That’s the message from Ch J Michael B. (“Iron Mike”) Thornton to poor old Renald Eichler. Ren is the lead-off hitter for 143 T. C. 2, filed 7/23/14, and he claims to be both poor and old, after his non-profit educational corporation cratered, leaving Ren in the hole for about $200K in TFRPs.
Ren submitted a proposed short-pay installment agreement, but what with coding mishaps at IRS and a lengthy mail delay, IRS sent Ren an NIL while his proposed installment agreement was under review.
Ren claims that’s a no-no under Section 6331(k)(2).
But Ch J Iron Mike isn’t having it. All Section 6331(k)(2) does is bar the levy, not the Notice of Intent to Levy (NIL). And though IRS tries arguing the installment agreement wasn’t “pending” when the NIL was sent, Ch J Iron Mike doesn’t have to go there. Pending or not pending, the bar is on the levy, not the notice.
Ch J Iron Mike brushes aside a contrary case in a footnote. “We are mindful that in Tucker v. Commissioner, T.C. Memo. 2011-67 (upholding Appeals’ rejection of an OIC), aff’d, 676 F.3d 1129 (D.C. Cir. 2012), in the ‘Background’ section of the opinion, a footnote indicated that the IRS had withdrawn a notice of intent to levy that it had issued after the taxpayer had submitted an OIC. By way of explanation, the footnote stated: ‘Section 6331(k)(1) provides for a restraint on levy while an OIC is pending, and the issuance of the notice of levy violated that restriction.’ Id., slip op. at 8 n.6. This dictum, however, did not represent a holding or a predicate to any holding in Tucker, as made explicit in the same footnote: ‘The issuance of that first levy notice (and its subsequent withdrawal) was not part of the CDP hearing or determination and is not part of the CDP appeal at issue here.’ Id. Accordingly, the dictum in Tucker concerning sec. 6331(k)(1) does not control this case.” 143 T. C. 2, at pp. 154-15 footnote 6.
Ren claims the IRM is inconsistent and that he should get the benefit of the more favorable of the two Manual provisions. Poor old Ren can’t get a break.
Ch J Iron Mike: “IRM pt. 220.127.116.11.2.8 appears in the part of the IRM that provides information and guidance to revenue officers in the collection process. It directs the IRS Collection Division to rescind notices of intent to levy in certain circumstances, one of which is when a notice of intent to levy is issued while levy action is prohibited and the taxpayer timely requests an Appeals hearing. By contrast, IRM pt. 18.104.22.168.2.2(5) (Dec. 14, 2010) states that Appeals should not rescind a notice of intent to levy that was issued during the pendency of an installment agreement, even where levy is prohibited. Petitioner argues that these two provisions are inconsistent and that we should treat IRM pt. 22.214.171.124.2.8 as controlling. We disagree. The IRM is not necessarily inconsistent in directing the Collection Division and Appeals to take different actions.”.143 T. C. 2, at p. 15. The SO who sustained the NIL was in Appeals, not Collections, so she followed the book as far as Appeals was concerned.
Besides, “…provisions of the IRM do not carry the force and effect of law or confer rights on taxpayers.” 143 T. C. 2, at pp. 14-15.(Citation omitted).
But the SO didn’t consider that Ren and Mrs Ren were old and ill, and that whatever they had in the bank was borrowed from Mrs Ren’s sister, Mrs Ren not being a party to this proceeding. So no summary judgment, and Ch J Iron Mike sends Ren back to Appeals to discuss the whole installment bit.