from the Commissioner of Internal Revenue (CIR No. 5388-13L)
H. Becraft, Jr., Huntsville, Alabama, for
A. Bradley, U.S. Department of Justice, Washington, D.C.
(Caroline D. Ciraolo, Acting Assistant Attorney General, and
Bruce R. Ellisen, U.S. Department of Justice, Washington,
D.C., with her on the brief), for Respondent-Appellee.
MATHESON, BALDOCK, and MORITZ, Circuit Judges.
MORITZ, Circuit Judge.
the Internal Revenue Service notified James Cropper of its
intent to collect unpaid taxes by levying his property,
Cropper requested a collection due process (CDP) hearing with
the IRS Office of Appeals. The Office of Appeals determined
that the IRS could proceed with the proposed levy. Cropper
sought judicial review, and the United States Tax Court
sustained the Office of Appeals' determination. Because
we agree with the Tax Court that the Office of Appeals
didn't abuse its discretion in determining that the IRS
could proceed with the levy, we affirm.
in order to place the relevant facts in context, we find it
helpful to summarize the statutory and regulatory context in
which the facts developed.
has authority to collect a tax by levying the property of a
taxpayer who fails, within 10 days of receiving a notice and
demand, to pay the tax owed. 26 U.S.C. § 6331(a). Before
exercising that authority, the IRS must notify the taxpayer
of (1) the IRS' intent to levy the property, see
id. § 6331(d)(1), and (2) the taxpayer's right
to a CDP hearing, see id. § 6330(a)(1).
CDP hearing,  a taxpayer may raise "any relevant
issue relating to the unpaid tax or the proposed levy
including-(i) appropriate spousal defenses; (ii) challenges
to the appropriateness of collection actions; and (iii)
offers of collection alternatives." Id. §
6330(c)(2)(A). The taxpayer may also challenge "the
existence or amount of the underlying tax liability for any
tax period if the person did not receive any statutory notice
of deficiency for such tax liability or did not otherwise
have an opportunity to dispute such tax liability."
Id. § 6330(c)(2)(B).
of the CDP hearing, the Office of Appeals must "obtain
verification from the [IRS] that the requirements of any
applicable law or administrative procedure have been
met." Id. § 6330(c)(1). And it must
consider that verification in determining whether the IRS can
proceed with a proposed levy. Id. §
6330(c)(3)(A). Additionally, the Office of Appeals must
consider the issues raised by the taxpayer, and "whether
any proposed collection action balances the need for the
efficient collection of taxes with the legitimate concern of
the person that any collection action be no more intrusive
than necessary." Id. § 6330(c)(3)(B)-(C).
the CDP hearing, the Office of Appeals issues a Notice of
Determination. Treas. Reg. § 301.6330-1(f). In the
Notice, the Office of Appeals details its findings and
decisions on all matters it considered in the hearing; sets
forth any agreements it made with the taxpayer, any relief it
provided to the taxpayer, and any future actions required
from the taxpayer or the IRS; and advises the taxpayer of his
or her right to seek judicial review by timely filing a
petition in the Tax Court. Treas. Reg. §
301.6330-1(e)(3), Q&A (E8); see also 26 U.S.C.
§ 6330(d)(1) (permitting taxpayer to petition Tax Court
for review "within 30 days of a [Notice of]
determination"). The Tax Court reviews the Office of
Appeals' administrative "determination[s]-including
the verification that 'the requirements of any applicable
law or administrative procedure have been met'-for abuse
of discretion." Meyer v. Comm'r, 106 T.C.M.
(CCH) 599, 2013 WL 6169420, at *4 (2013). If the validity of
the underlying tax liability is properly at issue in the CDP
hearing, the Tax Court reviews that issue de novo. Craig
v. Comm'r, 119 T.C. 252, 260 (2002).
that framework in mind, we turn to the facts of this case.
Cropper didn't file federal income tax returns for tax
years 2006, 2007, or 2008. The IRS prepared substitute
returns for each tax year and mailed three separate
deficiency notices via certified mail to Cropper's last
known address, a post office box in Norwood, Colorado. After
Cropper failed to respond to the deficiency notices, the IRS
assessed tax liabilities against Cropper for each of the
three tax years. The IRS subsequently mailed Cropper (1) a
lien notice, dated October 6, 2011, informing him that his
property was subject to a federal tax lien; and (2) a levy
notice, dated May 7, 2012, informing him of its intent to
levy his property.
response to the levy notice, Cropper timely requested a CDP
hearing. A settlement officer with the Office of Appeals
informed Cropper of a scheduled telephone CDP hearing on
September 20, 2012. Before the scheduled hearing, the
settlement officer obtained documents from the IRS, reviewed
Cropper's IRS account transcripts, verified that the IRS
followed all applicable administrative and legal procedures
before proceeding with the proposed levy, confirmed that the
IRS sent all required notices to Cropper's Norwood
address, and determined that the tax assessments were
Cropper subsequently failed to participate in the scheduled
telephone CDP hearing and didn't respond to the
officer's requests to reschedule it, the officer informed
Cropper that she would conduct the CDP hearing through
written correspondence. Over the next two months, Cropper
responded to the officer's letters by asserting that he
never received the deficiency notices and never had an
opportunity to challenge the underlying tax liabilities. But
Cropper failed to submit any documents the officer requested
for purposes of the CDP hearing, any ...