MEMORANDUM OPINION
DINAN, SPECIAL TRIAL JUDGE. This case was called from the calendar of the trial session at San Francisco, California, on January 22, 2001, for hearing on respondent's Motion to Dismiss for Failure to State a Claim Upon Which Relief Can Be Granted, filed November 6, 2000, and petitioner's Notice of Objection, filed December 4, 2000. The parties appeared and were heard.
BACKGROUND
In a statutory notice of deficiency dated April 29, 1998, respondent determined a deficiency in petitioner's Federal income tax for the year 1995 in the amount of $ 9,076, and a penalty pursuant to section 66621 in the amount of $ 640.
The notice of deficiency was mailed, by certified mail, to petitioner's last known address: 359 Greenway Drive, Pacifica, California, 94004-2920592. The notice of deficiency, dated April 29, 1998, was returned to the Internal Revenue Service as unclaimed, after the U.S. Postal Service had waited 15 days for petitioner to claim the letter. The U.S. Postal Service attempted to deliver the notice of deficiency to petitioner on May 1 and 6, 1998.
At the January 22, 2001, hearing in this case, respondent represented to the Court:
In this case, the exhibits attached to our motion show that
the IRS issue of the stat notice to the petitioner at his last
known address, that the Post Office attempted delivery several
times, and that petitioner did not pick up -- refused to pick up
the statutory notice of deficiency.
And apparently the reason as set forth in this objection,
where he indicated he shouldn't have to take time off from work
to pick up a rhetorical letter from the IRS.
As petitioner had the prior opportunity to dispute the
liability, and as he raises no other issue in his petition, the
Court should grant the Government's motion to dismiss for
failure to state a claim upon which relief can be granted.
The Court: Thank you, Mr. Chinnapongse. Mr. Baxter. What did
you want to say?
Mr. Baxter: I didn't realize the importance of the letter
they were sending me at the time, and I did not
take time off of work to pick up.
The Court: How would you know whether it was important or
not unless you looked at it?
Mr. Baxter: I've received many certified letters from the
IRS, all stating the same thing, that I owe money
with nothing else included. I didn't realize this
certain letter was that important.
The Court: You knew that it was down at that mailbox waiting
for you?
Mr. Baxter: Yes, I did. But I put in a lot of hours at that
job when that came out and I could not take time
off from work.
In Sego v. Commissioner, 114 T.C. 604 (2000), Steven Sego and Davina Sego petitioned the Court in response to two Notices of Determination Concerning Collection Action(s) Under Section 6320 and/or 6330, regarding the years 1993, 1994, and 1995. In their petition, taxpayers sought to challenge their underlying Federal income tax liabilities for 1993, 1994, and 1995. The Commissioner alleged that taxpayers were precluded from challenging the underlying liabilities because they had received statutory notices of deficiency for those liabilities.
The Court found that statutory notices of deficiency with respect to 1993, 1994, and 1995 were sent to each taxpayer on August 13, 1997. Duplicate originals were sent to Steven Sego, one addressed to Spirit Lake, Idaho, and one addressed to Rathdrum, Idaho. The notice sent to Spirit Lake was returned undelivered by the U.S. Postal Service. The notice sent to Rathdrum was returned to respondent. Handwritten across the first page of the returned notice were the words "This presentment Dishonored at UCC 1-207".
The notice of deficiency for 1993, 1994, and 1995 was sent to Davina Sego at the Rathdrum, Idaho, address. After two notices of certified mail were left in the taxpayers' Rathdrum mailbox on August 18, 1997, and August 25, 1997, the notice was returned to respondent by the U.S. Postal Service.
A U.S. Postal Service employee responsible for the postal route that includes taxpayers' address testified that she attempted delivery of certified mail to Davina Sego on August 18, 1997, and left a second notice of attempted delivery on August 25, 1997.
The Court held, in Sego v. Commissioner, 114 T.C. at 610:
Steven Sego received the statutory notice of deficiency in time
to file a petition but repudiated that right by returning to
respondent the statutory notice of deficiency with frivolous
language on it. He did not file a petition, and the express
language of section 6330(c)(2)(B) precludes de novo review of
his tax liability in this proceeding.
Davina Sego did not actually receive a statutory notice of
deficiency. * * *
In Sego v. Commissioner, 114 T.C. at 611, the Court also held:
The applicable legal principles with respect to Davina Sego
are set forth in Erhard v. Commissioner, 87 F.3d 273 (9th Cir.
1996), affg. T.C. Memo. 1994-344, and Patmon & Young
Professional Corp. v. Commissioner, 55 F.3d 216, 218 (6th Cir.
1995), affg. T.C. Memo. 1993-143, which held that taxpayers
cannot defeat actual notice by deliberately refusing delivery of
statutory notices of deficiency. Petitioners' conduct in this
case constituted deliberate refusal of delivery and repudiation
of their opportunity to contest the notices of deficiency in
this Court, which provides the prepayment option for disputing
tax liability. (They still have the option, however, of paying
the tax and instituting suits for refund.) The provisions in
section 6330(c)(2)(B) limiting in collection due process cases
their right to contest the underlying tax liability are clearly
intended to prevent the creation of a belated prepayment remedy
in cases such as this one. The validity of the underlying tax
liability is not properly before the Court.
The facts in the instant case are substantially similar to those pertaining to Davina Sego.
Based upon the foregoing and considering the colloquy between the Court and petitioner at the January 22, 2001, hearing on respondent's motion to dismiss, we find as a fact that petitioner refused delivery of the statutory notice of deficiency for 1995 mailed to him on April 29, 1998.
On March 13, 1999, approximately 1 year after respondent mailed to petitioner the notice of deficiency for the year 1995, petitioner sent to the Internal Revenue Service an Amended U.S. Individual Income Tax Return for 1995. The address listed on the amended return is 359 Greenway Drive, Pacifica, California 94044.
On October 13, 1999, respondent mailed to petitioner a Notice of Intent to Levy and Notice of Your Right to a Hearing, pursuant to sections 6330(a) and 6331(d)(2), pertaining to petitioner's 1995 Federal income tax liability. At a time not specified in the record, petitioner requested a section 6330 hearing in this case, based upon the above-mentioned notice of intent to levy, dated October 13, 1999.
In a Notice of Determination Concerning Collection Action(s) Under Section 6320 and/or 6330, dated May 22, 2000, the Appeals Office of the Internal Revenue Service, San Jose, California, advised petitioner:
SUMMARY OF DETERMINATION
The taxpayer questions the validity of the tax assessment
because he feels that his employer provided two different W-2's
when there should have only been one. However, there has been no
evidence provided to show that his employer(s) made a mistake.
The two W-2's were for different amounts and were sent in by two
different business entities with different employer
identification numbers. The taxpayer was provided an opportunity
to file an administrative appeal of the tax adjustment but did
not claim the Notice of Deficiency which was mailed certified to
the correct address. The Problem Resolution Office also reviewed
this case and advised the taxpayer that he needed to secure a
corrected W-2 if in fact there was a mistake made. The taxpayer
will not be provided with a reconsideration of the tax
assessment by the Examination Division.
Petitioner filed an Amended Petition for lien or levy action under section 6320(c) or 6330(d) on September 19, 2000.
DISCUSSION
Section 6330(c)(2)(B) provides:
(B) Underlying liability. -- The person may also raise at
the hearing challenges to the existence or amount of the
underlying tax liability for any tax period if the person did
not receive any statutory notice of deficiency for such tax
liability or did not otherwise have an opportunity to dispute
such tax liability.
We have previously found as a fact that petitioner refused delivery of the statutory notice of deficiency for 1995, mailed to him on April 29, 1998. Petitioner did not petition this Court from the April 29, 1998, notice. He is, therefore, by law, prohibited from challenging his 1995 Federal income tax liability in a section 6330 hearing or proceeding. See Sego v. Commissioner, supra 114 T.C. 604 Because petitioner is prohibited from challenging his 1995 Federal income tax liability in such a hearing or proceeding, his underlying 1995 Federal income tax liability is not properly at issue in this case. Goza v. Commissioner, 114 T.C. 176 (2000).
CONCLUSION
Because petitioner is prohibited from challenging his underlying 1995 Federal income tax liability and penalty in this proceeding, and because petitioner raises no other justiciable claim for relief in his petition, we hold that he has failed to state a claim upon which relief can be granted.
In view of the foregoing,
An appropriate order and decision will be entered for respondent.