mlanagerial act" is "an administrative act that occurs during the processing ofa taxpayer's case involving SAlthough sec. 6404(b) limits sec. 6404(a), it does not alter the IRS' authorityunder sec. 64

(CCH) 1861, 1863 (citing section 301.6651-1(c)(1), Proced.

he exception that we must review whetherthe Appeals Office verified that the requirements ofany applicable law or administrative procedure have been met. S_e_e Hoyle v. Commissioner, 131 T.C. 197, 202-203 (2008), supplemented by 136 T.C. 463 (2011); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. When the underlying tax liability was properly at issue in the CDP hearing, we review - 7 - the Commissioner's determination de novo. Sego v. Commissioner, 114 T.C. 604, 610 (2000). Other administ

301.6651-1(c)(1), Proced. & Admin. Regs. Petitioner husband filed his 2013 Federal income tax return on January 7, 2015. He filed his 2015 Federal income tax return on November 7, 2016. Respondent has shown that petitioner husband failed to timely file his Federal income tax returns for 2013 and 2015. Consequently, we conclude that respondent

301.6651- 1(c)(1), Proced. & Admin. Regs. ATL did not present any argument or other evidence showing that it exercised such care and prudence or that it was unable to timely file the Form 1120S. Instead, ATL argues that the reasonable cause exception should apply because ATL's two shareholders were aware ofthe business loss for taxable year 20

301.6330-1(e)(1), Proced. & Admin. Regs.; see also sec. 301.6320-1(e)(1), Proced. & Admin. Regs. Such information is necessary for a settlement officer to evaluate a taxpayer's -12- [*12] ability to pay and to weigh the appropriateness ofany collection alternative. We have often observed that a settlement officer does not abuse her discretion

301.6323(j)-1(c), Proced. & Admin. Regs. - 10 - [*10] Because NFTL withdrawal is a collection alternative, see sec. 301.6320- 1(e)(3), Q&A-E6, Proced. & Admin Regs., petitioners were required to provide SO Piro with relevant information for her to consider in determining whether the NFTL should be withdrawn, see Roudakov v. Commissioner, T.C.

Section 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs., provides that a taxpayerwho is seeking Tax Court review ofa determination ofAppeals in a CDP case can "only ask the court to ¹°(...continued) overpayment credit from another year. We concluded that this was a challenge to the taxpayer's underlying tax liability, i.e., "the amount unpaid afte

301.6330-1(c)(2), Q&A-C1, C3, C4, Proced. & Admin. Regs. In their hearing request petitioners alleged no inability to pay and expressed no interest in a collection alternative. Nor did they dispute that their 2015 return showed an underpayment oftax. Rather, they asserted that they were entitled to a 2Petitioners attached to their response to

we are precluded from considering petitioner's liability challenge. A taxpayer may dispute his underlying tax liability in a CDP case only ifhe properly raised that issue at the CDP hearing. S_e_e Giamelli v. Commissioner, 129 T.C. 107, 113 (2007); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Petitioner did not raise the issue in the Office ofAppeals, and thus we cannot consider it now.6 6Petitioner attached to his summaryjudgment opposition what appears to be the first page ofan undate

thus be precluded from challenging his underlying liabilities in any event. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Thus, we review the SO's actions for abuse ofdiscretion. See Goza v. Commissioner, 114 T.C. at 181-182. IV. Abuse ofDiscretion The taxpayerbears the burden ofproving that the settlement officer exe

301.7623-4(d)(2), Proced. & Admin. Regs. Thus, the fact that the first letter was titled a "final determina- - 7 - [*7] tion" did not prevent the Office from issuing a subsequent determination regarding petitioner's claim that would createjurisdiction in this Court. See sec. 7623(b)(4) (granting this Courtjurisdiction over "[a]ny determinatio

in the decision letter * * * [as] a 'deter- mination' for purposes ofsection 6330(d)(1)." Ibid. The IRS issued the Letter 1058 on March 24, 2016. Petitioner was required to submit his request for a CDP hearing within 30 days. See sec. 6330(a)(3)(B); sec. 301.6330-1(b)(1), Proced. & Admin. Regs. Because April 23, the 30th day after the date on the notice, was a Saturday, the period for submitting the hearing request was extended to the following Monday, April 25. See sec. 7503. Peti- tioner's req

301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.; Mason v. Commissioner, 132 T.C. 301, 317-318 (2009). Therefore a person who has received a Letter 1153 cannot in a CDP hearing dispute the existence or amount ofthe TFRP. See sec. 301.6330-1(e)(3), Q&A- E2, Proced. & Admin. Regs.; Bletsas v. Commissioner, T.C. Memo. 2018-128, at *8-*9. 3. Posit

ness", so that the gain from its sale was "section 1231 gain", as defined by section 1231(a)(3)(A). Thus, they reported the gain from CSG's sale of Unit B as long-term capital gain not by reason ofsection 1222(3), which defines "(...continued) under sec. 301.7701-3(c), Proced. & Admin. Regs., to be classified as a corporation. See sec. 301.7701-3(b)(1)(ii), Proced. & Admin. Regs. (providing that a domestic LLC that has a single owner is disregarded as an entity separate from that owner in the ab

mber 30, 2019. The Court received petitioners' petition on January 5, 2016. Because the envelope in which it was mailed bore a United States Postal Service postmark dated December 26, 2015, the petition is treated as timely filed. See sec. 7502(a); sec. 301.7502-1(c)(1), Proced. & Admin. Regs. - 10 - [*10] one with respect to which deductions are allowable for the taxable year under section 162 or under paragraph (1) or (2) ofsection 212." The expectation ofprofit need not have been reasonable;

(CCH) 441, 443 ("'An issue is not properly raised ifthe taxpayer fails * * * to present to Appeals any evidence * * * after being given a reasonable opportunity' to do so." (quoting section 301.6330-1(f)(2), Q&A-F3, Proced.

deemed to have been delivered to the Court on that date. See sec. 7502(a) (providing that date ofpostmark be treated as date ofdelivery of"any * * * document required to be filed * * * under authority ofany provision ofthe internal revenue laws"); sec. 301.7502-1(b)(1)(iii), Proced. & Admin. Regs. (defining "document", for purposes ofthe "timely mailed, timely filed" rule ofsec. 7502, to include petitions filed with the Tax Court). - 4 - [*4] Hanszen House was built in 1930 on 4.89 acres ofland

Because they did not make such a request, we do not address that argument.) Section 1.911-7(a)(4), Income Tax Regs., provides that inadvertent errors or omissions do not render an election invalid ifthey are not material in determining whether the individual is a qualified individual or intends to make the election.

301.6020-1(b)(1), Proced. & Admin. Regs., adds "frivolous" to the adjectives describing the disfavored class ofreturn. -7- [*7] that the income tax is an excise tax that does not apply to the income they received and failed to report. Except for petitioners' receipt ofthe Harborstone interest payments, petitioners bear the burden ofproof. See

g tax liability during a CDP hearing (and thereafter in this Court) ifhe did not receive a notice ofdeficiency with respect to the liability or did not otherwise have an earlier opportunityto dispute the liability. See secs. 6320(c), 6330(c)(2)(B); sec. 301.6320-1(e)(3), Q&A-E2, Proced. & Admin. Regs.; see also Kuykendall v. Commissioner, 129 T.C. 77, 80 (2007); Sego v. Commissioner, 114 T.C. at 609; Shere v. Commissioner, T.C. Memo. 2008-8, slip op. at 10. Although the parties have stipulated a

301.7122-1(b), Proced. & Admin. Regs. Doubt as to collectibility exists in any case where the taxpayer's assets and income are less than the full amount ofthe tax liability. Id. subpara. (2). Generally, under respondent's administrative pronouncements, an OIC based on doubt as to collectibility will be acceptable only ifthe offer reflects the

301.7701-1(a)(1), Proced. & Admin. Regs. Whether an organization is an entity separate from its owners for Federal tax purposes is a matter ofFederal tax law and does not depend on whetherthe organization is recognized as an entity under local law. R Relevant to this case, IRA sec. 17 corporations are not recognized as separate entities for Fe

301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs.; see also Rebuck v. Commissioner, T.C. Memo. 2016-3; Kuretski v. Commissioner, T.C. Memo. 2012-262, aff'd, 755 F.3d 929 (D.C. Cir. 2014). In reviewing the SO's detennination we do not independently evaluate what would be an acceptable collection alternative. Thompson v. Commissioner, 140 T.C. at

301.7623-1(c)(4), Proced. & Admin. Regs.; and the Commissioner has not contended here that the WBO was entitled to ignore Mr. Lacey's second submission nor that Mr. Lacey is precluded from relying on it. Thus, the issue is not whether the WBO characterized the second submission as a distinct claim but whether it failed properly to consider tha

301.7701-2(a), Proced. & Admin. Regs. (All section references are to the Internal Revenue Code and regulations in effect (continued...) - 4 - [*4] Burbach's firm specializes in designing municipal pools and aquatic facilities,4 but it does much more. The firm's "pre-design services," according to Burbach, are "the reason why a lot ofcities hi

ised the issue ofhis underlying liabilities before Appeals. Our review ofAppeals' determination under section 6330(c)(3) is limited to the issues that a taxpayer raises before Appeals. Giamelli v. Commissioner, 129 T.C. 107, 114-115 (2007); see also sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. But see Hoyle v. Commissioner, 131 T.C. 197, 202-203 (2008) (holding that the Court may, however, review whether an Appeals officer met the verification requirements prescribed in section 6330(c)(

rhas made a satisfactory showing that he exercised ordinary business care and prudence in providing for payment ofhis tax liability and was nevertheless either unable to pay the tax or would suffer an undue hardship * * * ifhe paid on the due date." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs. The regulations further state: In determining whether the taxpayerwas unable to pay the tax in spite ofthe exercise ofordinary business care and prudence in providing for payment ofhis tax liability, cons

ayer, and (iii) determined whether "any proposed collection action balances the need for the efficient collection oftaxes with the legitimate concern ofthe person that any collection action be no more intrusive than necessary." Sec. 6330(c)(3); see sec. 301.6330-1(e), Proced. & Admin. Regs. This Court has stated that it is not an abuse ofdiscretion for the Appeals Office to determine that a taxpayer is ineligible for a collection alternative ifthe taxpayer does not provide the requested financia

had reasonable cause, a taxpayermust show that he or she exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time. See sec. 6651(a)(1); Crocker v. Commissioner, 92 T.C. 899, 913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. - 44 - [*44] Regs. Petitioner contends that he had reasonable cause to file late because he was concerned about meticulously substantiating his expenses based on his experience in prior audits." We disagree. Th

portunityto do so. Cropper v. Commissioner, 826 F.3d 1280, 1289 (10th Cir. 2016), af[g T.C. Memo. 2014-139; Portwine v. Commissioner, T.C. Memo. 2015-29, at *8, aff'd, 688 F. App'x 838 (10th Cir. 2016); Delgado v. Commissioner, T.C. Memo. 2011- 240; sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. During remand - 13 - [*13] petitioner provided no support for the allegation in his petition that he owes no tax for 2003. In his second motion for summaryjudgment petitioner contends that the Cou

thorized Internal Revenue Officer or employee signs and uses to identify a set of documents containing the information set forth in this paragraph as a section 6020(b) return, and the documents identified, constitute a return under section 6020(b)." Sec. 301.6020-1(b)(2), Proced. & Admin. Regs.; see also Rader v. Commissioner, 143 T.C. 376, 382 (2014), M, 616 F. App'x 391 (10th -13- [*13] Cir. 2015). The combination ofdocuments assembled by the IRS for each year, including Form 13496, Form 4549-

(CCH) 441, 443 (quoting section 301.6330-1(f)(2), Q&A-F3, Proced.

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect connotes "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. Petitioner's 2011 tax return was due April 17, 2012. It was filed June 24, 2013. Respondent has met his burden ofproduction. Petitioner failed to show reasonable cause for not timely filing his 20

301.6330-1(d)(2), Q&A-D6, Proced. & Admin. Regs. This Court has consistentlyheld that a face-to-face hearing is not required pursuant to section 6320 or 6330, and a proper CDP hearing may be held by telephone or by correspondence under certain circumstances. See Katz v. Commissioner, 115 T.C. 329, 337-338 (2000); Rice v. Commissioner, T.C. Mem

301.6320-1(f)(2), Q&A- F3, Proced. & Admin. Regs.; see also Giamelli v. Commissioner, 129 T.C. 107, - 8 - [*8] 115 (2007). Petitioner did not raise the underlying liabilities for the years at issue during his CDP hearing. Where the validity ofthe underlying tax liability is not at issue, we review the settlement officer's administrative deter

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. ("An issue is not properly raised * * * ifconsideration [ofan issue] is re- quested but the taxpayer fails to present to Appeals any evidence[.]"). In any event petitioner failed to carry his burden ofproving that he did not receive during 2012 wages of$55,819 and taxable retirement distribution

301.6320-1(a)(2), Q&A-A10, Proced. & Admin. Regs. The amount ofthe unpaid liability was correctly stated in the CDP notice, and Mrs. Kestin does not claim that she was unaware ofany portion ofthe penalty liabilities that the IRS asserted; much less does she explain what she would or could have done differently during the CDP process ifthe May

as properly addressed to the Tax Court and that the postmark is missing. They disagree as to whether the envelope was deposited in the U.S. mail on or before December 3, 2014. The regulations prescribe distinct rules for USPS and non-USPS postmarks, sec. 301.7502-1(c)(1)(iii), Proced. & Admin. Regs., but they supply no rules to govern the situation where the envelope has no postmark whatsoever. When a postmark is missing, our case law instructs us to deem the postmark illegible and permit the in

301.7502-1(c)(1)(iii)(A), Proced. & Admin. Regs., places on the taxpayerthe burden to prove the date an illegible postmark was made. On March 12, 2019, we issued an order directing petitioner to sustain her burden ofestablishing that the postmark was timely made. On March 24, 2019, petitioner responded to our order and supplemented the record

Section 301 explains when a distribution from a corporation is included in gross income, applied against basis, or treated as a gain from the sale or exchange - 24 - [*24] ofproperty. See sec. 301(c). A distribution ofproperty made by a corporation to a stockholder is included in the stockholder's income as a dividend to the extent ofthe corporati

301.6330-1(f)(2), Q&A- F3, Proced. & Admin. Regs.; see also Giamelli v. Commissioner, 129 T.C. 107, - 12 - [*12] 115 (2007). Petitioner did not raise the underlying liabilities for the years in issue during his CDP hearing. Where the validity ofthe underlying tax liability is not at issue, we review the settlement officer's administrative det

st the existence or amount ofthe underlying liability at the hearing ifthe taxpayerdid not receive a notice of deficiency with respect to the liability or did not otherwise have an earlier opportunityto dispute the liability. See sec. 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.; see also Kuykendall v. Commissioner, 129 T.C. 77, 80 (2007); Shere v. Commissioner, T.C. Memo. 2008-8, slip op. at 10. Following the hearing, the Appeals officer must determine among other things

ilities at the CDP hearing and is thus precluded from challenging them here. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 7 - [*7] In his CDP hearing request petitioner checked the box marked "I Cannot Pay Balance" and requested lien discharge. During the hearing the SO outlined the documentation petitioner needed

y file was due to reasonable cause and not due to willful neglect. "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs. The taxpayer can show that he did not act with "willful neglect" if he can "prove that the late filing did not result from a 'conscious, intentional failure or reckless indifference.'" Niedringhaus v. Com

Section 301.6212-2(a), Proced. & Admin. Regs., effective January 29, 2001, generally defines it as the address that appears on the taxpayer's most recently filed and properly processed Federal tax return unless the IRS is given clear and concise notification ofa different address. This Court and other Federal courts, even before the effective date

(CCH) 441, 443 (quoting section 301.6330-1(f)(2), Q&A-F3, Proced.

Section 301.7122-1(b)(2), Proced. & Admin. Regs., lists doubt as to collectibility as a valid ground for compromising an unpaid liability. "Doubt as to collectibility exists in any case where the taxpayer's assets and income are less than the full amount ofthe liability." Id. Generally, under the Commissioner's administrative guidelines, Appeals wi

tions not relevant here, the decision to accept or reject an IA lies within the Commis- sioner's discretion. See Rebuck v. Commissioner, T.C. Memo. 2016-3; Kuretski v. Commissioner, T.C. Memo. 2012-262, , 755 F.3d 929 (D.C. Cir. 2014); - 12 - [*12] sec. 301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. We will not substitute ourjudgment for the SO's, recalculate the taxpayer's ability to pay, or independently determine what would be an acceptable offer. See Thompson, 140 T.C. at 179; Lipson v. Co

hat he was eligible for withdrawal, section 6323(j) "is permissive, and nothing in it requires respondent to withdraw the NFTL because of* * * [an] installment agreement." Berkery v. Commissioner, T.C. Memo. 2011-57, 101 T.C.M. (CCH) 1258, 1260; see sec. 301.6323(j)-1(c), Proced. & Admin. Regs. ("Ifthe Commissioner determines conditions for with- drawal [ofan NFTL] are present, the Commissioner may (but is not required to) authorize the withdrawal."). The SOs did not abuse their discretion in de

e reasonable cause for a failure to file timely, the taxpayermust show that he exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time. Crocker v. Commissioner, 92 T.C. 899, 913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. To prove reasonable cause for a failure to pay the amount shown as tax on a return, the taxpayermust show that he exercised ordinary business care and prudence in providing for payment ofhis tax liability

301.6343-1(b)(4), Proced. & Admin. Regs. Petitioner relies on child support and Government assistance to meet her basic living expenses. While she has some education, she was unemployed throughout the marriage and was able to secure only part-time employment for a briefperiod after the divorce. Petitioner's approximate monthly income is $3,371

301.6330-1(e)(1), Proced. & Admin. Regs. Petitioner failed to submit amended returns as instructed by the SO or otherwise present evidence credibly calling into question the underlying liabilities after being given reasonable opportunityto present such evidence. Thus, petitioner did not raise a proper challenge to the underlying liabilities. S

his underlying liability for 2014, he seeks to contest his liability for 2007. But he did not (and could not) raise a prop- er challenge to that liability during the CDP hearing because it was not for a tax period "specified on the CDP Notice." See sec. 301.6330-1(e)(3), Q&A-E2, Pro- ced. & Admin. Regs. He is thus precluded from challenging his 2007 liability in this case. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013). - 8 - [*8] Section 6159 authorizes the Commissioner to enter into a

301.6320-1(d)(2), Q&A-D1, Proced. & Admin. Regs. (noting the availability ofan additional CDP hearing when the IRS makes "an additional assessment oftax"). At that hearing petitioner could advance procedural arguments, challenge the propriety ofa lien or levy, or propose collection alternatives in the form ofan offer-in-compromise or install-

301.6651-1(c)(1), Proced. & Admin. Regs. Petitioner husband filed his 2013 Federal income tax return on January 7, 2015. He filed his 2015 Federal income tax return on November 7, 2016. Respondent has shown that petitioner husband failed to timely file his Federal income tax returns for 2013 and 2015. Consequently, we conclude that respondent

301-7.12(a)(2) (1994 & 1996) provides explicitly that the M&IE rate must be reduced when the Government provides an employee with meals at no charge counters petitioner's argument that we should not reduce the M&IE rates to take into account his employer-provided meals. [Emphasis added.] The Court further stated that "petitioner has not specif

rdinary business care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside the taxpayer's control. See McMahan v. Commissioner, 114 F.3d 366, 369 (2d Cir. 1997), § T.C. Memo. 1995-547; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Petitioner was required to file a return for 2012 and failed to do so. See sec. 6012(a)(1)(A). Petitioner failed to introduce any credible evidence showing that he had reasonable cause for failing to file

301.7701-2(a), Proced. & Admin. Regs. (All section references are to the Internal Revenue Code and regulations in effect (continued...) - 4 - [*4] Burbach's firm specializes in designing municipal pools and aquatic facilities,4 but it does much more. The firm's "pre-design services," according to Burbach, are "the reason why a lot ofcities hi

- 8 - [*8] support its decision, or the agency misapplies the law."), § T.C. Memo. 2007-175. C. Underlying Liability A taxpayer can challenge the existence or amount ofan underlying liability ifit is for a "tax period specified on the CDP Notice," sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs., and ifhe had no prior opportunityto dispute it, Sego v. Commissioner, 114 T.C. 604, 609 (2000). However, "[a] taxpayer is precluded from disputing the underlying liability ifit was not properly ra

301-7.12(a)(2) (1994 & 1996) provides explicitly that the M&IE rate must be reduced when the Government provides an employee with meals at no charge counters petitioner's argument that we should not reduce the M&IE rates to take into account his employer-provided meals. [Emphasis added.] The Court further stated that "petitioner has not specif

301.6402-3(a)(1) and (2), Proced. & Admin. Regs.; see also Dixon v. United States, 7 Cl. Ct. 377 (1985), nor on the form promulgated by the IRS for requesting reliefunder section 6015, Form 8857, "Request for Innocent Spouse Relief",5 see 26 C.F.R. sec. 5In part VII ofthe form ("Tell us ifyou would like a refund"), line 31 reads: "By checking

SO August also reviewed section 301.6343-1(b)(4), Proced.

301.6320-1(e)(1), Proced. & Admin. Regs. Petitioner has not disputed its underlying tax liability or that the Appeals Office performed the necessary verification under section 6330(c)(1). Instead, petitioner asserts that the SO abused her discretion in denying its request for an installment agreement because she seemed to raise the bar every t

301.6651-1(c)(1), Proced. & Admin. Regs. Petitioner husband filed his 2013 Federal income tax return on January 7, 2015. He filed his 2015 Federal income tax return on November 7, 2016. Respondent has shown that petitioner husband failed to timely file his Federal income tax returns for 2013 and 2015. Consequently, we conclude that respondent

Com- missioner, 122 T.C. 1, 8-9 (2004). However, a taxpayer must properly present an underlying liability challenge at the CDP hearing in order to preserve that chal- lenge forjudicial review. See Giamelli v. Commissioner, 129 T.C. 107, 113 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. In prior cases we have ruled that taxpayers did not properly present such a challenge when they failed to submit during a CDP hearing an amended return stating what they be- lieved their correct t

Tax Court. Sec. 6330(d)(1). III. Standard ofReview In general a taxpayer must raise an issue at a CDP hearing to preserve it for this Court's review. Perkins v. Commissioner, 129 T.C. 58, 63 (2007); Magana v. Commissioner, 118 T.C. 488, 493 (2002); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Petitioner challenged the underlying liabilities during the CDP hearing by asserting that he was not a responsible person for purposes ofsection 6672. Thus, the issue ofpetitioner's liability is p

The determination ofwhether a spouse will suffer economic hardship is based on rules similar to section 301.6343-1(b)(4), Proced.

penalties previously determined at the partnership level. Under section 6230, partner-level defenses are "those that are personal to the partner or are dependent upon the partner's separate return and cannot be determined at the partnership level." Sec. 301.6221-1(d), Proced. & Admin. Regs. The tax treatment ofpartnership items and the applicability ofany penalty, addition to tax, - 23 - [*23] or additional amount that relates to an adjustment to a partnership item is determined at the partners

301.6231(a)(1)-1(a)(2), Proced. & Admin Regs. A passthrough partner is a partnership, estate, trust, S corporation, nominee, or other similar person through whom other persons hold an interest in the partnership and includes disregarded entities such as single-member LLCs. See sec. 6231(a)(9); 6611, Ltd. v. Commissioner, T.C. Memo. 2013-49; Ti

Szczepanski's public policy or equity offer-in-compromise under section 301.7122-1(b)(3)(ii), Proced.

301.7701-2(a), Proced. & Admin. Regs. (All section references are to the Internal Revenue Code in effect for the years at issue, and all Rule references are to the Tax Court Rules of Practice and Procedure, unless we say otherwise.) - 5 - [*5] Release League (BXRL)--a televised release-only fishing league at destination resorts from Marathon,

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

Regs., provides that, ifa taxpayer exercises ordinary business care and prudence and is nevertheless unable to file on time, then the delay is due to reasonable cause.

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

301.6212-2(a), (b)(2), Proced. & - 10 - [*10] Admin. Regs. (defining the taxpayer's "last known address" as the address on the taxpayer's most recently filed and properly processed return unless the IRS has been given "clear and concise notification" ofa different address); see also Ward v. Commissioner, 907 F.2d 517 (5th Cir. 1990), rev'g 92

301.6402-6(g)(3), Proced. & Admin. Regs.; see Terry v. Commissioner, at *7-*8. In this regard, the terms ofthe Treasury offset program place the Commissioner in - 8 - the limited and purely ministerial role ofcollecting those debts referred to him by other Federal agencies. Wooten v. Commissioner, T.C. Memo. 2003-113, slip op. at 10-11. Pursu

ued to them in 2014. Respondent has conceded that petitioners never received that notice ofdeficiency and that they properly challenged their underlying liabilities at their CDP hearing and in their petition. See sec. 6330(c)(2)(B); Rule 331(b)(4); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.¹ We therefore consider petitioners' underlying liabilities on the merits. After concessions (described below) the issues for decision are whether pe- titioners may deduct: (1) certain expenses repo

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

And the distribution by CSE to Paradym is governed entirely by section 301, which does not by itselfimplicate any international tax concerns.

d at 989. But a whistleblower claim will always have at least a small administrative record: the whistleblower's Form 211 and accompanying information. See sec. 7623(b)(6)(C) (requiring the submission ofinformation under penalty ofperjury); see also sec. 301.7623-3(e), Proced. & Admin. Regs. (describing the materials that will be included in the administrative record for a whistleblower claim)." 2. Section 6330 We can also look at section 6330(d), which governs our review of nondeficiency collec

e cited statutoryprovision. Deputy v. 7A taxpayermay elect to apply all or part ofthe overpayment shown on his return to his estimated income tax for the succeeding taxable year. See sec. 6402(b); Weber v. Commissioner, 138 T.C. 348, 356-357 (2012); sec. 301.6402- 3(a)(5), Proced. & Admin. Regs. "The subject ofsuch an election is known as a 'credit elect overpayment' or simply a 'credit elect.'" FleetBoston Fin. Corp. v. United States, 483 F.3d 1345, 1347 (Fed. Cir. 2007). The taxpayer's electio

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

Whether a requesting spouse will suffer economic hardship is determined on the basis ofrules similar to those provided in section 301.6343-1(b) (4), Proced.

301.6330-1(e)(3), Q&A-El1, Proced. & Admin. Regs. - 11 - [*11] did not timely file his returns. See McLaine v. Commissioner, 138 T.C. 228, 244-245 (2012). A taxpayerwill not be liable for an addition to tax under section 6651(a)(1) ifthe taxpayer can show that the failure to file was due to reasonable cause and not willful neglect. See United

administrative record. Kasper II, 150 T.C. at __ (slip op. at 20). "The administrative record comprises all information contained in the ad- ministrative claim file that is relevant to the award determination and not protected by * * * privileges." Sec. 301.7623-3(e)(1), Proced. & Admin. Regs. Respondent - 11 - [*11] may supplement the administrative record (or we may direct that he do so) for a variety ofreasons, e.g., where the IRS action is not adequately explained in the administrative recor

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

agreement will facilitate full or partial collection ofsuch liability." See also Thompson v. Commissioner, 140 T.C. 173, 179 (2013). The decision to accept or reject installment agreements lies within the discretion ofthe Commissioner. Id.; see also sec. 301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. We do not make an independent determination ofwhat would be an acceptable alternative. Murphy v. Commissioner, 125 T.C. at 320. Ifthe Appeals officer follows all statutory and administrative guide

(continued...) - 12 - [*12] not advance these arguments during the CDP hearing or in his petition, we could deem them waived. See Rule 331(b)(4); Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); Magana v. Commissioner, 118 T.C. 488, 493 (2002); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. We will nevertheless address them briefly. Nis Family Tr. v. Commissioner, 115 T.C. 523, 538-539 (2000). Petitioner first contends that the IRS misapplied to his 2002 and 2003 liabil- ities certain

e cited statutoryprovision. Deputy v. 7A taxpayermay elect to apply all or part ofthe overpayment shown on his return to his estimated income tax for the succeeding taxable year. See sec. 6402(b); Weber v. Commissioner, 138 T.C. 348, 356-357 (2012); sec. 301.6402- 3(a)(5), Proced. & Admin. Regs. "The subject ofsuch an election is known as a 'credit elect overpayment' or simply a 'credit elect.'" FleetBoston Fin. Corp. v. United States, 483 F.3d 1345, 1347 (Fed. Cir. 2007). The taxpayer's electio

301.6611-1(h)(2), Proposed Proced. & Admin. Regs., 49 Fed. Reg. 39570 (Oct. 9, 1984). But section 6611(g)(2)(B)(ii) also says that missing information affects the processibility ofa return only ifits absence prevents "the mathematical verification ofthe tax liability as shown on the return." This means that a return can be valid even ifit does

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 14 - Petitioner did not dispute in the Form 12153, during the CDP hearing, in her petition, or at trial the assessment ofher self-reported tax for 2013 or the assessment ofinterest for 2013. The self-reported tax and interest therefore are not properly before the Court. See sec. 301.6320-1(f)

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Respondent concedes that petitioner did not have a prior opportunityto contest his underlying liabilities; thus petitioner was allowed to challenge the underlying liabilities at his CDP hearing. Sec. 6330(c)(2)(B); see also Montgomery v. Commissioner, 122 T.C. at 8-9. Respondent asserts that pet

3, 1987), which provided: "Any distribution by an FSC (or former FSC) to its shareholder with respect to its stock will be includible in the shareholder's gross income in accordance with the provisions ofsection 301." But that regulation does not indicate that we should depart from well-established principles in deciding who, as a matter ofsubstance, the FSC "shareholders" really were, considering the practical economic realities ofthe transactions and taking into account the actual benefits and

301.6233-1T(c), Temporary Proced. & Admin. Regs. * * *; see also sec. 301.6233-1(b), Proced. & Admin. Regs. * * * [W]e could ask what were the entity items ofTigers Eye, as agent. It would seem to make no difference whether we address the agency as a hypothetical entity, acting through Tigers Eye, or address Tigers Eye as an entity in its own

672 (1977); see also Dodge v.

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

ls for the Eleventh Circuit, which affirmed our decision. That decision is now final. See sec. 7481(a)(2). Petitioner cannot relitigate his 2006 Federal income tax liability in this CDP proceeding. See Sego v. Commissioner, 114 T.C. 604, 609 (2000); sec. 301.6320-1(e)(3), Q&A-E2, Proced. & Admin. Regs. While purporting not to challenge our January 2014 decision, petitioner in- sists that he settled his 2006 liability for $1,396 (plus interest) through his 2013 exchange ofcorrespondence with the

alled at the originally appointed time. Administrative hearings are informal and may consist ofone or more oral or written communications. Katz v. Commissioner, 115 T.C. 329, 337-338 (2000) (holding that a face-to-face hearing is not a requirement); sec. 301.6320-1(d)(2), Q&A-D6, Proced. & Admin. Regs. Moreover, a face-to-face hearing will not be granted ifthe taxpayerhas failed to file required returns. Schlegel v. Commissioner, T.C. Memo. 2016-90, at *12; sec. 301.6330-1(d)(2), Q&A-D8, Proced.

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

ies at the CDP hearing and are thus precluded from challenging them here. See Thompson v. Commis- sioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. -10- [*10] C. Analysis In ascertaining whetherthe SO abused his discretion, we review the record to determine whether he: (1) properly verified that the requirements ofapplicable law or administrat

Whether a requesting spouse will suffer economic hardship is determined on the basis ofrules similar to those provided in section 301.6343-1(b) (4), Proced.

lysis are two particular exceptions. First, the period of - 5 - limitations under section 6501 is suspended beginning six months after the service ofa John Doe summons and ending with the final resolution ofthat summons. Sec. 7609(e)(2)(A) and (B); sec. 301.7609-5(d), Proced. & Admin. Regs.3 Second, section 6501(e)(1)(A)(ii) provides that the IRS may assess tax within six years after a return is filed "[i]fthe taxpayer omits from gross income an amount properly includible therein and * * * such

301.6330- 1(d)(2), Q&A-D6, Proced. & Admin. Regs. This Court has consistently held that a face-to-face CDP hearing is not required pursuant to section 6320 or 6330 and that a proper CDP hearing may be held by telephone or by correspondence under certain circumstances. See Giamelli v. Commissioner, 129 T.C. 107, 111-112 (2007); Katz v. Commissi

ems in a partnership-level proceeding is 6¹(...continued) 19, at *33. 62Because we find that Triumph did not have unreported gross receipts for 2010, Triumph did not fail to report net earnings from self-employment for 2010. 63See also sec. 6226(f); sec. 301.6221-1(c), Proced. & Admin. Regs. -50- [*50] conclusive." But a partner may file a claim for refund to challenge the amount ofthe computational adjustment or to assert any partner-level defenses that may apply.65 Section 6662(a) and (b)(1) a

rtnership, increasing the partner's basis in his partnership interest. See secs. 752(a), 722. The regulations promulgated under section 6231(a)(3) clarify that the determination ofa partner's share ofpartnership liabilities is a partnership item.4 4Sec. 301.6231(a)(3)-1(a), Proced. & Admin. Regs., states, in relevant part, that the following items which are required to be taken into account for the taxable year ofa partnership under subtitle A ofthe Code are more appropriately determined at the

301.7701-3(b)(1)(i), Proced. & Admin. Regs. On October 20, 2002, DTDV filed with the Internal Revenue Service (IRS) a Form 1065, U.S. Return ofPartnership Income, for its 2001 taxable year. On that return, DTDV reported distributions and various items of income that it allocated among four partners: petitioner, his wife Lana, Square Leg Ltd. (

301.6231(a)(3)-1(a)(1)(v), Proced. & Admin. Regs. Because section 1461 makes the partnership liable for any tax required to be withheld under section 1446, any tax required to be withheld under section 1446 is a partnership liability. And the regulations are clear that partnership liabilities are partnership items. Most penalties cannot be par

issue not raised in the assignments oferror shall be deemed to be conceded."); Thompson v. Com- missioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 9 - [*9] taxes with the legitimate concern of* * * [petitioners] that any collection action be no more intrusive than necessary." See sec. 6330(c)(3). A taxpayer may raise at a CDP hearing relev

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.7122-1, Proced. & Admin. Regs. The Secretary may compro- mise a tax liability on this basis where the taxpayer's assets and income render full 4(...continued) (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. -

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

agreement will facilitate full or partial collection ofsuch liability." See also Thompson v. Commissioner, 140 T.C. 173, 179 (2013). The decision to accept or reject installment agreements lies within the discretion ofthe Commissioner. Id.; see also sec. 301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. As noted supra p. 14, we will not make an independent determination ofwhat would be an acceptable alternative. Murphy v. Commissioner, 125 T.C. at 320. Ifthe Appeals officer follows all statutory

301.6343-1(b)(4), Proced. & Admin. Regs. Petitioner contends that her age, limited income and other assets, permanent disability, and substantial current and expected obligations establish economic hardship. Petitioner's income consists ofvarious disability payments totaling $1,400 per month. Respondent argues that this factor is neutral becau

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

tment ofa partnership item under TEFRA. Sec. 6231(a)(6). The Commissioner may immediately assess the resulting tax deficiency from the computational adjustment against the partner without issuing a notice ofdeficiency. Sec. 6230(a)(1) and (2)(A)(i); sec. 301.6231(a)(5)-1(b), Proced. & Admin. Regs. In such case the partner does not have access to a prepayment forum to challenge the computational adjustment and must file a refund claim. See sec. 6230(a)(1), (c)(4). For an adjustment that does not

ounded in section 6404, we would still have concluded that we lackedjurisdiction to determine and order the credit or 9(...continued) F.3d 1173 (10th Cir. 2006); Miller v. Commissioner, T.C. Memo. 2000-196, a , 310 F.3d 640 (9th Cir. 2002); see also sec. 301.6404-2(a), Proced. & Admin. Regs. The general abatement provision ofsec. 6404(a), however, authorizes the Secretary to abate "the unpaid portion ofthe assessment ofany tax or any liability in respect thereof" if, among other things, the asse

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see also Giamelli v. Commissioner, 129 T.C. 107, 112-114 (2007); Magana v. Commissioner, 118 T.C. - 9 - [*9] 488, 493 (2002). At a collection due process hearing the taxpayermay raise "any relevant issue relating to the unpaid tax or the proposed levy". Sec. 6330(c)(2)(A). The taxpayermay also

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

633, 639 (1979); see also Power v.

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

301.7701-3(a) and (b)(1)(ii), Proced. & Admin. Regs. We follow that lead. - 4 - [*4] respectively.3 He received taxable IRA distributions, subject to the 10% additional tax under section 72(t), in 2011 and 2012 of$3,550 and $59,333, respectively. And during 2012 he received Social Security benefits of$6,903, the taxable amount ofwhich is agre

pute their tax liabilities until the CDP hearing. To dispute the underlying tax liability, a taxpayer must have raised the merits ofthe underlying tax liability during the CDP hearing. Giamelli v. Commissioner, 129 T.C. 107, 112-116 (2007); see also sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Other than their purported claim for damages under section 7433 articulated in their administrative claim letter, petitioners did not participate in the CDP hearing or challenge their underlying t

301.6330-1(d)(2), Q&A-D6, Proced. & Admin. Regs. This Court has consistentlyheld that a face-to-face CDP hearing is not required pursuant to section 6320 or 6330 and a proper CDP hearing may occur by telephone or by correspondence under certain circumstances. See Giamelli v. Commissioner, 129 T.C. 107, 111-112 (2007); Katz v. Commissioner, 115

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.7701-3(a) and (b)(1), Proced. & Admin. Regs. - 10 - [*10] information you requested" and explained how to get discounted subscriptions to the magazines "The Blood-Horse" and "Thoroughbred Times." E. Stallworthy Scott and Debra tried to get their CPA, Margaret Stallworthy, involved. She told them that she wasn't qualified to give an opinio

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

301.6651-1(c)(1), Proced. & Admin. Regs. "Willful neglect" means a "conscious, intentional failure or reckless indifference." United States v. Boyle, 469 U.S. 241, 245 (1985). °Respondent acknowledged that petitioners were entitled to a first-year depreciation deduction in respect ofthe property in question. The parties shall compute the allow

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

301.6611-1(h)(2), Proposed Proced. & Admin. Regs., 49 Fed. Reg. 39570 (Oct. 9, 1984). But section 6611(g)(2)(B)(ii) also says that missing information affects the processibility ofa return only ifits absence prevents "the mathematical verification ofthe tax liability as shown on the return." This means that a return can be valid even ifit does

Whether a requesting spouse will suffer economic hardship is determined on the basis ofrules similar to those provided in section 301.6343-1(b) (4), Proced.

Form 433-A (OIC) included, among other items, the investment partnership with a value of $162,197, discounted to $129,758, vehicle operating expenses of$1,330, and out- of-pocket health care expenses of$757. They did not include the value ofthe 2See sec. 301.7122-1(b)(3), Proced. & Admin. Regs. (an effective tax administration offer is appropriate only when the taxpayer's assets and income exceed the liability and the taxpayer is able to cover the liability in full). -8- [*8] irrevocable life in

questing spouse to be unable to pay reasonable basic living expenses." R In determining whether the requesting spouse will suffer economic hardship, respondent is to consider the requesting spouse's current income and expenses and the requesting - 17 - [*17] spouse's assets; furthermore, respondent is to base his determination on rules similar to section 301.6343-1(b)(4), Proced.

3, 1987), which provided: "Any distribution by an FSC (or former FSC) to its shareholder with respect to its stock will be includible in the shareholder's gross income in accordance with the provisions ofsection 301." But that regulation does not indicate that we should depart from well-established principles in deciding who, as a matter ofsubstance, the FSC "shareholders" really were, considering the practical economic realities ofthe transactions and taking into account the actual benefits and

Economic hardship occurs when a taxpayer is unable to pay his or her reasonable basic living expenses. Section 301.71220l[sic](c)(3)(iii). Here, petitionerhas a gross monthly income of$9,161. The total allowable expenses computation is $6,985. This difference is equal to $2,176 in discretionary income per month. Petitioner has t

ty is not before us, we review the IRS decision for abuse ofdiscretion only. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A- F3, Proced. & Admin. Regs. Abuse ofdiscretion exists when a determination is arbitrary, capricious, or without sound basis in fact or law. See Murphy v. Commissioner, 125 T.C. 301, 320 (2005), aff'd, 469 F.3d 27 (1st Cir.

447 (2001). To show reasonable cause, the taxpayermust demonstrate that he exercised ordinary business care and prudence but nonetheless was unable to file his income tax return by the due date. See United States v. Boyle, 469 U.S. 241, 246 (1985); sec. 301.6651-1(c), Proced. & Admin. Regs. Willful neglect is defined as a "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. Respondent has met his burden because petitioner filed his 2009 and 2010 returns late. Petit

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

301.6651-1(c)(1), Proced. & Admin. Regs. The obligation to file timely is the taxpayers', unambiguous and nondelegable, and reliance on an agent generally will not amount to reasonable cause for untimely filing. United States v. Boyle, 469 U.S. 241, 249-252 (1985). Taxpayers bear a heavy burden when attempting to prove reasonable cause for fai

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

rs--an important step in Son-of-BOSS deals because partnership assets are then distributed and sold, which supposedly produces tremendous artificial losses. 3 This means that the entities themselves were ignored for federal income- tax purposes, see sec. 301.7701-3(b)(1)(ii), Proced. & Admin. Regs., and the owners were taxed as sole proprietors under the Code with any income or loss of the LLCs reported on their returns, see 301.7701-2(a), Proced. & Admin. Regs. (All section references are to th

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.6203-1, Proced. & Admin. Regs. The assessment does not require the assessment officer's signature on Form 4340. See Nicklaus v. Commissioner, 117 T.C. 117, 121 (2001). Form 4340 provides the details ofthe assessments, including the relevant date that the summary record ofassessment was signed by the assessment officer. The summary record o

301.7701-3(a) and (b)(1), Proced. & Admin. Regs. - 10 - [*10] information you requested" and explained how to get discounted subscriptions to the magazines "The Blood-Horse" and "Thoroughbred Times." E. Stallworthy Scott and Debra tried to get their CPA, Margaret Stallworthy, involved. She told them that she wasn't qualified to give an opinio

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

301.7701- 2(a), Proced. & Admin. Regs. Operation ofthe Medical-Marijuana Dispensary Around September 2009, Altermeds, LLC, opened a retail store under the business name "Altermeds". We refer to this retail store as the "dispensary". The dispensary was in Louisville, Colorado, which is near Boulder, Colorado. The dispensary had regular operatin

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, intentional failure or reckless indifference toward filing or payment obligations. United States v. Boyle, 469 U.S. 241, 245 (1985). The estate contends that decedent did not file an income tax return with the IRS because he was a bona fide resident ofthe USVI and had

Section 301.6212-2(a), Proced. & Admin. Regs., further explains: "A taxpayer's last known address is the address that appears on the taxpayer's most recently filed and properly processed Federal tax return, unless the Internal Revenue Service (IRS) is given clear and concise notification ofa different address." At the time the notice ofdeficiency w

301.7430-3(a), Proced. & Admin. Regs. One ofthose exceptions is requests for private letter rulings (PLR) "or similar determinations". Id. subpara. (2). Respondent contends that recognition oftax-exempt status is a determination similar to a PLR. Both types ofproceeding were described in the - 10 - same revenue procedure in effect at the fili

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

301.6320- 1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see Thompson v. Commissioner, 140 T.C. 173, 178 (2013) (citing Giamelli v. Commissioner, 129 T.C. at 114). - 9 - [*9] Petitioner was entitled to contest the frivolous return penalties at his CDP hearing because he "did not otherwise have an opportunityto dispute such tax liability." Sec. 6330

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

missioner, 125 T.C. 301, 320 (2005), afCd, 469 F.3d 27 (1st Cir. 2006). A taxpayer may dispute her underlying tax liability in a CDP case only if she properly raised that issue at the CDP hearing. Giamelli v. Commissioner, 129 T.C. 107, 113 (2007); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. That standard is met only ifthe taxpayer, after being given a reasonable oppor- tunity to do so, presents evidence addressing the merits ofher underlying liability challenge. See Delgado v. Commiss

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

301.6651-1(c)(1), Proced. & Admin. Regs. A taxpayerdemonstrates willful neglect when his or her actions exhibit a "conscious, intentional failure or - 10 - [*10] reckless indifference" towards compliance with his or her obligations under the Code. United States v. Boyle, 469 U.S. 241, 245 (1985). Petitioner concedes that he failed to file a r

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

301.7701-1(a), Proced. & Admin. Regs.; see a_lso Commissionerv. Tower, 327 U.S. 280, 288, 290 (1946). A partnership is a business entity with two or more parties. See secs. 301.7701-1(a)(1), 301.7701- 3(a) and (b)(1)(i), Proced. & Admin. Regs. The hallmark ofa partnership is that "the participants carry on a trade, business, financial operatio

Whether a requesting spouse will suffer economic hardship is determined on the basis ofrules similar to those provided in section 301.6343-1(b) (4), Proced.

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.7701- 2(c)(2), Proced. & Admin. Regs.; see also Murphy v. Commissioner, 129 T.C. 82, 85 n.5 (2007). For clarity, we continue to refer to the entity as GMLLC. - 5 - [*5] the sole purpose ofeffecting the Son-of-BOSS transaction. None ofthe three entities filed a Federal tax return for 2000. Petitioners' 2000 Federal income tax return report

Whether a requesting spouse will suffer economic hardship is determined on the basis ofrules similar to those provided in section 301.6343-1(b) (4), Proced.

301.7122-1(b), Proced. & Admin. Regs. Petitioners made an OIC on the basis ofdoubt as to collectibility. A determination ofdoubt as to collectibility includes a determination ofability to pay. Sec. 301.7122-1(c)(2)(i), Proced. & Admin. Regs. In determining ability to pay, the Commissioner permits taxpayers to retain sufficient funds to pay bas

One is to ask the IRS for a letter ruling under section 301.9100-3, Proced.

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

301.6231(a)(6)-1T, Temporary Proced. & Admin. Regs., 64 Fed. Reg. 3840 (Jan. 26, 1999).¹4 For example, if"the threshold amount ofmedical deductions under section 213" changes as the result ofa partnership-level determination, that computational adjustment "do[es] not ¹4Sec. 301.6231(a)(6)-1T, a temporary regulation applicable for tax years beg

301.7122-1(b), Proced. & Admin. Regs. At petitioner's initial and supplemental hearings he based his OIC on doubt as to collectibility. The Secretary may compromise a tax liability on the basis ofdoubt as to collectibility where the taxpayer's assets and income render full collection unlikely. Id. subpara. (2). Conversely, the IRS may reject a

301.6233-1T(c), Temporary Proced. & Admin. Regs. * * *; see also sec. 301.6233-1(b), Proced. & Admin. Regs. * * * [W]e could ask what were the entity items ofTigers Eye, as agent. It would seem to make no difference whether we address the agency as a hypothetical entity, acting through Tigers Eye, or address Tigers Eye as an entity in its own

CDP hearing the Secretary has authority to compromise any civil case arising under the internal revenue laws on three grounds: (1) doubt as to liability, (2) doubt as to collectibility, and (3) promotion ofeffective tax administration. Sec. 7122(a); sec. 301.7122-1(b), Proced. & Admin. Regs. Where the merits ofthe underlying liability were at issue in the CDP hearing, the Court will review the matter de novo. Davis v. Commissioner, 115 T.C. 35, 39 (2000). A taxpayermay challenge the existence or

301.6330-1(b)(2), Q&A- B2, B4, Proced. & Admin. Regs. ("The taxpayer must request the CDP hearing within 30 days ofthe date ofthe first CDP Notice provided for that tax and tax period."). Petitioners have not disputed respondent's determination in this regard. - 10 - On September 9, 2011, petitioners submitted a request for a partial payment

301.6330-1(b)(2), Proced. & Admin. Regs. (Though note that there can be separate hearings to review proposed collection by lien. Secs. 6320(b)(2), 6330(b)(2); see also Freije v. Commissioner, 131 T.C. 1, 4 (2008), a_[d, 325 F. App'x 448 (7th Cir. 2009).) - 5 - levies. Secs. 6320(c), 6330(d)(1). They do not, however, specify a standard of revi

1); Hoyle v. Commissioner, 131 T.C. 197, 200, 203-204 (2008), supplemented by 136 T.C. 463 (2011). A taxpayer's last known address is generally the address appearing on - 7 - [*7] his "most recently filed and properly processed Federal tax return." Sec. 301.6212-2(a), Proced. & Admin Regs. Even ifimproperly addressed, a notice of deficiency is valid ifit is actually received by the taxpayer in time to file a petition to this Court. See Bongam v. Commissioner, 146 T.C. 52, 56-57 (2016). Petitione

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.6231(a)(1)-1(a)(2), Proced. & Admin Regs. A passthrough partner is a partnership, estate, trust, S corporation, nominee, or other similar person through whom other persons hold an interest in the partnership and includes disregarded entities such as single-member LLCs. See sec. 6231(a)(9); 6611, Ltd. v. Commissioner, T.C. Memo. 2013-49; Ti

tions to tax. Because petitioner submitted none of these documents, he did not properly challenge his underlying tax liabilities. See Lunnon v. Commissioner, T.C. Memo. 2015-156, 110 T.C.M. (CCH) 182, 185, a_f[d, 652 F. App'x 623 (10th Cir. 2016); sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin Regs. Since petitioner's underlying liabilities for 2009-2011 are thus not before us, we will review the SO's determination for abuse ofdiscretion only. See, e.g., Pough v. Commissioner, 135 T.C. 344, 349-

301.7430-7(c)(7), Proced. & Admin. Regs. - 17 - [*17] petitioner is the prevailing party for purposes ofan award ofcosts. However, petitioner made a qualified offer within the meaning ofsection 7430(c)(4)(E) on April 30, 2009; that is, at a time when he would not otherwise be treated as a prevailing party under section 7430(c)(4)(A) and (B).

tem." A "partnership item" means an "item required to be taken into account for the partnership's taxable year" that the Secretary has determined "is more appropriately determined at the partnership level than at the partner level." Sec. 6231(a)(3); sec. 301.6231(a)(3)- 1, Proced. & Admin. Regs. Neither party contends that respondent's proposed adjustments should be determined at the partner level, and we reach the same conclusion. We accordingly havejurisdiction to review the FPAAs at issue. B.

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.7701-3(b), Proced. & Admin. Regs. For the sake ofcompleteness we briefly consider whether the four partnerships are shams for Federal tax purposes and should be disregarded. Respondent argues that the partnerships were organized for tax-avoidance purposes. We agree. "A partnership is generally said to be created when personsjoin together t

301.6231(a)(1)-1(b)(2), Proced. & Admin. Regs. (a small partnership may elect to apply TEFRA by filing an attachment to its return). On its December 31, 2001 tax return, Lincoln Partners answered "yes" on line 4 ofSchedule B to the question ofwhether it was subject to TEFRA and named a tax matters partner. - 9 - [*9] During Lincoln's December

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

301.6330-1(d)(2), Q&A-D6, Proced. & Admin. Regs.; see also Davis v. Commissioner, 115 T.C. 35, 41 (2000). - 6 - [*6] Petitioner contends that it is a single-member LLC, and not a partnership, and therefore was not required to file a partnership return. Section 6031 requires every partnership as defined in section 761(a) to file a tax return f

301.6212-2(a), Proced. & Admin. Regs. Change ofaddress information provided by the taxpayer to a third party does not constitute clear and concise notification ofa different address (even ifthe third party files information returns with the IRS that reflect that change). Id. para. (b)(1); see, e.g., Blocker v. Commissioner, T.C. Memo. 2005-279

received petitioner's hearing request on September 20, 2016, and assigned it to a settlement officer (SO). Upon receiving the case the SO concluded that petitioner's hearing request was untimely and therefore offered him an "equivalent hearing." See sec. 301.6320-1(i)(1), Proced. & Admin. Regs. The SO reviewed the administrative file and confirmed that petitioner's tax liabilities for the years in question had been properly assessed and that the IRS had met all other requirements ofapplicable la

301.6231(a)(3)- 1(a)(1)(i), Proced. & Admin. Regs.; see sec. 6231. Therefore, we havejurisdiction over the issue presented in this case. - 9 - [*9] asset is "property held by the taxpayer (whether or not connected with his trade or business)" but excludes, among other things, "inventory" and "property held by the taxpayerprimarily for sale to

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

301.6611-1(h)(2), Proposed Proced. & Admin. Regs., 49 Fed. Reg. 39570 (Oct. 9, 1984). But section 6611(g)(2)(B)(ii) also says that missing information affects the processibility ofa return only ifits absence prevents "the mathematical verification ofthe tax liability as shown on the return." This means that a return can be valid even ifit does

not now challenge his underlying tax liability for 2009, 2010, or 2012 because he received a notice ofdeficiency for each ofthose years, two of which he litigated in this Court. See sec. 6330(c)(2)(B); Sego v. Commissioner, 114 T.C. 604, 609 (2000); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. - 8 - [*8] need for the efficient collection oftaxes with the legitimate concern of* * * [petitioner] that any collection action be no more intrusive than necessary." h sec. 6330(c)(3). Our review

301.6611-1(h)(2), Proposed Proced. & Admin. Regs., 49 Fed. Reg. 39570 (Oct. 9, 1984). But section 6611(g)(2)(B)(ii) also says that missing information affects the processibility ofa return only ifits absence prevents "the mathematical verification ofthe tax liability as shown on the return." This means that a return can be valid even ifit does

143 T.C. 83, 95 (2014) (stat- ing that the Commissioner's failure to adhere to the 120-day timeframe means that the NBAP is untimely but does not invalidate either notice); Wind Energy Tech. Assocs. III v. Commissioner, 94 T.C. 787, 791-794 (1990); sec. 301.6223(e)-2(a), Proced. & Admin. Regs. Thus, any failure by the IRS to issue timely NBAPs to the notice partners did not prevent it from issuing a valid FPAA to PMG and BSC Leasing, Inc., the partnership's TMP.¹³ The IRS issued to PMG and its

nvolvement is - 12 - [*12] defined as "participation or involvement in a matter (other than a CDP hearing held under either section 6320 or section 6330) that the taxpayermay have had with respect to the tax and tax period shown on the CDP Notice." Sec. 301.6330-1(d)(2), A-D4, Proced. & Admin. Regs. There is no evidence that Ms. Warren had any involvement in any matter relating to petitioner except for the CDP hearing. Accordingly, Ms. Warren's involvement did not violate section 6330(b)(3). Pet

attachments must purport to be a 'return'." Rader v. Commissioner, 143 T.C. 376, 382 (2014) (quoting Spurlock v. Commissioner, T.C. Memo. 2003-124, slip op. at 27), aff'd in part, appeal dismissed in part, 616 F. App'x 391 (10th Cir. 2015); see also sec. 301.6020-1(b)(2), Proced. & Admin. Regs. The 2012 SFR consisted ofa Form 13496, IRC Section 6020(b) Certification; a Form 4549, Income Tax Examination Changes; and a Form 886-A, Explanations ofItems. This combination ofdocuments is sufficient to

the estate ofa deceased partner. Sec. 6231(a)(1)(B)(i). To make an election, a small partnership must attach a statement electing to be under TEFRA to its tax return for the first year it wants the election to go into effect. Sec. 6231(a)(1)(B)(ii); sec. 301.6231(a)(1)-1T(b)(2), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6790 (Mar. 5, 1987). The statement must say it's an election under section 6231(a)(1)(B)(ii), and it must be signed by everyone who was a partner during that tax year. Sec.

e Court received petitioner's petition on August 17, 2015. The envelope in which it was mailed bore a postmark dated August 11, 2015, and a U.S. Postal Service mark dated August 12, 2015, so the petition is treated as timely filed. See sec. 7502(a); sec. 301.7502-1(c)(1)(iii), Proced. & Admin. Regs. VIII. Respondent's Motion for Summary Judgment On August 24, 2016, respondent filed a motion for summaryjudgment and later amended that motion. The Court held a hearing in this case on October 24, -

301.7623-3, Proced. & Admin. Regs., 79 Fed. Reg. 47270 (Aug. 12, 2014); Internal Revenue Manual (IRM) pt. 25.2.2.9 (Aug. 7, 2015); IRM pt. 25.2.2.11 (June 18, 2010). - 9 - associated with certified mail." Respondent also averred that the relevant statute (i.e., section 7623) dictates neither the contents ofthe written whistleblower award dete

rdinary business care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside the taxpayer's control. See McMahan v. Commissioner, 114 F.3d 366, 369 (2d Cir. 1997), § T.C. Memo. 1995-547; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Section 6651(a)(2) imposes an addition to tax for failure timely to pay the amount shown as tax on a return unless the failure was due to reasonable cause and not willful neglect. A substitute for return

Section 6061(a) provides the general rule that "any return, statement, or other document required to be made under any provision ofthe internal revenue laws or regulations shall be signed in accordance with the forms or regulations prescribed by the Secretary." Section 301.6061-1(b), Proced.

ting ofhis intention to make the levy at least 30 days before any levy action is begun. Section 6330 elaborates on section 6331 and provides that the written notice must inform the taxpayer of her right to request a CDP hearing. Sec. 6330(a)(3)(B); sec. 301.6330-1(b)(1), Proced. & Admin. Regs." Ifa CDP hearing is requested, the hearing is to be conducted by the Appeals Office. Sec. 6330(b)(1). At the hearing the SO conducting it must verify that the requirements ofany applicable law or administr

301.6651-1(c)(1), Proced. & Admin. Regs. This determination is factual, and the burden ofproofis on the taxpayer. Merriam v. Commissioner, T.C. Memo. 1995- 432, 1995 WL 522813, at *11, aff'd without published opinion, 107 F.3d 877 (9th Cir. 1997). "Undue hardship" must be more than an "inconvenience" to the 18 taxpayer; it requires that he ha

301.7701-3(a) and (b)(1)(i), Proced. & Admin. Regs. There is no evidence in the record that RMSC elected to be treated as a corporation, and both parties refer to RMSC as a partnership for tax purposes. Therefore, we will treat RMSC as a partnership for tax purposes. A partnership is not subject to Federal income tax at the partnership level;

ant issue relating to the unpaid tax or the proposed collection method. Sec. 6330(c)(2)(A). Generally, a taxpayermust raise an issue at a CDP hearing to preserve it for this Court's consideration. Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The merits are not properly raised ifthe taxpayer challenges the underlying tax liability but fails to present Appeals with any evidence regarding that liability after being given a reasonable oppo

c. 4(...continued) Court. She is thus precluded from challenging it here. See Thompson v. Com- missioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 7 - [*7] 6330(c)(2) and (3). In her hearing request petitioner indicated her intention to seek a collection alternative in the form ofan installment agreement (IA). Section 6159(a) authorizes the

24(a)(2), 6901(a)(1)(A)(ii), (h). Moreover, a lien for estate tax attaches at the date ofthe decedent's death to every part ofthe gross estate whether or not the property comes into the possession ofan executor or administrator. See sec. 6324(a)(1); sec. 301.6324-1(a)(1), Proced. & Admin. Regs. A principal aspect ofpetitioner's complaint with respect to the determination is that "[t]he Commissioner abused his discretion by failing to file a lien against the non-probate assets". Apparently, petit

section 301.6651-1(c), Proced. & Admin. Regs., provides: Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause. A failure to pay will be considered to be due to reasonable cause to the extent that the taxpayerhas made a sati

That regulation generally provides that an individual suffers economic hardship ifthe individual is unable to pay his or her reasonable basic living expenses.

301.6651-1(c)(1), Proced. & Admin. Regs. Reasonable cause exists for purposes ofsection 6651(a)(2) ifthe taxpayermakes a satisfactory showing that she exercised ordinary care and prudence in providing for payment ofher tax liability - 18 - [*18] but nevertheless either was unable to pay the tax timely or would suffer undue hardship ifthe paym

301.7623-3(c)(2), Proced. & Admin. Regs. In either event the Office informed petitioner that "[a]ny comments that we receive will be considered in making the final determination." The letter emphasized: "This letter is NOT a final determination for purposes offiling a petition with the United States Tax Court." On December 8 and 9, 2014, petit

arked at the same point oforigin by the U.S. Postal Service on the * * * last day ofthe period, prescribed for filing the * * * [petition]." R moved to dismiss the case for lack ofjurisdiction. H_eld: P's petition does not satisfy the requirements ofsec. 301.7502-1(c)(1)(iii)(B)(2), Proced. & Admin. Regs., and we must dismiss this case for lackjurisdiction. SERVED Mar 16 2017 - 2 - [*2] Dale Grimm, pro se. Evan K. Like, for respondent. MEMORANDUM OPINION WHERRY, Judge: This case was filed in res

t Cir. 2006). A taxpayer may challenge the existence or amount ofunderlying liability in a CDP proceeding only ifthe taxpayer received no notice ofdeficiency and otherwise had no opportunityto contest the liability. See secs. 6320(c), 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. In any event, a taxpayer's underlying liability is not properly subject tojudicial review pursuant to section 6320(c) or section 6330(d)(1) ifthe issue was not properly raised in the CDP hearing.

in an incorrect address being used on a notice to her of taxes owed pursuant to the substitute for return. The actual substitute for return was not sent to petitioner, and she appears to have been unaware ofthe possible identity theft. Sec. 6020 and sec. 301.6020-1, Proced. & Admin. Regs., do not require respondent to provide the substitute for return, and we find that the fact that respondent used the wrong address for the earlier notice does not affect our jurisdiction or the outcome ofthis ca

301.6651-1(c), Proced. & Admin. Regs. Petitioner told the revenue agent that her 2008 return was late because ofthe death ofher father in 2009, but petitioner's father died on April, 3, 2008. Petitioner is therefore liable for the additions to tax under section 6651(a)(1) for tax years 2008-10. We have considered the other arguments ofthe part

301.6343-1(b)(4), Proced. & Admin. Regs. In addition, the Commissioner considers the requesting spouse's current income (including how the requesting spouse's income compares to Federal poverty guidelines) and assets in relation to her expenses. Rev. Proc. 2013-34, sec. 4.03(2)(b). This factor weighs in favor ofequitable reliefwhen the request

t Cir. 2006). A taxpayer may challenge the existence or amount ofunderlying liability in a CDP proceeding only ifthe taxpayer received no notice ofdeficiency and otherwise had no opportunityto contest the liability. See secs. 6320(c), 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. In any event, a taxpayer's underlying liability is not properly subject tojudicial review pursuant to section 6320(c) or section 6330(d)(1) ifthe issue was not properly raised in the CDP hearing.

These regulations (titled "Procedure in the case of transferred assets") currently appear in virtually the same form as section 301.6901-1(a) through (f), Proced.

301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs.; see also Rebuck v. Commissioner, T.C. Memo. 2016-3; Kuretski v. Commissioner, T.C. Memo. 2012-262, af[d, 755 F.3d 929 (D.C. Cir. 2014). The type ofagreement that petitioner proposed, and that the SO was willing to accept, was a PPIA. The Commissioner has created guidelines, set out in the IRM,

at 401, that "an economic hardship exists ifsatisfaction ofthe tax liability in whole or in part will cause the requesting spouse to be unable to pay reasonable basic living expenses." A determination as to whether a requesting spouse will suffer economic hardship is based on rules similar to those in section 301.6343- 1(b)(4), Proced.

at 401, states that an economic hardship "exists ifsatisfaction ofthe tax liability in whole or in part will cause the requesting spouse to be unable to pay reasonable basic living expenses." A determination whether a requesting spouse will suffer economic hardship is based on rules similar to those in section 301.6343-1(b)(4), Proced.

provision ofTenn. Code Ann. sec. 66-3-306. II. Transferee Liability Under Section 6901 For purposes ofsection 6901, the term "transferee" includes a donee, heir, legatee, devisee, distributee, or shareholder ofa dissolved corporation. Sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principles ofsubstance over form discussed above apply to determinations oftransferee liability under Federal tax law. The MidCoast transaction served no business purpose other than to avoid tax and to d

ssue not raised in the assign- ments oferror shall be deemed to be conceded."); Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 7 - [*7] C. Analysis The only question is whether the IRS properly sustained an NFTL filing to collect petitioner's unpaid tax liabilities. We review the record to determine whether the SO: (1) p

Qualification for a -8- [*8] whistleblower award under section 7623(b) is limited in relevant part, however, by section 7623(b)(5)(B), which provides that subsection (b) shall apply with respect to "any action--ifthe tax, penalties, interest, additions to tax, and additional amounts in dispute exceed $2,000,000."7 Section 301.7623-2(e)(2), Proced.

tion from which to compute the taxpayer's tax liability, and the return form and any attachments must purport to be a 'return'." Rader v. Commissioner, 143 T.C. at 382 (quoting Spurlock v. Commissioner, T.C. Memo. 2003-124, slip op. at 27); see also sec. 301.6020- 1(b)(2), Proced. & Admin. Regs. The 2010 SFR consisted ofa Form 13496, IRC Section 6020(b) Certification; a Form 4549, Income Tax Examination Changes; and a Form 886-A, Explanations ofItems. Contrary to what petitioner may - 8 - [*8] b

In sum, section 6330(f)(2) provides that the Secretary may proceed with such a levy but is obliged to provide the taxpayerwith notice ofthe right to, and the opportunity for, an administrative hearing within a reasonable time after the levy.

- 6 - The reference to "Example 2" in the analyst's statement refers to Example 2 in section 301.7623-2(b), Proced.

609 (2000). But this Court considers a taxpayer's challenge to his underlying liability in a collection action case only if he properly raised that challenge at the administrative hearing. Giamelli v. Commissioner, 129 T.C. 107, 114-115 (2007); see sec. 301.6330-1(f)(2), Q&A- F3, Proced. & Admin. Regs. An issue is not properly raised at the administrative - 7 - [*7] hearing ifthe taxpayer fails to request consideration ofthat issue by the settlement officer or ifhe requests consideration but fa

301, 302, or 303 operates as a stay, applicable to all entities, ofthe commencement or continuation ofa proceeding before this Court concerning the tax liability ofa debtor who is an individual for a taxable period ending before the date ofthe bankruptcy order ofrelief. - 5 - [*5] prepared on the basis ofthe stipulation. The parties failed to

nts to file an amended return does not have to mail it to the IRS. He can hand carry it and turn it in to "any person assigned the responsibilityto receive hand-carried returns in the local Internal Revenue Service office." R para. (d)(1); see also sec. 301.6091-1(c), Proced. & Admin. Regs. (defining "hand carried"). It is undisputed that Smyth's son and his wife prepared an amended 2012 return. Smyth claims that they "filed" this amended return when a copy was delivered by their return preparer

301, 302, or 303 operates as a stay, applicable to all entities, ofthe commencement or continuation ofa proceeding before this Court concerning the tax liability ofa debtor who is an individual for a taxable period ending before the date ofthe bankruptcy order ofrelief. - 5 - [*5] prepared on the basis ofthe stipulation. The parties failed to

respect to a partnership, any item required to be taken into account for the partnership's taxable year under any provision ofsubtitle A [sections 1-1563] to the extent regulations prescribed by the Secretary provide that, for purposes ofthis subtitle, such item is more appropriately determined at the partnership level than at the partner level." Section 301.6231(a)(3)-1(a)(1)(i), Proced.

in's guaranteed payments as "gross receipts" on their Schedule C; that is, without netting out their claimed section 911 exclusion. Instead, Mr. Larkin's guaranteed payments from SSD are, generally speaking, "partnership items". See sec. 6231(a)(3); sec. 301.6231(a)(3)-1(a)(2), Proced. & Admin. Regs. Consequently, petitioners were, generally speaking, required either to treat the guaranteed payments on their returns for the subject years consistently with the SSD partnership returns or to file s

301.6231(a)(3)- 1(a)(1)(i), Proced. & Admin. Regs. - 12 - [*12] (4) conduct a partnership proceeding. Sec. 6227(d). Ifthe Secretary ultimately disallows an AAR filed pursuant to section 6227(d), depending on the action taken by the Secretary, the partner may file a refund claim or initiate a civil action for refund pursuant to section 7422. S

d to the IRS in response to the notice ofintent to levy that he had received with respect to his taxable year 2006 and in which he requested a hearing with the Appeals Office. The 10-year period oflimitations prescribed by sec. 6502(a) was, and remains, suspended as ofthe date on which the IRS received petitioner's Form 12153. See sec. 6330(e)(1); sec. 301.6330-1(g)(2), Q&A-G1, Proced. & Admin. Regs.

nable error or delay by an officer or employee ofthe [IRS] * * * in performing a ministerial or managerial act." A managerial act is "an administrative act * * * involving the temporary or perma- nent loss ofrecords or * * * management ofpersonnel." Sec. 301.6404-2(b)(1), Proced. & Admin. Regs. A ministerial act is a "procedural or mechanical act that does not involve the exercise ofjudgment or discretion." R subpara. (2). Actions relevant to "decision concerning the proper application offederal

at 114, provided: "In the case ofajoint return * * * the combined normal tax and surtax * * * shall be twice the combined normal tax and surtax that would be determined ifthe net income * * * were - 21 - reduced by one-half."" But this change caused some confusion: Whereas before 1948 it had often produced a better result (and a

Section 301.7502-1(c)(1), Proced. & Admin. Regs., requires that the document: (1) be contained in a properly addressed envelope; (2) be deposited within the prescribed time in the mail in the United States with sufficient postage prepaid; and (3) bear a postmark. In the case ofregistered or certified mail, the date ofregistration or the date ofthe

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. On the basis ofthis record, petitioner did not assert at any point during the CDP hearing that the IRS erred in determining that he had overstated his withholding credit for 2009, nor did he provide SO Masters with documentation or evidence to support such an assertion.¹° Therefore, he did not p

301.7701-3(g)(1)(ii), Proced. & Admin. Regs. In calculating Mr. Tucker's basis in his Sligo stock, petitioners increased Mr. Tucker's basis by the $51 million premium paid for the long yen put option and $2,024,700 in purported cash contributions. However, Mr. Tucker did -23- [*23] not decrease his Sligo stock basis by the premium received fo

301.7701-3(a), Proced. & Admin. Regs. Because NMT cannot be classified as a partnership for Federal tax purposes, "there was no partnership loss, and there were no partnership deductions, no contributions to the purported partnership, and no distributions from a partnership to its purported partners. Adjustment ofthose [partnership] items to z

t to such liabilities, the regulations provide that "[a]n opportunity to dispute the underlying liability includes a prior opportunity - 7 - [*7] for a conference with Appeals that was offered either before or after the assessment ofthe liability." Sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs.2 Petitioner had a prior opportunityto dispute his employment tax liabilities with the IRS Appeals Office, and he took advantage ofthat opportunityby filing a written protest in June 2013. He partic

01). To show reasonable cause, taxpayers must demonstrate that they exercised ordinary business care and prudence but nevertheless were unable to file their income tax returns by their due dates. See United States v. Boyle, 469 U.S. 241, 246 (1985); sec. 301.6651-1(c), Proced. & Admin. Regs. Willful neglect is defined as a "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. Respondent has met his burden because petitioner filed her 2011 return late. Petitioner, who

301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see also Giamelli v. Commissioner, 129 T.C. 107, 115 (2007). This Court held in McNeill I, 148 T.C. at __ (slip op. at 14), that it hasjurisdiction to review respondent's determination as it relates to the asserted section 6662(a) penalty. The Court will accordingly review de novo the IRS deter

301.6651-1(c)(1), Proced. & Admin. Regs. This determination is factual, and the burden ofproofis on the taxpayer. Merriam v. Commissioner, T.C. Memo. 1995-432, 1995 WL 522813, at *11, aff'd without published opinion, 107 F.3d 877 (9th Cir. 1997). Petitioner did not provide evidence that his failure to timely file was due to reasonable cause. A

also Montgomeryv. Commissioner, 122 T.C. 1, 9-10 (2004). The Court will consider an underlying tax liability on review only ifthe taxpayerproperly raised the issue during the CDP hearing. Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); see also sec. 301.6330- - 11 - [*11] 1(f)(2), Q&A-F3, Proced. & Admin. Regs. A taxpayer did not properly raise an underlying liability ifhe did not present the SO with any evidence regarding the liability after being given a reasonable time. See sec. 301.6330

determination. See sec. 6330(d)(1). The Court received petitioner's petition on September 30, 2013. Because the envelope in which it was mailed bore a USPS postmark dated September 25, 2013, the petition is treated as timely filed. See sec. 7502(a); sec. 301.7502-1(c)(1), Proced. & Admin. Regs. VI. Remand to the IRS Office ofAppeals On August 19, 2015, respondent moved to remand this case to the Office of Appeals to allow the SO to supplement the administrative file to verify that the notice ofd

301.7430-5(c)(1), Proced. & Admin. Regs. The Commissioner is entitled to maintain his position, for purposes of determining whether it was substantiallyjustified, until adequate substantiation is received from the taxpayer. See Baldwin v. Commissioner, T.C. Memo. 2015-66, at *l l. Further, where the resolution ofdisputed adjustments hinges on

at 639; see also Power v.

provision ofTenn. Code Ann. sec. 66-3-306. II. Transferee Liability Under Section 6901 For purposes ofsection 6901, the term "transferee" includes a donee, heir, legatee, devisee, distributee, or shareholder ofa dissolved corporation. Sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principles ofsubstance over form discussed above apply to determinations oftransferee liability under Federal tax law. The MidCoast transaction served no business purpose other than to avoid tax and to d

Postal Service postmark dated November 6, 2012, which under section 301.7502-1(c)(2), Proced.

The determination ofwhether a spouse will suffer economic hardship is based on rules similar to section 301.6343-1(b)(4), Proced.

such failure was due to reasonable cause and not willful neglect. "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651- 1(c)(1), Proced. & Admin. Regs. Absent reasonable cause, the addition to tax is calculated at 5% ofthe amount required to be shown as tax on the untimely return, multiplied by the number ofmonths during which the failure to file contin

114 T.C. 604, 609 (2000). This Court considers a taxpayer's challenge to her underlying liability in a collection action case only ifshe properly raised that challenge at her CDP hearing. See Giamelli v. Commissioner, 129 T.C. 107, 115- 116 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. An issue is not properly raised at the CDP hearing ifthe taxpayer fails to request consideration ofthat issue by Appeals or ifshe requests consideration but fails to present any evidence after bei

in's guaranteed payments as "gross receipts" on their Schedule C; that is, without netting out their claimed section 911 exclusion. Instead, Mr. Larkin's guaranteed payments from SSD are, generally speaking, "partnership items". See sec. 6231(a)(3); sec. 301.6231(a)(3)-1(a)(2), Proced. & Admin. Regs. Consequently, petitioners were, generally speaking, required either to treat the guaranteed payments on their returns for the subject years consistently with the SSD partnership returns or to file s

301.6212-2(a), Proced. & 2When a case is remanded to the IRS Appeals Office and a supplemental determination is issued, the position ofthe IRS that we review is the position taken in the last supplemental determination. h, Kelby v. Commissioner, 130 T.C. 79, 86 (2008). - 8 - [*8] Admin. Regs.; see King v. Commissioner, 857 F.2d 676, 679-680 (

301.6231(a)(7)-1(b), Proced. & Admin. Regs. So KP1 replaced Bolton Capital as the TMP on March 26, 2004. And the Commissioner mailed the FPAAs to KP1 because it was BCP's tax matters partner at the time. - 32 - [*32] "solely for purposes oftax avoidance by artificially overstating basis in the partnership interest ofits purported partners" an

y issue not raised in the assignments oferror shall be deemed to be conceded."); Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 8 - [*8] issues petitioners raised; and (3) considered "whether any proposed collection action balances the need for the efficient collection oftaxes with the legitimate concern of* * * [petitio

301.6231(a)(3)- 1(a)(1)(i), Proced. & Admin. Regs. - 12 - [*12] (4) conduct a partnership proceeding. Sec. 6227(d). Ifthe Secretary ultimately disallows an AAR filed pursuant to section 6227(d), depending on the action taken by the Secretary, the partner may file a refund claim or initiate a civil action for refund pursuant to section 7422. S

t Cir. 2006). A taxpayer may challenge the existence or amount ofunderlying liability in a CDP proceeding only ifthe taxpayer received no notice ofdeficiency and otherwise had no opportunityto contest the liability. See secs. 6320(c), 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. In any event, a taxpayer's underlying liability is not properly subject tojudicial review pursuant to section 6320(c) or section 6330(d)(1) ifthe issue was not properly raised in the CDP hearing.

such failure was due to reasonable cause and not willful neglect. "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651- 1(c)(1), Proced. & Admin. Regs. Absent reasonable cause, the addition to tax is calculated at 5% ofthe amount required to be shown as tax on the untimely return, multiplied by the number ofmonths during which the failure to file contin

301.6651-1(c)(1), Proced. & Admin. Regs. The obligation to file timely is the taxpayer's, unambiguous and nondelegable, and reliance on an agent generally will not amount to reasonable cause for untimely filing. United States v. Boyle, 469 U.S. 241, 249-252 (1985). Taxpayers bear a heavy burden when attempting to prove reasonable cause for fai

301.6231(a)(3)- 1(a)(1)(i), Proced. & Admin. Regs. - 12 - [*12] (4) conduct a partnership proceeding. Sec. 6227(d). Ifthe Secretary ultimately disallows an AAR filed pursuant to section 6227(d), depending on the action taken by the Secretary, the partner may file a refund claim or initiate a civil action for refund pursuant to section 7422. S

reasonable cause and not due to willful neglect." Sec. 6651(a)(1). "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651-1(c), Proced. & Admin. Regs.; see Crocker v. Commissioner, 92 T.C. 899, 913 (1989). Circumstances that may con- stitute "reasonable cause" include (among other things) unavoidable postal delays, the timely filing ofa return with the wro

ofa deficiency turns not on what payments have been applied to an account, but rather on what assessments have been made with respect to that account. Longino v. Commissioner, T.C. Memo. 2013-80, at *70-*71, M, 593 F. App'x 965 (11th Cir. 2014); see sec. 301.6211-1(b), Proced. & Admin. Regs. ("Payments on account ofestimated income tax, like other payments oftax by the taxpayer, shall likewise be disregarded in the determination ofa deficiency."); see also Burke v. Commissioner, T.C. Memo. 2009-

301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. (stating that receipt ofa notice ofdeficiency for purposes ofsection 6330(c)(2)(B) "means receipt in time to petition the Tax Court for a redetermination ofthe deficiency"). III. Abuse ofDiscretion In deciding whether the SO abused his discretion in sustaining the proposed collection action, we

eless was unable to file within the prescribed time. Boyle, 469 U.S. at 246. -16- [*16] Similar rules apply with respect to the civil penalties imposed under section 6679 for failure to file information required under section 6046. Sec. 6679(a)(1); sec. 301.6679-1(a), Proced. & Admin. Regs. Ifa taxpayerexercises ordinary business care and prudence and is nevertheless unable to obtain and provide the required information, a failure to file will be considered to be due to reasonable cause. Sec. 30

provision ofTenn. Code Ann. sec. 66-3-306. II. Transferee Liability Under Section 6901 For purposes ofsection 6901, the term "transferee" includes a donee, heir, legatee, devisee, distributee, or shareholder ofa dissolved corporation. Sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principles ofsubstance over form discussed above apply to determinations oftransferee liability under Federal tax law. The MidCoast transaction served no business purpose other than to avoid tax and to d

erly raised ifthe taxpayer raises the -14- [*14] underlying liability but fails to present Appeals with any evidence regarding the liability after being given reasonable opportunityto do so. h, Anderson v. Commissioner, T.C. Memo. 2016-211, at *19; sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. II. Tax Year 2003 In the argument section oftheir brief, petitioners state that certain facts are undisputed: (1) that respondent sent them a statutory notice ofdeficiency for tax year 2003; (2) th

301, 302, or 303 operates as a stay, applicable to all entities, ofthe commencement or continuation ofa proceeding before this Court concerning the tax liability ofa debtor who is an individual for a taxable period ending before the date ofthe bankruptcy order ofrelief. - 5 - [*5] prepared on the basis ofthe stipulation. The parties failed to

s provided in the regulations, "[t]axpayers will be expected to provide all relevant information requested by * * * [the Appeals officer], including financial statements, for * * * [her] consideration ofthe facts and issues involved in the hearing." Sec. 301.6330-1(e)(1), Proced. & Admin. Regs. On his CDP hearing request petitioner checked the box marked "I Cannot Pay Balance." Before the CDP hearing the SO asked petitionerto submit (among other things) a completed Form 433-A and signed tax retu

only the prescribed forms, Form 866, Agreement as to Final Determination ofTax Liability, and Form 906, Closing Agreement on Final Determination Covering Specific Matters, qualify as closing agreements. Sec. 601.202(b), Statement ofProcedural Rules; sec. 301.7212-1(d)(1), Proced. & Admin. Regs. In extraordinarilyrare cases, courts have bound the Commissioner to an agreement in the absence ofa properly executed Form 866 or Form 906. In Treaty Pines Inys. P'ship v. Commissioner, 967 F.2d 206, 211

A determination whether a requesting spouse will suffer economic hardship is based on rules similar to those in section 301.6343-1(b)(4), Proced.

301.6320- 1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see Giamelli v. Commissioner, 129 T.C. 107, 115 (2007). A taxpayerduring a CDP hearing does not properly raise an issue, including an issue concerning its underlying tax liability, ifit "fails to pre- sent to Appeals any evidence with respect to that issue after being given a reason- able oppo

issue not raised in the assign- ments oferror shall be deemed to be conceded."); Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Petitioner likewise did not allege during the CDP hearing, in her petition, or in her response to the motion for summaryjudg- ment that the TFRPs, which are assessable penalties, were not "persona

he appropriateness ofa proposed levy on the grounds that the levy would create economic hardship because ofthe financial condition ofP. R's settlement officer (SO) did not consider P's economic hardship argument because P is a corporate taxpayerand sec. 301.6343- 1(b)(4)(i), Proced. & Admin. Regs., limits economic hardship reliefto individual taxpayers. P asserts in a motion for summaryjudgment that sec. 301.6343- 1(b)(4)(i), Proced. & Admin. Regs., is invalid because it conflicts with I.R.C. se

301.6330-1(d)(2), Q&A-D7, Proced. & Admin. Regs. Petitioner did not provide any ofthe requested tax returns or financial information or contact the Appeals officer. Because ofpetitioner's failure to provide the requested information, the Appeals officer, as petitioner was forewarned in respondent's December 2015 letter, conducted petitioner's

301.7122-1(b), Proced. & Admin. Regs. Doubt as to collectibility exists in any case where the taxpayer's assets and income are less than the full amount ofthe liability. E subpara (2). Generally, an OIC will be accepted ifit is unlikely that the tax can be collected in full and the OIC reasonably reflects the amount the IRS could collect throu

301.7122- 1(b), Proced. & Admin. Regs. "Doubt as to collectibility exists in any case where the taxpayer's assets and income are less than the full amount ofthe liability." Id. subpara. (2). However, the decision to accept or reject an offer-in-compromise is left to the Secretary's discretion. Id. para. (c)(1). "The determination whether to -

ortunity to challenge the additions to tax, - 13 - and properly raised the issue ofthe underlying tax liabilities during the CDP hearing. See sec. 6330(c)(2)(B); Sego v. Commissioner, 114 T.C. 604, 610 (2000); Goza v. Commissioner, 114 T.C. at 182; sec. 301.6320-1(e)(3), Q&A-E2, Proced. & Admin. Regs. The Court has jurisdiction to consider a taxpayer's tax liabilities for years that are not the subject ofa notice ofdetermination insofar as they are relevant to computing his tax liability for the

, 2015, more than two months after the mailing ofthe notice ofdeficiency on June 19, 2015. 3The filing ofa return reporting an overpayment generally constitutes the filing ofa claim for refund. McGregor v. United States, 225 Ct. Cl. 566, 566 (1980); sec. 301.6402-3(a)(1), Proced. & Admin. Regs. But the converse is not true for the deemed claim for refund under section 6512(b)(3)(B); that deemed claim does not constitute a deemed return. Lundy, 516 U.S. at 248-250. As a result, section 6512(b)(3)

301.6320- 1(b)(2), Q&A-B3, sec. 301.6330-1(e)(3), Q&A-E8(i), Proced. & Admin. Regs. In making the determination the Appeals officer is required to take into consideration: (1) whether the requirements ofapplicable law and administrative procedure have been met; (2) any relevant issues raised by the taxpayer; and (3) whetherthe - 10 - [*10] pr

or the benefit ofthe ESOP participants was a "trust" in the ordinary sense ofthat word. The regulations describe a trust as an arrangement "wherebytrustees take title to property for the purpose ofprotecting or conserving it for the beneficiaries." Sec. 301.7701-4(a), Proced. & Admin. Regs. "Generally speaking, an arrangement will be treated as a trust * * * ifit can be shown that the purpose ofthe arrangement is 7Consistently with the plan agreement and the trust instrument, the "Sum- mary Plan

301.6231(a)(3)- 1(a)(1)(i), Proced. & Admin. Regs. - 12 - [*12] (4) conduct a partnership proceeding. Sec. 6227(d). Ifthe Secretary ultimately disallows an AAR filed pursuant to section 6227(d), depending on the action taken by the Secretary, the partner may file a refund claim or initiate a civil action for refund pursuant to section 7422. S

issue not raised in the assign- ments oferror shall be deemed to be conceded."); Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 8 - [*8] at the CDP hearing. See Hoyle v. Commissioner, 131 T.C. 197, 200-203 (2008). However, petitioner did not allege in his petition that the SO failed to satisfy the verification requiremen

t Cir. 2006). A taxpayer may challenge the existence or amount ofunderlying liability in a CDP proceeding only ifthe taxpayer received no notice ofdeficiency and otherwise had no opportunityto contest the liability. See secs. 6320(c), 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. In any event, a taxpayer's underlying liability is not properly subject tojudicial review pursuant to section 6320(c) or section 6330(d)(1) ifthe issue was not properly raised in the CDP hearing.

fdetermination that again sustained the levy notice. Discussion Petitioner had a prior opportunityto dispute his FICA taxes and thus cannot challenge the underlying liability. See sec. 6330(c)(2)(B); Baltic v. Commissioner, 129 T.C. 178, 183 (2007); sec. 301.6330-1(e)(3) Q&A-E2, Proced. 4Appeals Officer Lerner credited $11,620 to the March 31, 1996, period; $11,232 to each ofthe June 30, 1996, and March 31, 1997, periods; $13,300 to each ofthe June 30, September 30, and December 31, 1997, period

301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. (stating that an opportunity to dispute the underlying liability includes a prior opportunity for a conference with the Appeals Office that was offered either before or after the assessment ofthe liability). As we explained in Lewis v. Commissioner, 128 T.C. 48, 61 (2007), Congress structured se

provision ofTenn. Code Ann. sec. 66-3-306. II. Transferee Liability Under Section 6901 For purposes ofsection 6901, the term "transferee" includes a donee, heir, legatee, devisee, distributee, or shareholder ofa dissolved corporation. Sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principles ofsubstance over form discussed above apply to determinations oftransferee liability under Federal tax law. The MidCoast transaction served no business purpose other than to avoid tax and to d

. Ifan adjustment to an affected item is merely computational and can be made without making additional partner- level determinations, the IRS can directly assess the tax due without having to follow the usual deficiency procedures. Sec. 6230(a)(1); sec. 301.6231(a)(6)- 1(a)(2), Proced. & Admin. Regs. However, ifan adjustment to an affected item requires a partner-level factual determination, the IRS must follow deficiency - 8 - procedures. Sec. 6230(a)(2)(A)(i); sec. 301.6231(a)(6)-1(a)(3), Pro

The whistleblower argues that section 301.7623-4(b), Proced.

301.6231(a)(7)-1(b), Proced. & Admin. Regs. So KP1 replaced Bolton Capital as the TMP on March 26, 2004. And the Commissioner mailed the FPAAs to KP1 because it was BCP's tax matters partner at the time. - 32 - [*32] "solely for purposes oftax avoidance by artificially overstating basis in the partnership interest ofits purported partners" an

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The SO correctly informed petitioners that, if they wished to challenge their self-reported liabilities for 2009, 2011, 2012, and/or 2013, they needed to submit (at a minimum) amended returns for those years, set- ting forth what they believed their correct tax liabilities to be. Petitioners fil

at 845-847; see also Dixon v.

or the benefit ofthe ESOP participants was a "trust" in the ordinary sense ofthat word. The regulations describe a trust as an arrangement "wherebytrustees take title to property for the purpose ofprotecting or conserving it for the beneficiaries." Sec. 301.7701-4(a), Proced. & Admin. Regs. "Generally speaking, an arrangement will be treated as a trust * * * ifit can be shown that the purpose ofthe arrangement is 7Consistently with the plan agreement and the trust instrument, the "Sum- mary Plan

301, 302, or 303 operates as a stay, applicable to all entities, ofthe commencement or continuation ofa proceeding before this Court concerning the tax liability ofa debtor who is an individual for a taxable period ending before the date ofthe bankruptcy order ofrelief. - 5 - [*5] prepared on the basis ofthe stipulation. The parties failed to

S. at 494, and Rink v. Commissioner, 51 T.C. at 751), afd, 905 F.2d 241 (8th Cir. 1990). 26An entity formed as a State law corporation is treated as a corporation for Federal tax purposes. See Rochlani v. Commissioner, T.C. Memo. 2015-174, at *7-*8; sec. 301.7701-2(b)(3), Proced. & Admin. Regs. 27Moline Props., Inc. v. Commissioner, 319 U.S. 436, 439 (1943). - 19 - taxpayerto be "carrying on any trade or business". Mr. Beckey states that he was operating his own trade or business as an entrepren

t, additions to tax, and additional amounts that resulted from the action(s) with which the IRS proceeded based on the information provided, or the maximum total ofsuch amounts that were stated in formal positions taken by the IRS in the action(s)." Sec. 301.7623-2(e)(2)(i), Proced. & Admin. Regs. The regulations are effective on, and apply to information submitted on or after, August 12, 2014, and to claims for award under sec. 7623(b) that are open as of August 12, 2014. Id. para. (f). - 10 -

301.7430-7(a), Proced. & Admin. Regs. For all other claimed costs, the Commissioner may assert his substantialjustification defense pursuant to the general prevailing party rule ofsection 7430(c)(4). Respondent agrees that petitioner meets the net worth requirements and substantially prevailed with respect to the amount in controversy and the

Ambulances used in a trade or business are excluded from "listed property" as defined in section 280F(d)(5)(B)(i) and thus not subject to the strict substantiation rules.

efis not granted. A requesting spouse will suffer economic hardship ifpayment ofpart or all ofthe tax liability "will cause the requesting spouse to be unable to pay reasonable basic living expenses." Id. sec. 4.03(2)(b), 2013-43 I.R.B. at 401; see sec. 301.6343-1(b)(4)(i), Proced. & Admin. Regs. The determination as to what constitutes a reasonable amount for basic living expenses may vary with the circumstances ofthe individual taxpayerbut will not include the maintenance of an affluent or lux

he 2008 tax liability, she received a statutory notice ofdeficiency for 2008, and that was her opportunity to challenge the tax liability for that year. She therefore is precluded from challenging the 2008 tax liability now. See sec. 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-El l, Proced. & Admin. Regs. Even were she permitted, we would reject her challenge for the reasons stated above and in Doose (namely, she is not entitled to any refund for 2007). Abuse ofDiscretion To show an abuse ofdiscre

301.7701-2(c)(2)(iv), Proced. & Admin. Regs. The trust fund recovery penalties that the IRS proposed to assess against Mr. Lunnon with respect to the Form 941 liabilities for the periods at issue are not before the Court. 4For the remainder ofthis report we use the term "employmenttax" to refer to taxes under FICA, secs. 3101-3128, FUTA, secs.

use. See Boyle, 469 U.S. at 245. To prove reasonable cause, the taxpayermust show that he exercised ordinary business care and prudence but nevertheless could not file the return when it was due. See Crocker v. Commissioner, 92 T.C. 899, 913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Section 6656 imposes an addition to tax equal to 10% ofthe portion ofan underpayment in withholding tax that is required to be deposited ifthe failure to deposit extends more than 15 days. A taxpayermay a

As pertinent here, section 301.6330-1(e)(3), Q&A-E2, Proced.

301.6330-1(e)(3), Q&A-E8, Proced. & Admin. Regs. ("Taxpayers will be sent a dated Notice ofDetermination by cer- tified or registered mail."). Respondent does not argue that these regulations limit ourjurisdiction. See Harris v. Commissioner, 32 T.C. 1216, 1217 (1959) ("[0]ne litigant cannot write into the law limitations on thejurisdiction of

Section 301.6330- ¹Although respondent's motion for summaryjudgment refers to evidence of the mailing ofa notice ofdeficiency to petitioners, respondent does not explicitly invoke the presumption that items mailed were received by the addressee. Instead, respondent relies on petitioners' alleged admission ofreceipt. In any event, petitioners' denia

301.6330- - 7 - [*7] 1(f)(2), Q&A-F3, Proced. & Admin. Regs. An issue is not properly raised during the CDP hearing ifthe taxpayer fails to request consideration ofthe relevant issue or requests consideration but fails to present evidence after being given a reasonable opportunity to do so. See Thompson v. Commissioner, 140 T.C. 173, 178, (20

c)(2). II. Whether Diebold New York Was a Transferee Under Section 6901 For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The inquiry regarding transferee liability under section 6901 has two separate and -15- [*15] independent prongs. See Salus Mundi II, 776 F.3d at 1018-1019; Diebold Found., Inc. v. Commissioner, 736 F.3d at

tion ofdocuments. R objects principally on grounds of relevance. Held: R's claim oflack ofrelevance presents an unsettled question oflaw as to when the IRS proceeds on the basis of information provided by a whistleblower. See I.R.C. sec. 7623(b)(1); sec. 301.7623-2(b), Proced. & Admin. Regs. H_eld, further, the Court will not in the context ofthis discovery dispute decide a question oflaw; ifrespondent is interested in a pretrial ruling on matters oflaw, his proper course ofaction under our Rule

Green Gas elected to be taxed as a partnership under section 301.7701- 3, Proced.

301.6404-2(a)(2), Proced. & Admin. Regs. The Court reviews a denial ofa request to abate interest for abuse ofdiscretion. Sec. 6404(h)(1); Woodral v. Commissioner, 112 T.C. 19, 23 (1999). A denial ofa request to abate interest constitutes an abuse ofdiscretion if performed in a manner that is arbitrary, capricious, or without sound basis in la

s care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside the taxpayer's control. See McMahan v. Commissioner, 114 F.3d - 9 - [*9] 366, 369 (2d Cir. 1997), af[g T.C. Memo. 1995-547; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Petitioner was required to file a return for 2011 and failed to do so. See sec. 6012(a)(1)(A). Accordingly, respondent has carried his burden ofproducing evidence showing that the addition to tax under sec

ofaddress, a taxpayer's last known address is the address shown on the taxpayer's return that was most recently filed at the time that the notice was issued. King v. Commissioner, 857 F.2d at 681; Abeles v. Commissioner, 91 T.C. 1019, 1035 (1988); sec. 301.6212-2(a), Proced. & Admin. Regs. In deciding whetherthe Commissioner mailed a notice to a taxpayer at the taxpayer's last known address, the relevant inquiry "pertains to * * * [the Commissioner's] knowledge rather than to what may in fact b

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The IRS contends that the Ogambas are barred from contesting the amounts oftheir income-tax liabilities for 2009 and 2010 because it claims that the -13- [*13] Ogambas received the notice ofdeficiency. See sec. 6330(c)(2)(B). The notice ofdeficiency entitled the Ogambas to file a petition in th

made within 30 days ofthe day after the day that the notice was personally left at the taxpayer's dwelling or place ofbusiness, or sent by certified or registered mail, return receipt requested, to the taxpayer's last known address. Sec. 6330(a)(2); sec. 301.6330-1(c)(2), Q&A-C3, Proced. & Admin. Regs.; see also Andre v. Commissioner, 127 T.C. 68, 70 (2006). Respondent argues that Mr. Yasgur had a prior opportunity to dispute his underlying tax liability because he could have requested a hearing

301.6651-1(c)(1), Proced. & Admin. Regs. This determination is factual, and the burden ofproofis on the taxpayer. Merriam v. Commissioner, T.C. Memo. 1995-432, 1995 WL 522813, at *11, aff'd without published opinion, 107 F.3d 877 (9th Cir. 1997). Reasonable cause has been found not to exist when the taxpayer claims the failure to file or pay t

6404(h); see also Lee v.

nce or amount ofthe underlying tax liability in a collection due process hearing "ifthe person did not receive any statutory notice ofdeficiency for such tax liability or did not otherwise have an opportunity to dispute such tax liability." See id.; sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. For purposes ofsection 6330(c)(2)(B), a prior opportunity for a conference with the Appeals Office, such as the conference received by petitioner in this case, which culminated in the letter to pe

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, intentional failure or reckless indifference toward filing or payment obligations. United States v. Boyle, 469 U.S. 241, 245 (1985). Petitioner claims he did not file a return or pay the tax due because he believed that as a resident ofPuerto Rico he did not have a U.S

references were not necessary. The closing agreement created the accounts receivable under Rev. Proc. 99-32, supra, which states that the interest by the obligee is taxable income. Therefore a reference to sec. 11 would be redundant. Additionally, sec. 301.7121- 1(d)(2), Proced. & Admin. Regs. provides that "[a]ny tax or deficiency in tax determined pursuant to a closing agreement shall be assessed and collected * * * in accordance with the applicable provisions oflaw." IRM pt. 8.13.1.2.18 (Nov

301.7502-1(a), Proced. & Admin. Regs. 5The IRS contends that Drilling did not attach a Form W-2 to the Form 1040EZ. Drilling contends he did attach a Form W-2. Drilling did not testify that he attached a Form W-2 to the Form 1040EZ. Nor did he provide documentary evidence that he attached a Form W-2 to the Form 1040EZ. The Form 1040EZ itselfis

to the taxpayer. The taxpayer must, however, be given the right to a hearing within a reasonable time after the levy. Id. A taxpayermust request a section 6330 hearing within 30 days ofthe date ofthe written section 6330 notice. Sec. 6330(a)(3)(B); sec. 301.6330-1(b)(1), (c)(2), Q&A-C3, Proced. & Admin. Regs. Ifa taxpayerrequests a section 6330 hearing, the hearing is to be conducted by Appeals. Sec. 6330(b)(1). Section 6330(c) specifies the matters that may be considered at the hearing. At the

nd the FPAA to the address listed on the partnership return for the year in issue.9 The Commissioner is not 7Chomp Assocs. v. Commissioner, 91 T.C. 1069, 1073 (1988) ("[S]ection 6223 does not require that a specific TMP be enumerated on the FPAA."); sec. 301.6223(a)-1(a)(1), Proced. & Admin. Regs. 8See Taurus FX Partners, LLC v. Commissioner, T.C. Memo. 2013-168, at *8 (relying on Utah Bioresearch 1984, Ltd. v. Commissioner, T.C. Memo. 1989- 612); compare sec. 6212(b)(1) w_ sec. 6223(c)(1). °Sec

301.6651-1(c)(1), Proced. & Admin. Regs. Petitioner has not asserted inability to file the Forms 5330, however, nor has petitioner claimed financial inability or undue hardship to excuse its failure to pay the section 4972 excise taxes due. CL 1_4 Rather, petitioner argues that it reasonably relied on the advice ofits attorney that it was unne

Green Gas elected to be taxed as a partnership under section 301.7701- 3, Proced.

ary business care and prudence but nevertheless was unable to file the return within the prescribed time, typically for reasons outside the taxpayer's control. See McMahan v. Commissioner, 114 F.3d 366, 368-369 (2d Cir. 1997), § T.C. Memo. 1995-547; sec. 301.6651-1(c)(1), Proced. & Admin. Regs. - 8 - [*8] Petitioner was required to file Forms 1040 for 2005, 2006, and 2007 and failed to do so until September 2009. See sec. 6012(a)(1)(A). Accordingly, respondent has carried his burden ofproducing

tion to the Qualified Offer Rule and Knudsen Where the taxpayermakes a qualified offer under section 7430(g), the qualified offer rule does not apply to "anyjudgment issued pursuant to a - 13 - [*13] settlement". Sec. 7430(c)(4)(E)(ii)(I); see also sec. 301.7430-7(a), Proced. & Admin. Regs. ("An award ofreasonable administrative and litigation costs under the qualified offer rule only includes those costs * * * attributable to the adjustments * * * that were included in the court'sjudgment other

he hearing request, including spousal defenses and collection alternatives. The taxpayergenerally only can ask the Court to consider an issue that was raised in the taxpayer's administrative hearing. Magana v. Commissioner, 118 T.C. 488, 493 (2002); sec. 301.6330-1(f)(2), Q&A-F5, Proced. & Admin. Regs. When the taxpayerdoes not present a collection alternative or a spousal defense for the settlement officer to consider, it is impossible for the Court to conclude that the settlement officer abuse

301.6330-1(e)(1), Proced. & Admin. Regs. Following the hearing, Appeals must determine whether proceeding with the proposed levy action is appropriate. In making that determination, Appeals is required to take into consideration: (1) verification presented by the Secretary during the hearing process that the requirements ofapplicable law and a

4.03(2)(b), provides that an economic hardship "exists ifsatisfaction ofthe tax liability in whole or in part will cause the requesting spouse to be unable to pay reasonable basic living expenses." Whether a requesting spouse will suffer economic hardship is based on rules similar to those in section 301.6343-1(b)(4), Proce

301.7121-1(d), Proced. & Admin. Regs. One type, completed on Form 866, Agreement as to Final Determination ofTax Liability, conclusively determines a taxpayer's liability for a particular year or years. See Urbano, 122 T.C. at 393; Zaentz v. Commissioner, 90 T.C. 753, 760- 761 (1988); Rev. Proc. 68-16, 1968-1 C.B. 770. The second type, complet

yment for one year against the taxpayer's liability for another year, "the Commissioner is not precluded from subsequently determining a deficiency for the taxable year in respect ofwhich the overpayment was originally claimed and allowed." See also sec. 301.6402-3(a)(5) and (6), Proced. & Admin. Regs. (allowing a refund shown on a return to be credited under section 6402 against any outstanding tax liability ofthe taxpayer). Obviously, ifthe Commissioner can still determine a deficiency for the

301.6320-1(f)(2), Q&A-F3, Proced. Admin. Regs.; see also Thompson v. Commissioner, 140 T.C. 173, 178 (2013). Moreover, even ifpetitioner had requested consideration ofhis underlying liabilities at his CDP hearing, which he did not, he failed to present any evidence to support his position even after the SO gave him a generous amount of time to

301.6651-1(c)(1), Proced. & Admin. Regs. Reasonable cause exists for purposes ofsection 6651(a)(1) ifthe taxpayermakes a satisfactory showing that it exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time. S_e_e sec. 301.6651-1(c)(1), Proced. & Admin. Regs. For the remaining pena

301.6651-1(c)(1), Proced. & Admin. Regs. Petitioners failed to produce evidence to show other than their unpersuasive testimonythat they tried to timely satisfy their tax liabilities. Although we do not doubt that petitioners suffered financial difficulties during the years at issue, we cannot determine on the basis ofthe record whether they m

Entity Classification ofLLC Section 301.7701-3(a), Proced.

301.7701-3(a), Proced. & Admin. Regs. A deduction for a partner's distributive share ofpartnership losses is allowed only to the extent of the adjusted basis ofthe partner's interest in the partnership at the end ofthe partnership year in which such loss occurred. Sec. 704(d). Any increase in a partner's share ofliabilities ofthe partnership i

301.6404-2(b)(2), Proced. & Admin. Regs. A managerial act is an administrative act that occurs during the processing ofa taxpayer's case involving the temporary or permanent loss ofrecords or the exercise ofjudgment or discretion relating to management of personnel. Sec. 301.6404-2(b)(1), Proced. & Admin. Regs. Even when there has been an erro

301.7121-1(d), Proced. & Admin. Regs. One type, completed on Form 866, Agreement as to Final Determination ofTax Liability, conclusively determines a taxpayer's liability for a particular year or years. See Urbano, 122 T.C. at 393; Zaentz v. Commissioner, 90 T.C. 753, 760- 761 (1988); Rev. Proc. 68-16, 1968-1 C.B. 770. The second type, complet

oses ofthis section." The Secretary may so designate a private delivery service only ifhe deter- mines that it is at least as timely and reliable as the U.S. mail and that it meets other criteria specified in the statute. See sec. 7502(f)(2)(A)-(D); sec. 301.7502- 1(c)(3), Proced. & Admin. Regs. (stating that the "timely mailed, timely filed" rule applies to a private delivery service "ifthe Commissioner determines that the ser- vice satisfies the conditions ofsection 7502(f)(2)"). In 1997 the C

n 1867, almost a century and a halfago, whistleblowers could receive an award for information relating to criminal tax violations. Respondent's admission is at loggerheads with his fundamental "Although inapplicable in these cases, see supra note 9, sec. 301.7623- 2(a)(2), Proced. & Admin. Regs., includes criminal investigations in its definition ofadministrative action. "[T]he term administrative action means all or a portion ofan Internal Revenue Service (IRS) civil or criminal proceeding agai

c)(2). II. Whether Diebold New York Was a Transferee Under Section 6901 For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The inquiry regarding transferee liability under section 6901 has two separate and -15- [*15] independent prongs. See Salus Mundi II, 776 F.3d at 1018-1019; Diebold Found., Inc. v. Commissioner, 736 F.3d at

liability for 2011. He is thus precluded from disputing that liability here. See Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Where a taxpayer in a CDP hearing disputes an alleged misapplication ofa credit or overpayment, a de novo standard ofreview has sometimes been applied on the theory that this represents a challeng

nd 2012 NFTL filings were properly signed and, therefore, did not verify that all requirements ofapplicable law and administrative procedure have been met. An NFTL is required to be filed on a Form 668(Y), Notice ofFederal Tax Lien. Sec. 6323(f)(3); sec. 301.6323(f)-1(d)(1), Proced. & Admin. Regs. Section 301.6323(f)-1(d)(2), Proced. & Admin. Regs., defines Form 668 to mean "either a - 13 - [*13] paper form or a form transmitted electronically, * * * [that] must identify the taxpayer, the tax li

alternatives. Sec. 6330(c)(2)(A). A taxpayermay challenge the existence or amount ofthe underlying tax liability if he/she did not receive a notice ofdeficiency or otherwise have a prior opportunity to dispute the tax liability. Sec. 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. After the IRS issues a notice ofdetermination, a taxpayer may petition this Court for review thereof. Sec. 6330(d)(1). The Court's review ofthe IRS' determination is subject to the provisions ofse

alternatives. Sec. 6330(c)(2)(A). A taxpayermay challenge the existence or amount ofthe underlying tax liability if he/she did not receive a notice ofdeficiency or otherwise have a prior opportunity to dispute the tax liability. Sec. 6330(c)(2)(B); sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. After the IRS issues a notice ofdetermination, a taxpayer may petition this Court for review thereof. Sec. 6330(d)(1). The Court's review ofthe IRS' determination is subject to the provisions ofse

erial and ministerial acts performed after the IRS contacts the taxpayer in writing, the Court will review only petitioners' request for interest abatement for managerial and ministerial acts performed after November 1, 2007. S_e_e sec. 6404(e)(1); sec. 301.6404-2(a)(2), Proced. & Admin. Regs. I. Abatement ofInterest Generally For tax years beginning after July 30, 1996, the Commissioner is permitted to abate interest on any deficiency in tax attributable, in whole or in part, to any unreasonabl

he hearing request, including spousal defenses and collection alternatives. The taxpayergenerally only can ask the Court to consider an issue that was raised in the taxpayer's administrative hearing. Magana v. Commissioner, 118 T.C. 488, 493 (2002); sec. 301.6330-1(f)(2), Q&A-F5, Proced. & Admin. Regs. When the taxpayerdoes not present a collection alternative or a spousal defense for the settlement officer to consider, it is impossible for the Court to conclude that the settlement officer abuse

301.6203-1, Proced. & Admin. Regs. The summary record ofassessment may be made either on an IRS Form 23C, Assessment Certificate-SummaryRecord of Assessments, or on its computer-generated equivalent, the Revenue Accounting Control System Report 006. See, e.g., March v. IRS, 335 F.3d 1186, 1188 (10th Cir. 2003); Roberts v. Commissioner, 118 T.C

ted sale ofthe corporation's stock to an intermediary and that these and substantially similar transactions are designated "listed transactions" for purposes ofsec. 1.6011-4T(b)(2), Temporary Income Tax Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and sec. 301.6111-2T, Temporary Proced. & Admin. Regs., 65 Fed. Reg. 11218 (Mar. 2, 2002). - 36 - [*36] similar to a listed transaction.6 Given this reference by Fortrend and Midcoast and especially PwC's warning to John, the Marshalls and their Schwabe a

nd the FPAA to the address listed on the partnership return for the year in issue.9 The Commissioner is not 7Chomp Assocs. v. Commissioner, 91 T.C. 1069, 1073 (1988) ("[S]ection 6223 does not require that a specific TMP be enumerated on the FPAA."); sec. 301.6223(a)-1(a)(1), Proced. & Admin. Regs. 8See Taurus FX Partners, LLC v. Commissioner, T.C. Memo. 2013-168, at *8 (relying on Utah Bioresearch 1984, Ltd. v. Commissioner, T.C. Memo. 1989- 612); compare sec. 6212(b)(1) w_ sec. 6223(c)(1). °Sec

issue not raised in the assignments of error shall be deemed to be conceded."); Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A- F3, Proced. & Admin. Regs. - 8 - [*8] C. Analysis In deciding whether SO2 abused his discretion in sustaining the NFTL filing, we consider whether he: (1) properly verified that the requirements ofany applicable law or adm

301.7122-1(b), Proced. & Admin. Regs. The Secretary may compro- mise a tax liability based on doubt as to collectibility--the ground petitioners ad- vanced in their OIC--where the taxpayer's assets and income render full collection unlikely. Id. subpara. (2). Conversely, the IRS may reject an OIC where the tax- payer's RCP is greater than the

n 1867, almost a century and a halfago, whistleblowers could receive an award for information relating to criminal tax violations. Respondent's admission is at loggerheads with his fundamental "Although inapplicable in these cases, see supra note 9, sec. 301.7623- 2(a)(2), Proced. & Admin. Regs., includes criminal investigations in its definition ofadministrative action. "[T]he term administrative action means all or a portion ofan Internal Revenue Service (IRS) civil or criminal proceeding agai

- 21 - [*21] 60, 64 (1980). However, ifthe transfer is a loan or ifthe benefit to the shareholder is indirect or derivative, there is no constructive distribution. Id. at 64. In considering whether a transfer is a loan, the Court looks to "whether there was a genuine intention to create a debt, which, in turn, depends upon weighing such

)(iii). This right, however, carries with it certain obligations on the taxpayer's part. As provided in the regulations, "[t]axpayers will be expected to provide all relevant information requested by * * * [the SO], including financial statements." Sec. 301.6330- 1(e)(1), Proced. & Admin. Regs. A taxpayer must also be in full compliance with his Federal tax filing obligations in order to be eligible for a collection alternative. S_e_e Giamelli v. Commissioner, 129 T.C. 107, 111-112 (2007) (findi

i- cial review "and the Tax Court shall havejurisdiction with respect to such matter." Sec. 6330(d).7 "A taxpayerwho fails to make a timely request for a CDP hearing is not entitled to a CDP hearing," but he may be afforded an "equivalent hearing." Sec. 301.6330-1(i)(1), Proced. & Admin. Regs. Any reliefafforded in an equivalent hearing is discretionary with the IRS; the "decision letter" issued after such a hear- ing is not subject tojudicial review. R para. (i)(2), Q&A-16. The collection perio

tion to the Qualified Offer Rule and Knudsen Where the taxpayermakes a qualified offer under section 7430(g), the qualified offer rule does not apply to "anyjudgment issued pursuant to a - 13 - [*13] settlement". Sec. 7430(c)(4)(E)(ii)(I); see also sec. 301.7430-7(a), Proced. & Admin. Regs. ("An award ofreasonable administrative and litigation costs under the qualified offer rule only includes those costs * * * attributable to the adjustments * * * that were included in the court'sjudgment other

301.6651-1(c)(1), Proced. & Admin. Regs. Reasonable cause exists for purposes ofsection 6651(a)(1) ifthe taxpayermakes a satisfactory showing that it exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time. S_e_e sec. 301.6651-1(c)(1), Proced. & Admin. Regs. For the remaining pena

301.7430-5(c)(1), Proced. & Admin. Regs. The Commissioner is entitled to maintain his position, for purposes of determining whether it was substantiallyjustified, until adequate substantiation is received from the taxpayer. See Baldwin v. Commissioner, T.C. Memo. 2015-66. Further, where the resolution ofadjustments hinges on factual determinat

ec. 6651(a)(1); Higbee v. Commissioner, 116 T.C. 438, 447 (2001). "Ifthe taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time, then the delay is due to a reasonable cause." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs. The taxpayer can show that she did not act with "willful neglect" ifshe can "prove that the late filing did not result from a 'conscious, intentional failure or reckless indifference.'" Niedringhaus v. Com

301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. For taxes that are not subject to deficiency procedures, 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." Id.; see also Lewis v. Commissioner, 128 T.C. 48 (2007

301; Truesdell v. Commissioner, 89 T.C. 1280, 1295-1296 (1987). 25These include a check payable to T.J. Oil & Gas for $12,500; individual investor checks payable to Gulfport Oil & Gas totaling $327,200; Investec checks payable to Gulfport Oil & Gas totaling $163,752; and production checks payable to Gulfport Oil & Gas totaling $921,988. - 66

hearing. A face-to-face hearing is not a requirement under section 6330. See Katz v. Commissioner, 115 T.C. 329, 337-338 (2000) (holding that a hearing by telephone or by correspondence is sufficient to satisfy the requirements under section 6330); sec. 301.6330-1(d)(2), Q&A-D6, Proced. & Admin. Regs. The regulations further provide that ifa face-to-face hearing is not held, a hearing conducted by telephone, by correspondence, or by review ofdocuments will - 13 - [*13] suffice for purposes ofse

301.6011-1(b), Proced. & Admin. Regs. This Court treats the filing ofan invalid return as the equivalent ofnot filing a return for section 6651(a)(1) purposes. See Cabirac v. Commissioner, 120 T.C. 163, 169 (2003), aff'd per curiam, 94 A.F.T.R. 2d (RIA) 2004-5490 (3d Cir. 2004); McNeil v. Commissioner, T.C. Memo. 2011-150, aff'd, 451 F. App'x

Green Gas elected to be taxed as a partnership under section 301.7701- 3, Proced.

at oral argument would be neither helpful nor productive, and we accordingly deny that request. See Rule 50(b)(3). - 4 - [*4] describing the tax shelter" and "describing the tax benefits * * * represented (or to be represented) to investors[.]" See sec. 301.6111-1T, Temporary Proced. & Admin. Regs., 49 Fed. Reg. 32713 (Aug. 15, 1984). Section 6112(a) required any person who organized or sold "any potentially abusive tax shelter" to maintain a list ofinvestors. See sec. 301.6112-1T, Temporary Pro

for the Eastern District ofTexas. As a result, petitioner's shares ofthe part- nership items ofTB and HVPS were converted to nonpartnership items. That conversion was effective as ofthe date the bankruptcy petition was filed. See sec. 6231(c)(1)(E); sec. 301.6231(c)-7(a), Proced. & Admin. Regs. 2TB reported no gain from the asset sales to VAS or Metric on its Form 1065 for 2009 or 2010. - 8 - [*8] C. The IRS Audit The IRS examined TB's and HVPS' returns for 2008-2010 and disallowed the deduction

301.6651-1(c)(1), Proced. & Admin. Regs.; see a_lso Boyle, 469 U.S. at 246. Willful neglect is interpreted as a "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. The parties stipulated that petitioner's 2001 return was due October 15, 2002, and that his 2002 return was due April 15, 2003. Respondent received an

nd the FPAA to the address listed on the partnership return for the year in issue.9 The Commissioner is not 7Chomp Assocs. v. Commissioner, 91 T.C. 1069, 1073 (1988) ("[S]ection 6223 does not require that a specific TMP be enumerated on the FPAA."); sec. 301.6223(a)-1(a)(1), Proced. & Admin. Regs. 8See Taurus FX Partners, LLC v. Commissioner, T.C. Memo. 2013-168, at *8 (relying on Utah Bioresearch 1984, Ltd. v. Commissioner, T.C. Memo. 1989- 612); compare sec. 6212(b)(1) w_ sec. 6223(c)(1). °Sec

ted sale ofthe corporation's stock to an intermediary and that these and substantially similar transactions are designated "listed transactions" for purposes ofsec. 1.6011-4T(b)(2), Temporary Income Tax Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and sec. 301.6111-2T, Temporary Proced. & Admin. Regs., 65 Fed. Reg. 11218 (Mar. 2, 2002). - 36 - [*36] similar to a listed transaction.6 Given this reference by Fortrend and Midcoast and especially PwC's warning to John, the Marshalls and their Schwabe a

301.6320-1(e)(1), Proced. & Admin. Regs. - 4 - petitioners a letter scheduling a telephone CDP hearing for June 18, 2015. The letter also requested documentation to support their dispute ofthe underlying liability and to comply with the requirements for collection alternatives. Petitioners were again offered a face-to-face hearing or a corres

301.6203-1, Proced. & Admin. Regs.] - 29 - or regulations prescribed by the Secretary'." (quoting section 6203)). Assessment ofthe 20% penalties at issue in this case cannot happen until our decision becomes final and unappealable. See secs. 6213(a), 6665(a), 7485. Consequently, under a plain reading ofthe statute, the issue petitioners seek

has made a satisfactory showing that he exercised ordinary business care and prudence in providing for payment ofhis tax liability and was nevertheless either unable to pay the tax or would suffer an undue hardship * * * ifhe paid on the due date." Sec. 301.6651-1(c)(1), Proced. & Admin. Regs.; see also Downing v. Commissioner, 1 18 T.C. 22, 28 (2002). Petitioner argues that he satisfied the reasonable cause standard in section 301.6651-1(c)(1), Proced. & Admin. Regs., because he exercised ordin

301.6159-1(a), (c)(1)(i), (iii) Proced. & Admin. Regs. "As a condition to entering into an installment agreement with a taxpayer, the Commissioner may require that--(A) The taxpayer agree to a reasonable extension ofthe period oflimitations on collection; and (B) The agreement contain terms that protect the interests ofthe Government." Id. par

for the Eastern District ofTexas. As a result, petitioner's shares ofthe part- nership items ofTB and HVPS were converted to nonpartnership items. That conversion was effective as ofthe date the bankruptcy petition was filed. See sec. 6231(c)(1)(E); sec. 301.6231(c)-7(a), Proced. & Admin. Regs. 2TB reported no gain from the asset sales to VAS or Metric on its Form 1065 for 2009 or 2010. - 8 - [*8] C. The IRS Audit The IRS examined TB's and HVPS' returns for 2008-2010 and disallowed the deduction

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, intentional failure or reckless indifference. United States v. Boyle, 469 U.S. 241, 245 (1985). The Mallorys did not address the addition to tax for their failure to timely file a return for the 2011 taxable year at trial or in their opening brief. Issues that are not

301.6330-1(e)(1), Proced. & Admin. Regs. Section 7122(a) authorizes the Secretary to compromise a taxpayer's income tax liability. In general, the decision to accept or reject an offer as well as the terms and conditions agreed to are left to the discretion ofthe Commissioner. Sec. 301.7122-1(a)(1), (c)(1), Proced. & Admin. Regs. The grounds f

When a Letter 1153 is mailed, the Commissioner must follow the same mailing procedures that are provided for - 18 - [*18] notices ofdeficiency in section 6212(b). Sec. 6672(b)(1). This Court has held that the same evidence that establishes that the Commissioner mailed a notice ofdeficiency to a taxpayer's last known address should

Under section 301.7430-2(c)(6), Proced. & Admin. Regs., ifthe Commissioner does not - 20 - respond to an application for administrative costs within six months, the failure to respond can be considered a decision ofthe Commissioner denying the award. In supplemental briefing respondent argues that the petition is untimely because it was filed on April 1

301.7701-3(b)(1)(i), Proced. & Admin. Regs. - 12 - [*12] were typically kept in the bank. This essentially meant that the two parties (the LLC and the bank) exchanged promises, but no actual money. The interest payable on the loan would be higher than the interest receivable from the two instruments. This created a spread that the LLC would n

4.03(2)(b), provides that an economic hardship "exists ifsatisfaction ofthe tax liability in whole or in part will cause the requesting spouse to be unable to pay reasonable basic living expenses." Whether a requesting spouse will suffer economic hardship is based on rules similar to those in section 301.6343-1(b)(4), Proce

301.7701-2(a), Proced. & Admin. Regs. - 19 - [*19] that AUI elected to combine its activities with WUG's activities for the years in issue. That stipulation is contradicted by the election attached to AUI's 2007 Form 1065 and signed by Dr. Steinberger, and the Court does not have to accept the parties' stipulation. See Cal-Maine Foods, Inc. v

301.6330-1(e)(1), Proced. & Admin. Regs. Following the hearing Appeals must determine whether proceeding with the proposed levy action is appropriate. In making that determination, Appeals is - 10 - [*10] required to take into consideration: (1) verification presented by the Secretary during the hearing process that the requirements ofapplica

301.6651-1(c)(1), Proced. & Admin. Regs. Reasonable cause exists for purposes ofsection 6651(a)(1) ifthe taxpayermakes a satisfactory showing that it exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time. S_e_e sec. 301.6651-1(c)(1), Proced. & Admin. Regs. For the remaining pena

301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. Petitioner is not entitled to challenge his underlying tax liabilities for the years at issue because he did not properly raise the underlying liabilities during his CDP hearings. Petitioner failed to present any evidence regarding the liabilities after being given reasonable time. For both his

T.C. at 447. Reasonable cause excusing a failure to timely file exists ifthe taxpayer exercised ordinary business care and prudence but nevertheless was unable to file the return by the deadline. See Crocker v. Commissioner, 92 T.C. 899, 913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. "Generally, factors that constitute 'reasonable cause' include unavoidable postal delays, death or serious illness ofthe taxpayer or a member ofhis immediate family, or reliance on the mistaken legal opin

for the Eastern District ofTexas. As a result, petitioner's shares ofthe part- nership items ofTB and HVPS were converted to nonpartnership items. That conversion was effective as ofthe date the bankruptcy petition was filed. See sec. 6231(c)(1)(E); sec. 301.6231(c)-7(a), Proced. & Admin. Regs. 2TB reported no gain from the asset sales to VAS or Metric on its Form 1065 for 2009 or 2010. - 8 - [*8] C. The IRS Audit The IRS examined TB's and HVPS' returns for 2008-2010 and disallowed the deduction

301; Truesdell v. Commissioner, 89 T.C. 1280, 1295-1296 (1987). 25These include a check payable to T.J. Oil & Gas for $12,500; individual investor checks payable to Gulfport Oil & Gas totaling $327,200; Investec checks payable to Gulfport Oil & Gas totaling $163,752; and production checks payable to Gulfport Oil & Gas totaling $921,988. - 66

301.7701-3(b)(1)(i), Proced. & Admin. Regs. - 12 - [*12] were typically kept in the bank. This essentially meant that the two parties (the LLC and the bank) exchanged promises, but no actual money. The interest payable on the loan would be higher than the interest receivable from the two instruments. This created a spread that the LLC would n

ted sale ofthe corporation's stock to an intermediary and that these and substantially similar transactions are designated "listed transactions" for purposes ofsec. 1.6011-4T(b)(2), Temporary Income Tax Regs., 65 Fed. Reg. 11207 (Mar. 2, 2000), and sec. 301.6111-2T, Temporary Proced. & Admin. Regs., 65 Fed. Reg. 11218 (Mar. 2, 2002). - 36 - [*36] similar to a listed transaction.6 Given this reference by Fortrend and Midcoast and especially PwC's warning to John, the Marshalls and their Schwabe a

301(g), 90 Stat. at 1553. Former section 58(h) provided: "The Secretary shall prescribe regulations under which items of tax preference shall be properly adjusted where the tax treatment giving rise to such items will not result in the reduction ofthe taxpayer's tax under this subtitle for any taxable years." In Occidental Petroleum Corp. v. C

ny evidence regarding its entitlement to withdrawal ofthe NFTL filing and therefore did not properly raise the issue before the Appeals Office or this Court. See Giamelli v. Commissioner, 129 T.C. at 115; Magana v. Commissioner, 118 T.C. at 493-494; sec. 301.6320-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The Appeals Office properly balanced the need for efficient collection oftaxes with petitioner's concerns regarding the intrusiveness ofthe proposed collection actions. - 21 - [*21] We have consid

301.6330-1(c)(2), Q&A- C7, (i)(1), Proced. & Admin. Regs. We do not havejurisdiction to review respondent's decision letter regarding that lien notice, see Severo v. Commissioner, 129 T.C. 160, 163 (2007), M, 586 F.3d 1213 (9th Cir. 2009), nor did petitioners seek review in their petition. We discuss it here because the hearings on the lien no

, 137 T.C. at 17. II. Excess contributions to Roth IRAs A. Roth IRAs and Section 4973 Congress authorized the Roth IRA, a type ofindividual retirement account, with the enactment ofsection 408A in the Taxpayer ReliefAct of 1997, Pub. L. No. 105-34, sec. 301, 111 Stat. at 824. The distinguishing feature ofa Roth IRA is the timing ofthe tax benefit; the contributions to a Roth IRA are not tax deductible, but all earnings accumulate tax free and all qualified distributions from such an account are

, 137 T.C. at 17. II. Excess contributions to Roth IRAs A. Roth IRAs and Section 4973 Congress authorized the Roth IRA, a type ofindividual retirement account, with the enactment ofsection 408A in the Taxpayer ReliefAct of 1997, Pub. L. No. 105-34, sec. 301, 111 Stat. at 824. The distinguishing feature ofa Roth IRA is the timing ofthe tax benefit; the contributions to a Roth IRA are not tax deductible, but all earnings accumulate tax free and all qualified distributions from such an account are

438. To show reasonable cause, taxpayers must demonstrate that they exercised ordinary business care and prudence but nevertheless were unable to file their income tax returns by their due dates. See United States v. Boyle, 469 U.S. 241, 246 (1985); sec. 301.6651-1(c), Proced. & Admin. Regs. Willful neglect is defined as a "conscious, intentional failure or reckless indifference." Boyle, 469 U.S. at 245. Respondent has met his burden because petitioner filed his return late for the year in issue

301.7701-3, Proced. & Admin. Regs. It did not, and because Cave Buttes had more than one member, tax law treats it as a partnership by default. See id.; see also K.H. Co., LLC Emp. Stock Ownership Plan v. Commissioner, T.C. Memo. 2014-31. (All section references are to the Internal Revenue Code and regulations in effect for the tax year in iss

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, intentional failure or reckless indifference. United States v. Boyle, 469 U.S. 241, 245 (1985). Petitioner testified that he did not file his 2009 return because he had received an incorrect Form 1099 for a prior tax year, that he had asked respondent what he should do

301.7122-1(b), Proced. & Admin. Regs. The Code leaves the decision to accept or reject an OIC to the Commissioner's discretion, but his decision should be based on all the facts and circumstances relevant to the offer. Il para. (c)(1). Alphson's offer was based on doubt as to collectibility. The Commissioner has said that he'll accept an OIC b

301.6651-1(c)(1), Proced. & Admin. Regs. 64United States v. Boyle, 469 U.S. 241, 245 (1985). - 30 - [*30] requirement to timely file one's return.65 Because Mr. Chaganti has not shown his tardy filing was due to reasonable cause and not due to willful neglect, he is liable for the section 6651(a) additions to tax for 2006 and 2007. IX. Accura

he District ofColumbia. Sec. 7503. Petitioner timely filed her 2009 and 2010 Federal income tax returns. For purposes ofsection 6501, those returns were considered filed on the last day prescribed by law for the filing thereof. See sec. 6501(b)(1); sec. 301.6501(b)-1, Proced. & Admin. Regs. Petitioner is deemed to have filed her 2009 Federal income tax return on April 15, 2010, and her 2010 Federal income tax return on April 18, 2011.5 See sec. 6501(b)(1); sec. 301.6501(b)-1, Proced. & Admin. Re

use. See Boyle, 469 U.S. at 245. To prove reasonable cause, the taxpayermust show that he exercised ordinary business care and prudence but nevertheless could not file the return when it was due. See Crocker v. Commissioner, 92 T.C. 899, 913 (1989); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Section 6656 imposes an addition to tax equal to 10% ofthe portion ofan underpayment in withholding tax that is required to be deposited ifthe failure to deposit extends more than 15 days. A taxpayermay a

t a year and a halfafter it was originally scheduled. There is no requirement that the Commissioner wait a certain amount oftime before making a determination as to a proposed levy. Gazi v. Commissioner, T.C. Memo. 2007- 342, 2007 WL 4119009, at *9; sec. 301.6330-1(e)(3), Q&A-E9, Proced. & Admin. Regs. Rather, the regulations provide that the Appeals Office should "attempt to conduct a CDP hearing and issue a Notice ofDetermination as expeditiously as possible under the circumstances." Sec. 301.

Entity Classification ofLLC Section 301.7701-3(a), Proced.

cation during their CDP hearing and that they are therefore barred from raising the issue before the Court. We agree with respondent. Generally, a taxpayer must raise an issue at a CDP hearing to preserve it for this Court's consideration. E at 115; sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The merits are not properly raised ifthe taxpayer mentions an issue but fails to present Appeals with any evidence regarding that issue after being given a reasonable opportunity to do so. See Del

§ 301.6402-4 which considers taxes paid with a return to be timely paid." C. The Applicability ofthe Section 904 Limitation Respondent further argues that, even ifthe amounts in issue satisfied income tax obligations imposed on petitioners by the Virgin Islands, the amounts could not be credited under section 901 because none ofpetitioners establis

301.7701-3(a), Proced. & Admin. Regs. Because they cannot be classified as partnerships for Federal tax purposes, "there was no partnership loss, and there were no partnership deductions, no contributions to the purported partnership, and no distributions from a partnership to its purported partners. Adjustment ofthose [partnership] items to z

at oral argument would be neither helpful nor productive, and we accordingly deny that request. See Rule 50(b)(3). - 4 - [*4] describing the tax shelter" and "describing the tax benefits * * * represented (or to be represented) to investors[.]" See sec. 301.6111-1T, Temporary Proced. & Admin. Regs., 49 Fed. Reg. 32713 (Aug. 15, 1984). Section 6112(a) required any person who organized or sold "any potentially abusive tax shelter" to maintain a list ofinvestors. See sec. 301.6112-1T, Temporary Pro

at oral argument would be neither helpful nor productive, and we accordingly deny that request. See Rule 50(b)(3). - 4 - [*4] describing the tax shelter" and "describing the tax benefits * * * represented (or to be represented) to investors[.]" See sec. 301.6111-1T, Temporary Proced. & Admin. Regs., 49 Fed. Reg. 32713 (Aug. 15, 1984). Section 6112(a) required any person who organized or sold "any potentially abusive tax shelter" to maintain a list ofinvestors. See sec. 301.6112-1T, Temporary Pro

ll or partial collection ofsuch liability." The IRS has discretion to - 7 - [*7] reject a proposed installment agreement (subject to certain restrictions when the liability is below $10,000). See Thompson v. Commissioner, 140 T.C. 173, 179 (2013); sec. 301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. This Court gives due deference to the determinations the IRS makes in the exercise ofthis discretionary authority. See Woodral v. Commissioner, 112 T.C. 19, 23 (1999); Marascalco v. Commissioner, T.

pertytax Huron pays. Huro 's propertytaxes must be taken into account at the partnership level for its taxable year, and therefore its claimed property-tax expenses and the Maineses' share ofthose expenses are partnership items. See sec. 6231(a)(3);.sec. 301.6231(a)(3)-1, Proced. & Admin. Regs. These credits--because they pass through to tlle Maineses--affectthe Maineses' federal tax bill. That makes them "affect d items." See sec. 6231(a)(5). The Commissioner may issue an affecte -items notice

301.6651-1(c)(1), Proced. & Admin. Regs.; see also United States v. Boyle, 469 U.S. 241, 246 (1985). A failure to pay tax will be considered to be due to reasonable cause ifthe taxpayer exercised ordinary care and prudence in providing for her tax liability but was unable to pay. See sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglec

301.6330-1(e)(1), Proced. & Admin. Regs. Following the CDP hearing the Appeals officer will determine whetherproceeding with the proposed levy is appropriate and issue a notice ofdetermination. Sec. 6330(c)(3); Offiler v. Commissioner, 114 T.C. 492, 498 (2000). Petitioners did not dispute their underlying tax liability for 2005. Where, as here

tech- nical advice memorandum, or ChiefCounsel advice." Sec. 6110(b)(1)(A). The regulations define a "ruling" as "a written statement issued by the National Office to a taxpayer * * * that interprets and applies tax laws to a specific set offacts." Sec. 301.6110-2(d), Proced. & Admin. Regs. "A ruling generally recites the rele- vant facts, sets forth the applicable provisions oflaw, and shows the application of - 13 - the law to the facts." Ibid. "'Issuance' ofa written determination occurs, wi

& Admin Regs., provides that the facts and circumstances to be considered include, but are not limited to: (i) Whether the failure to file timely * * * is part ofa pattern of conduct by the person who filed the return ofrepeatedly failing to file timely * * *; (ii) Whether correction was promptly made upon discovery of the fai

301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglect means a conscious, intentional failure or reckless indifference. United States v. Boyle, 469 U.S. 241, 245 (1985). Palmer contends that his failure to file his federal-income-taxreturns was due to reasonable cause and not due to willful neglect for the following reasons. (1) Palmer alleg

447 (2001). -9- [*9] Reasonable cause requires the taxpayerto demonstrate that he exercised ordinary business care and prudence and nevertheless was unable to file his Form 1040 by the due date. See United States v. Boyle, 469 U.S. 241, 246 (1985); sec. 301.6651-1(c), Proced. & Admin. Regs. We synthesize our discussion of reasonable cause under section 6651(a)(1) and (2) because the standards have been interpreted to be synonymous. See E. Wind Indus., Inc. v. United States, 196 F.3d 499, 504 n.5

301.7701-2(c)(2), Proced. & Admin. Regs. - 4 - [*4] 752 and therefore had no effect on outside basis. The result was a large, artificial increase in outside basis. On December 31, 1998, after closing the short sale transactions, Mr. Jump and the Jump Trust (through Gateway Grain and Omaha Pump) transferred their American Boat partnership inte

allenge the existence or amount ofthe taxpayer's underlying liabilities during the administrative phase ofa case, the taxpayermay not do so upon appeal ofa notice ofdetermination to this Court. See Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; see also Ligman v. Commissioner. T.C. Memo. 2015-79, at *6. On the other hand, the SO appears to have been under the erroneous impression that petitionerwas barred from challenging the existence

301.6231(a)(3)-1(a)(1)(ii), Proced. & Admin. Regs. The Court'sjurisdiction over a TEFRA partnership-level - 19 - [*19] proceeding is invoked upon the Commissioner's issuance ofa valid FPAA and the proper filing ofa petition for readjustment ofpartnership items for the year or years to which the FPAA pertains. See Harbor Cove Marina Partners P

ant issue relating to the unpaid tax or the proposed collection method. Sec. 6330(c)(2)(A). Generally, a taxpayermust raise an issue at a CDP hearing to preserve it for this Court's consideration. Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The merits are not properly raised ifthe taxpayer challenges the underlying tax liability but fails to present Appeals with any evidence regarding that liability after being given a reasonable oppo

301.6320-1(f)(2), A-F3, Proced. & Admin. Regs. Petitioner also failed to respond to the motion as ordered by the Court. By failing to respond to the assertions in the motion, petitioner waived his right to contest them. See Rule 121(d); Lunsford v. Commissioner, 117 T.C. at 187; Akonji v. Commissioner, T.C. Memo. 2012-56, 2012 Tax Ct. Memo LEX

301.6231(a)(3)-1(a)(1)(ii), Proced. & Admin. Regs. The Court'sjurisdiction over a TEFRA partnership-level - 19 - [*19] proceeding is invoked upon the Commissioner's issuance ofa valid FPAA and the proper filing ofa petition for readjustment ofpartnership items for the year or years to which the FPAA pertains. See Harbor Cove Marina Partners P

301.6651-1(c)(1), Proced. & Admin. Regs. Circumstances that are consideredto constitute reasonable cause for failure to timely file a return are typicallythose outside ofthe taxpayer's control, including, for example: (1) unavoidable postal delays; (2) the timely filing ofa return with the wrong office; (3) the death or serious illness ofthe t

301.6320-1(e)(3), Q&A-E7, Proced. & Admin. Regs.; see also Lang - 8 - [*8] v. Commissioner, T.C. Memo. 2014-183; Nelson v. Commissioner, T.C. Memo. 2009-108. We reject respondent's argument that petitioner failed to dispute his underlying liability for the 2003 frivolous return penalty with the settlement officer during the administrative CDP

asonable cause" requires the taxpayerto demonstrate that he exercised ordinary business care and prudence and nevertheless was unable to file his or her Federal income tax return by the due date. See United States v. Boyle, 469 U.S. 241, 246 (1985); sec. 301.6651-1(c), Proced. & Admin. Regs. Willful neglect is defined as a "conscious, intentional failure or reckless indifference." Boyle, 496 U.S. at 245. Petitioners maintain they acted with reasonable cause and without willful neglect with respe

interest abatement that it filed. Because petitioner's interest abatement claim was not presented to or considered by the SO in this CDP case, we lackjurisdiction to consider this claim. See Day v. Commissioner, T.C. Memo. 2014-215, at *11; see also sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; c_f. sec. 6404(e), (h); Rules 280-284. 5Although the SO erred in neglecting to credit petitioner's 2004 account with the $49,845.37 restitution paymentthat Del'Andrae made on its behalffor 2004,

ue not raised in the assignments of error shall be deemed to be conceded."); see Thompson v. Commissioner, 140 T.C. 173, 178 (2013) ("A taxpayer is precluded from disputing the underlying liability ifit was not properly raised in the CDP hearing."); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. - 7 - [*7] ofthe person that any collection action be no more intrusive than necessary." Sec. 6330(c)(3). As to the first point, this Court has authorityto review an SO's satisfaction ofthe verifi

Regs., provides that "[a]n offer to compromise a tax liability pursuant to section 7122 must be submitted according to the procedures, and in the form and manner, prescribed by the Secretary." Petitioner failed to remit either a partial payment ofhis proposed $5,000 compromise or the relevant application fee, and he al

301.6651-1(c)(1), Proced. & Admin. Regs.; see also United States v. Boyle, 469 U.S. 241, 246 (1985). A failure to pay tax will be considered to be due to reasonable cause ifthe taxpayer exercised ordinary care and prudence in providing for her tax liability but was unable to pay. See sec. 301.6651-1(c)(1), Proced. & Admin. Regs. Willful neglec

reviewing for abuse ofdiscretion, we generally consider only the - 8 - [*8] arguments, issues and other matters that were raised at the CDP hearing or otherwise brought to the attention ofAppeals. Giamelli v. Commissioner, 129 T.C. at 115; see also sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. III. Determination To Sustain the Proposed Levy Action Petitioners argue that Settlement Officer Hansen abused his discretion in denying a collection alternative. Respondent argues that petitioners

iefis not granted. A requesting spouse will suffer economic hardship ifpayment ofpart or all ofthe tax liability "will cause the requesting spouse to be unable to pay reasonable basic living expenses." Id. sec. 4.03(2)(b), 2013-43 I.R.B. at 401; see sec. 301.6343-1(b)(4)(i), Proced. & Admin. Regs. The determination as to what constitutes a reasonable amount for basic living expenses may vary according to the circumstances ofthe individual taxpayer but will not include the maintenance ofan afflue

26 CFR §301.6303-1(a)." The Court ofAppeals held: Construing the plain language ofthe statutes and regulations outlined above, i¾ becomes evident that the form ofnotice of assessment ofa §6700 penalty requires only a statement ofthe amount ofthe penalty and a demand for payment. It is also clear that the notice sent to the plaintiffin this case complied w

issued to a taxpayer for a particular taxable period, and the taxpayer files a timely petition in this Court claiming an overpayment for that taxable period, that overpaymentmay be refunded only as provided in section 6512(b). Sec. 6512(a)(1), (b); sec. 301.6512-1(b), Proced. & Admin. Regs. Section 6512(b)(3) limits the amount ofthe taxpayer's credit or refund. Specifically, section 6512(b)(3) circumscribes the amount ofthe taxpayer's credit or refund to the portion ofthe overpayment, ifany, pa

item' means, with respect to a partnership, any item required to be taken into account for the partnership's taxable year under any provision ofsubtitle A to the extent regulations prescribed by the Secretary provide that, for purposes ofthis subtitle, such item is more appropriately determined at the partnership level than at the partner level." Section 301.6231(a)(3)-1(a)(1), Proced.

301.6231(a)(3)-1(a)(1)(ii), Proced. & Admin. Regs. The Court'sjurisdiction over a TEFRA partnership-level - 19 - [*19] proceeding is invoked upon the Commissioner's issuance ofa valid FPAA and the proper filing ofa petition for readjustment ofpartnership items for the year or years to which the FPAA pertains. See Harbor Cove Marina Partners P

301.6159-1(a), (c)(1)(i), Proced. & Admin. Regs. The Court does not normally make an independent determination ofwhat would be an acceptable alternative. Murphy v. Commissioner, 125 T.C. 301, 320 (2005), aff'd, 469 F.3d 27 (1st Cir. 2006). IfAppeals or sf;ttlement officers follow all statutory and administrative - 15 - [*15] guidelines and pr

and not due to willful neglect. "Reasonable cause" contemplates that the taxpayer exercised ordinary business care and prudence and was nonetheless unable to file a return within the prescribed time. United States v. Boyle, 469 U.S. 241, 246 (1985); sec. 301.6651-1(c)(1), Proced. & Admin. Regs. "Willful neglect" means a conscious, intentional failure or reckless indifference. Boyle, 469 U.S. at 245. Section 6651(a)(2) imposes an addition to tax for failure to pay the amount shown as a tax on a r

301.6159-1(c)(1)(ii), Proced. & Admin. Regs. However, payments by the transferor may eliminate or reduce the amount that may be collected from the transferee. See, e.g., Estate ofStein v. Commissioner, 40 T.C. 275, 278 (1963); Leach v. Commissioner, 21 T.C. 70 , 79 (1953); Quirk v. Commissioner, 15 T.C. 709 (1950), aff'd, 196 F.2d 1022 (5th Ci

301.7701-1(a)(1) and (2), Proced. & Admin. Regs. The parties do not dispute that the arrangement betweenpetitioner and Varn was exempt from the application ofsubchapter K because ofthe election in article 14 ofthe agreement. Generally, the Commissioner's determinations in a notice ofdeficiency are presumed correct, and a taxpayerbears the burd

301.6213-1(a)(2), Proced. & Admin. Regs. We may determine whether a deficiency exists for the Bells for 2008 because the notice ofdeficiency was issued before the expiration ofthe three-yearperiod set by section 6501(a). B. MBA MBA's petition also asserts that the statute oflimitations bars respondent from assessing or collecting any deficienc

vely appeal his liabilities for the trust-fund-recovery penalty, and who declines to make such an appeal, had an opportunityto dispute the underlying liability. Pough v. Commissioner, 135 T.C. at 349; Orian v. Commissioner, slip op. at 13; see also sec. 301.6330-1(e)(3), Q&A-E2, Proced. & Admin. Regs. ("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 ofthe liability."). A Letter 1

evant issue relating to the unpaid tax or the proposed collection method. Sec. 6330(c)(2)(A). Generally, a taxpayermust raise an issue at a CDP hearing to preserve it forthis Court's consideration. Giamelli v. Commissioner, 129 T.C. 107, 115 (2007); sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. The merits are not properly raised ifthe taxpayer challenges the underlying tax liability but fails to present Appeals with any evidence regarding that liability after being given a reasonable opp

301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs. "An issue is not properly raised ifthe taxpayer fails to request consideration ofthe issue by Appeals, or ifconsideration is requested but the taxpayer fails to present to Appeals any evidence with respect to that issue after being given a reasonable opportunity to present such evidence." Id. Ad

hallenges to the existence or amount ofthe underlying tax liability for any tax period ifthe taxpayer did not receive any statutory notice ofdeficiency for such tax liability or did not otherwise have an opportunityto dispute it. Sec. 6330(c)(2)(B); sec. 301.6330-1(e)(1), Proced. & Admin. Regs. At the conclusion ofthe CDP hearing, the Appeals officer or employee must determine whether and how to proceed with collection and must take into account (1) verification that the requirements ofany appli

red in thejudicial proceeding. See Day v. Commissioner, T.C. Memo. 2014-215, at *11; see also 7 In addition, it should be recalled that respondentnever determined or asserted the addition to tax; rather, petitionerreported it on his return. - 23 - sec. 301.6330-1(f)(2), Q&A-F3, Proced. & Admin. Regs.; cl sec. 6404(e), (h); Rules 280-284. Conclusion All ofthe arguments advanced by petitioner have been considered.8 To the extent not expressly addressed above, the Court concludes that those argumen

301.6330-1(d)(2), Q&A-D7, Proced. & Admin. Regs. The SO tried to schedule a CDP hearing with petitioner _ 9 _ [*9] and, when he failed to respond, gave him a final opportunity to contest the levy by sending him a "last chance" letter. On the record before us, we find that petitioner was given a reasonable opportunityto seek a collection alter

301.7701-2(c)(2)(iv)(B), Proced. & Admin. Regs. 3For the remainder ofthis report we use the term "employmenttax" to refer to tax under FICA, secs. 3101-3128, FUTA, secs. 3301-3311, and income tax withholding, secs. 3401-3406 and 3509. - 3 - [*3] Background The parties submitted this case fully stipulated under Rule 122. The stipulated facts a

n 242.04(1)(a) ofthe Wisconsin Statutes. Federal Transferee Requirement For purposes ofsection 6901, the term "transferee" includes, inter alia, donee, heir, legatee, devisee, distributee, and shareholder ofa dissolved corporation. See sec. 6901(h); sec. 301.6901-1(b), Proced. & Admin. Regs. The principle ofsubstance over form applies to determinations oftransferee liability issues. See generally Scott v. Commissioner, T.C. Memo. 1998-426, aff'd, 236 F.3d 1239 (10th Cir. 2001). In accordance wit

ted them, during the CDP process. The regulations specifically address the situation where "an Appeals officer considers the merits of a taxpayer's liability in a CDP hearing when the taxpayerhad previously received a statutory notice ofdeficiency." Sec. 301.6320-1(e)(3), Q-El l, Proced. & Admin. Regs. The regulations provide that, in this situation, any adjustmentto the taxpayer's underlying tax liability will not be considered part ofthe notice of determination: In the Appeals officer's sole d