Robert Emmett McArdle, III, Petitioner

. Memo . 2008-18 9 UNITED STATES TAX COUR T ROBERT EMMETT MCARDLE III, Petitioner v . COMMISSIONER -OF'INTERNAL REVENUE, Respondent Docket'No . 8933-07L . ' Filed August 7, 2008 .

Robert Emmett McArdle III, pro se .

Susan K . Greene , for respondent .

MEMORANDUM FINDINGS''OF FACT AND OPINIO N COHEN , Judare : This action was commenced in response to a Notice of Determination Concerning Collection Action ( s) Under Section 6320 and / or 6330 (notice of determination ) with respect to petitioner ' s 1990, 1991 , 1993 , 1994, and 1998 Federal income tax liabilities .

The issue for decision is whether the periods of limitations on collection for petitioner's 1990 and 1991 ta x SERVED A m 7 2008 2 - years have expired, making the imposed notice of Federal tax lien inappropriate with respect to those years . Unless otherwise indicated, all section references are to the Internal Revenue Code .

FINDINGS OF FACT Some of the facts have been stipulated , and the stipulated facts are incorporated in our findings by this reference .

Petitioner resided in Texas at the time his petition was filed .

Federal income tax liabilities arose because petitioner failed to pay in full the tax reported on his returns for 1990, 1991, 1994 , and 1998 .

Petitioner ' s 1993 tax return reflected a refund due .

The Internal Revenue Service ( IRS) receive d petitioner ' s 1990 return on June 12, 1992, and timely assessed the tax due on July 27, 1992 . The IRS received petitioner's 1991 return on July 1, 1992 , and timely assessed the tax due on August 3, 1992 .

The IRS audited petitioner ' s returns for 1990, 1991, and 1993 . Petitioner entered into agreements to extend the periods of limitations on assessment for these tax years .

In particular, the 1990 assessment period was extended to September, 20, 1999 , and the 1991 assessment period was extended to October 8, 1999 .

The IRS timely assessed the additional tax for 1990 on June 3 , 1996, and for 1991 on June 1 .0, 1996 .

On September 28 ; 1992,'petitibner filed'" .a chapter 13 bankruptcy petition . On March°15, . 1996, the'bankruptcy court entered an order dismissing petitioner's bankruptcy case .

Petitioner filed a second chapter 13 bankruptcy petition on September-26 ;-1996 . An order dismissing this second bankruptcy. .- .

case was entered on December 11,',"1996,.

' The IRS sent .,a Notice of .Federal Tax'Lien Filing and .Your Right to a Hearing Under IRC 6320 to petitioner on June 30 ; .2006 .

On July 10,-'2006, the IRS filed :a-notice of Federal tax-lien for petitioner'ss outstanding .--tax .liabilities for :, the years in issue Petitioner made a timely request for an administrative hearing (section-6330 hearing) regarding the-lien- On January 19, 2007,-a settlement officer held a section .

6330 hearing with petitioner, . ; Petitioner='argued that : (1) The amount"-of-the 1994 : tax : liability determined by the IRS was incorrect ; (2) the assessment dates for tax°years~1 .990 and 199 4 were 'incorrect ;- (3),the IRS .miscalculated ;thee periods of limitations on collection and -those periods had expired ; and .the notice of Federal tax lien- :should be withdrawn .

On March 1`5, ., 200.7, .the Appeals Office sent to petitioner the notice . of determination upon which this case is based . The notice of determination upheld the .=tax lien and affirmed that :

(1) The 1994 tax liability, which was determined according to the return filed by petitioner, was accurate ; (2) the assessment dates for 1990 and 1994 shown in the IRS records were correct ; (3) the periods of limitations on collection for all tax years had not passed because the IRS calculations of those periods were correct ; and (4 ) the notice of Federal tax lien should not be withdrawn because withdrawal of the lien would neither facilitate the collection of the tax liability nor be in the best interests of both the Government and petitioner .

The notice of determination concluded-that the filing of the Federal tax lien was in . conformity with IRS procedures and was necessary to protect the Government ' s interest in petitioner ' s assets .

OPINION

Although petitioner raised other arguments at various .stages of the proceedings , his argument at trial and in his posttrial brief is that the periods of limitations on collection for 1990 and 1991 have expired . He argues , therefore , that the Federal tax lien is inappropriate with . : regard to those years .

Section 6321 creates a lien in favor of the United States on all property and rights to property belonging to a person liable for taxes when payment has been demanded and neglected .

. The lien arises ,by operation of law when the IRS assesses the amount of unpaid tax . Sec . 6322 . The IRS files a,-notice of Federal tax lien to preserve priority and put other creditors on notice . See sec . 6323 .

5 - Section 6320 provides'that the'~Secretaryshall furnish the person ` described in section 6321 with written notice of the filing of a lien under section 63 . 23 . This notice must be provided not more than 5'-business-days after the day the notice of Federal tax lien is filed and must advise the taxpayer of the' opportunity for an administrative review in the form of= a hearing .' Sec' . 6320 (a) .

Section'6320 further provides that the taxpayer . may request a section 6330 hearing within - the 30 =day period , beginning on the` day after the. 5 -day` period -.

Sec . 6320 ,( a) (3) (B)` The hearing generally shall be conducted consistent with the procedures se t forth in section 6330'(c) (d), and (e') Sec . 6320(c) .

taxpayer may raise any relevant issue at the hearing , including challenges to "the appropriateness of collection actions Sec .

6330 ( c) (2) (A) (ii ) The settlement officer must ( 1) consider issues raised by the taxpayer , (2)' verify that the requirements of applicable law and administrative procedures have been met, and-,(3) consider "whether any proposed ' collect ion action balances the need for- .the efficient collection of taxes with the legitimate concern of the person [involved] that any collection action be no more intrusive than necessary ." Sec . 6330(c) (3)' .' ; The notice of . determination in this case reflects that all the required steps were taken .

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6 - We have jurisdiction to review the Appeals Office determination with respect to a section 6330 hearing . Secs .

6320 ( c), 6330 ( d)(1) ; see Greene - Thapedi v . Commissioner , 126 T .C .

1, 6 (2006 ) .

Petitioner contends that the periods of limitations for the collection of his 1990 and 1991 Federal income tax liabilities have expired .

We review this particular matter de novo . See Boyd v . Commissioner , 117 T . C . 127, 130 (2001) ; MacElvain v . Commissioner , T .C . Memo . 2000-320 ( explaining-that a claim that the limitations period has expired constitutes a challenge to the underlying tax liability ) .

For reasons discussed below, we conclude that they did . not .

After a return is filed , the IRS generally . is limited to-3 years to assess the amount of tax imposed ; i .e ., the period . of limitations on assessment .

Sec . 6501 ( a) . The period of limitations on assessment may be extended if the IRS and the .

taxpayer agree to an extension in writing .

Sec . 6501 (c)(4) .

Where the .assessment of any tax has been properly made within the period of limitations on assessment , the IRS may collect the tax within 10 years after the date , of the assessment ; i .e ., the period of limitations for collection after assessment .

Sec .

6502 ( a) (1) .

Statutory periods of limitations may be suspended during any time . that the IRS is prohibited from assessing or collecting tax, such as during the pendency of certain court proceedings, section 6330 hearings, bankruptcy proceedings, and, installmen t agreements .

Secs . 6320(c), 6330(e)(1), 6331(k) (3) (B) , '6502,(a) , 6503 (a) (1) , (h) .' 'The period :of limitations on collection is extended for an additional 6 months after 'a bankruptcy , case is .

dismissed or`discharged . Sec . 6503 (h) .(2) =.K Petitioner contends that the 10-year statutory . periods of limitations on collection,for his 1990,and .1 .951 tax years have expired .

He argues that the settlement officer-should have used a different method of calculation to determine the, .expiration .

dates . In determining, the method of . calculation that should' . be applied, petitioner relies on a special rule (Restructuring Act rule) found in section 3461(c)(2) of the Internal Revenue Service Restructuring and Reforms Act of 1998 ; Pub . L ..-105-206, 112 Stat .

764, which provides :

(2) Prior request .-- If, in any-request to extend the period of limitations made on or before December 31, : 1,999,-a taxpayerilagreed to extend such perio d beyond the 10-year period referred to . in section 6502 ( a) of the Internal Revenue Code of 1 .986, such, extension shall expire on the latest of-- (A) .the last day of such 10-year period ; (B) December 31, 2002 ; or .

(C) .in the case of an extension in connection with .an installment agreement , the 90-th day after the-end of the period of such extension .

[Emphasis added .

] Petitioner asserts that his 1990 and 1991 tax years qualify fo r treatment under this Restructuring Act rule because he had entered into agreements, before December 31, 1999, to extend the' period of limitations for both years . Petitioner argues that subsection (c)(2)(B) or (C) of the Restructuring Act' rule applies and, accordingly, should limit the periods of limitations to either December 31, 2002, or 90 days after the end of each extension agreement .

The Restructuring Act rule, however, applies .only to extensions of periods of limitations on collection . Petitioner entered into agreements to extend the periods of limitations on assessment under section 6501, not on collection under section 6502 . Thus, the Restructuring Act rule does not apply to petitioner' s case .

Petitioner's remaining argument is that the lien should be withdrawn . Insofar as the underlying tax liability is not at, issue, we review the findings from the section 6330 hearing using an abuse of discretion standard . See Sego v . Commissioner , 11 4 T .C . 604, 610'(2000) ; H . Conf . Rept . 105-599, at 266 (1998), 1998-3 C .B . 747, 1020 . For us to conclude that there was an abuse of discretion in sustaining the lien, petitioner would hav e to show that the settlement officer's determination was arbitrary, capricious, or without sound basis in fact or law .

See Giamelli v . Commissioner , 129 T .C . 107, 111 (2007) ; see also

In reviewing the settlement officers ' s calculations of the relevant periods of limitations on collection , we find no material errors . The correct assessment dates . for tax years 1990 and-1991 were used as the starting points for the calculations .

The settlement officer took into account the suspensions of the limitation periods related to bankruptcy proceedings , including the additional 6-month extensions pursuant to section 6503 ( h)(2) .

Petitioner presented neither evidence nor argument showing that , the settlement officer's computation of the periods at issue was erroneous under the method of calculation used .

We conclude that the settlement officer properly calculated the periods of limitations on collection for 1990 and 1991 and that those periods have not expired .

Taking into account all the facts and circumstances of this case, we hold that the settlement officer did not commit an error in calculating the periods of limitations or abuse his discretion in sustaining thenotice of Federal tax lien . In reaching ou r decision , we have considered all arguments made, and, to the extent not mentioned , we conclude that they are irrelevant, moot, or without merit .

To reflect the foregoing, Decision will be entered for respondent .

5. U .S .C . sec . 706(2)(A) (2006) . He has not done so here ..