2018 T.C. Memo. 149
T.C.2018Background
- Petitioner filed a 2008 Form 1040 reporting tax due of $2,426 and claimed Schedule C business deductions; he made voluntary payments totaling $1,757 toward that liability.
- IRS issued a notice of deficiency (claimed mailed Aug. 7, 2012) disallowing most Schedule C deductions and later assessed additional tax for 2008; petitioner says he did not receive the notice.
- IRS filed notices of Federal tax lien for 2006 and 2008; petitioner timely requested a collection due process (CDP) hearing and petitioned the Tax Court under I.R.C. §§ 6320/6330.
- After remand and supplemental proceedings, petitioner produced additional substantiation; Appeals and, later, IRS conceded that petitioner’s correct 2008 tax liability is $0 and agreed to abate the assessment and release the 2008 lien.
- Petitioner nevertheless sought a Tax Court determination that he had an overpayment for 2008 and an order directing a refund or credit; Tax Court considered whether it has jurisdiction under § 6330(d)(1) to determine and order refunds in a CDP proceeding.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Tax Court has jurisdiction under § 6330(d)(1) to determine and order credit/refund of an overpayment in a CDP case | McLane: § 6330(c)(2)(B) lets a taxpayer who didn’t receive a notice of deficiency challenge underlying liability in CDP; that should permit overpayment relief when the taxpayer never got an SNOD | Commissioner: § 6330(d) does not expressly grant overpayment/refund jurisdiction; Greene‑Thapedi controls and bars inferring such jurisdiction absent an independent statutory basis | Held: No. The Court follows Greene‑Thapedi and declines to infer overpayment/refund jurisdiction under § 6330(d)(1) absent another statutory grant |
| Whether petitioner’s nonreceipt of an SNOD creates an equitable right to revive otherwise time‑barred refund claims | McLane: Nonreceipt deprived him of the ordinary route (a timely petition to Tax Court) to preserve refund rights | Commissioner: Nonreceipt did not prevent pursuit of a refund during the limitations period; petitioner failed to assert a refund claim timely | Held: Court rejects petitioner’s equitable argument; statutes of limitation and refund procedures control |
| Whether an alternative statutory basis (e.g., § 6404(h) for interest abatement or § 6512/6214 deficiency proceedings) supplies jurisdiction to order refunds here | McLane/amicus: CDP petitions should be read to allow concurrent jurisdiction when necessary to fully resolve collection disputes | Commissioner: No independent statutory claim for refund was raised in Appeals or petition; § 6404(h) jurisdiction arises only when an interest‑abatement claim is asserted | Held: If a CDP petitioner raises a valid claim under another provision (e.g., § 6404(h) or § 6015(g)) the Court can have independent jurisdiction under that provision, but no such claim exists here |
| Whether Greene‑Thapedi should be overruled | Amicus and petitioner urged reconsideration based on remedial purpose and Board precedent | Commissioner defended Greene‑Thapedi as consistent with statutory text and limits on Tax Court overpayment jurisdiction | Held: Greene‑Thapedi affirmed; Court declines to overrule it and explains why statutory structure forecloses implied overpayment jurisdiction in § 6330(d) cases |
Key Cases Cited
- Greene‑Thapedi v. Commissioner, 126 T.C. 1 (2006) (Tax Court held § 6330(d) does not give Tax Court jurisdiction to determine/order overpayments or refunds in CDP proceedings absent an independent statutory basis)
- Wright v. Commissioner, 571 F.3d 215 (2d Cir. 2009) (2d Cir. held Tax Court has jurisdiction under § 6404(h) when interest‑abatement issues are raised in CDP proceedings)
- Gray v. Commissioner, 138 T.C. 295 (2012) (Tax Court treated a CDP petition that raised interest abatement as also invoking § 6404(h) jurisdiction)
- Naftel v. Commissioner, 85 T.C. 527 (1985) (Tax Court principle that Court must resolve all issues necessary to correct and complete redetermination when it has jurisdiction)
- King v. Commissioner, 829 F.3d 795 (7th Cir. 2016) (appellate review of Tax Court’s exercise of jurisdiction and standards for interest abatement decision)