Once again, nonreporteurs are balked from The Glasshouse in the City of the Unrepresented Taxed. Ex-Ch J Maurice B (“Mighty Mo”) Foley lays the bad news on Stephen C. Jenner and Judy A. Jenner, 163 T. C. 7, filed 10/22/24. Steve and Judy have their Social Security yanked to cover their nonreportage.

Their trusty attorney is in there pitching, but ex-Ch J Mighty Mo sends him to the clubhouse.

“Petitioners contend that the letter they received from the IRS notifying them that they did not qualify for a CDP hearing provided the requisite determination pursuant to section 6330(d)(1) to invoke this Court’s jurisdiction; ‘nothing in I.R.C. § 6330 limits the CDP procedures to Title 26 liabilities;’ the administrative offsets on their Social Security benefits are ‘levies by the Secretary’ that entitled them to a CDP hearing; and there is no ‘rational distinction’ between levies by the Secretary to collect Title 26 liabilities and levies to collect FBAR penalties. They conclude that ‘the CDP procedures in I.R.C. § 6330 apply to any type of liability . . . to the extent the Secretary files a lien or intends to levy.’

“These contentions are specious.” `163 T. C. 7, at p. 4.

The magic words in Section 6330(a) are “unpaid tax.” FBAR penalties aren’t a tax; they aren’t even found in 26 USC, but in 31 USC.

“In short, Title 31 expressly provides the assessment and collection procedures for FBAR penalties, and there is no statutory, regulatory, or judicial authority providing that these penalties are subject to sections 6320 and 6330.” 163 T. C. 7, at p. 5.

No tax, no CDP.