Klingenberg v. Comm'r
2012 Tax Ct. Memo LEXIS 293
Tax Ct.2012Background
- Petitioner Eldo Klingenberg, a self-employed plumber and habitual nonfiler, last filed a federal return in 1990.
- IRS prepared substitutes for 1991–1997 and 2004 under I.R.C. 6020(b) and assessed deficiencies after notices of deficiency were mailed.
- Special Agent Sherron Crowley reconstructed petitioner's income from third-party records and prepared substitutes for each year.
- Notices of deficiency for 1991–1997 were mailed by certified mail March 28, 2002; petitioner did not petition for redetermination.
- A 2008 deficiency notice for 2004 was issued, followed by NFTL and CDP hearing requests; petitioner sought a face-to-face hearing and challenged the underlying liabilities but did not provide requested information.
- The Appeals Officer denied a face-to-face hearing and deemed petitioner ineligible for collection alternatives once noncompliance with filing and information requests was established.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether petitioner received the notices of deficiency | Klingenberg did not receive deficiency notices | Notices were properly mailed to petitioner's last known address | Petitioner received the notices of deficiency |
| Whether petitioner could challenge the underlying liabilities in the 6330/6320 process | He never had a proper opportunity to dispute the liabilities | Notices were properly mailed; the underlying liability challenge is barred | Petitioner cannot challenge the underlying liabilities on these records |
| Whether the Appeals officer abused discretion denying a face-to-face CDP hearing | Requests a personal hearing and collection alternatives; information denied | No nonfrivolous issues; petitioner failed to provide requested information | No abuse of discretion in denying face-to-face CDP hearing |
| Whether a section 6673 penalty is warranted | Petitioner argues the position is not frivolous | Petitioner engaged in groundless litigation and delay | Impose a $3,000 section 6673 penalty |
Key Cases Cited
- Sego v. Commissioner, 114 T.C. 604 (2000) (presumption of regularity for properly mailed notices; burden to rebut)
- Goza v. Commissioner, 114 T.C. 176 (2000) (de novo review when underlying liability is properly at issue)
- Williams v. Commissioner, 114 T.C. 136 (2000) (frivolous positions and abuse of process considerations)
- Coleman v. Commissioner, 791 F.2d 68 (7th Cir. 1986) (no constitutional right to frivolous suits; penalties may apply)
- United States v. Zolla, 724 F.2d 808 (9th Cir. 1984) (delivery presumptions for properly mailed notices)