In Uncategorized on 03/29/2013 at 01:29

No, not the 2007 Celine Dion album, but rather a lesson to Stanley Cohen, in 2013 T. C. Memo. 86, filed 3/28/12, taught by Judge Halpern.

Stanley was an investor (or maybe an investment; see 2013 T. C. Memo. 86, at p. 7) in a deal called Park Leasing Assoc., P’ship, whose career came to an end in 2006. But Park Leasing’s story goes back to the 1980s, so Stanley owes about $75K in tax, and a whopping $598K in accumulated interest. See my blogpost “Bang – A Warning to Tax Matters Partners (and their advisors)”, 1/5/11.

Stanley claimed the other investors got a better deal than he was offered. He raised that at an equivalent hearing (not a CDP for the tax levy he got, because Stanley sent in his request too late), and his attorney presented evidence of disparate treatment, but Appeals didn’t buy it.

Stanley tried a petition to Tax Court, but that got dismissed for want of jurisdiction.

Now someone at IRS decided to hand Stanley a NFTL, as apparently the levy didn’t get the appropriate quantities of Stanley’s hide. Stanley files the 12153, asks for a CDP and reiterates the “unequal treatment” argument.

The SO says no, you had a chance to contest the underlying liability. Stanley says, “no, I was contesting that you denied my settlement offer, which was to settle on the same terms as the other investors.”

Judge Halpern: “[SO]’s conclusion that petitioner was attempting to raise a challenge to the amount of his underlying tax liability is understandable since, on the lien hearing request form, petitioner did not identify an offer-in-compromise or other collection alternative as his reason for disagreeing with the lien notice. He claimed only that he had not been treated the same as other partners who were offered settlements. How [SO] pigeonholed the claim, however, is unimportant. To the extent petitioner was raising a liability challenge, [SO] was correct in concluding that section 6330(c)(2)(B) precluded him from doing so, since he had the opportunity to dispute his liability in response to the levy notice. To the extent he was asking to settle his liability or to compromise the interest assessments, those were the identical issues petitioner had raised during the levy hearing, and the question is one of whether sections 6320(c) and 6330(c)(4) precluded him from again raising them during the lien hearing.” 2013 T. C. Memo. 86, at pp. 13-14.

And Judge Halpern’s answer to question no. 2 hereinabove is yes, it does.

Judge Halpern: “We have held, however, that an equivalent hearing is ‘indisputably an ‘administrative * * * proceeding’ within the meaning of section 6330(c)(4)’ (and, by inference, section 301.6320-1(e)(1), Proced. & Admin. Regs.). See West v. Commissioner, T.C. Memo. 2010-250, 2010 WL 4780323, at *4. Thus, the levy hearing was at least an administrative proceeding within the meaning of section 301.6320-1(e)(1), Proced. & Admin. Regs., and there is no doubt that petitioner claimed at the levy hearing that he had not been treated the same as other partners who were offered settlements.” 2013 T. C. Memo. 86, at pp. 13-14.

And Stanley and his attorney fully aired Stanley’s objections and introduced evidence. They materially participated, and having taken their chance, are precluded from  raising that issue again.


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