James L. Ball - Page 12

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            or Collections Division personnel, before issuance of a notice                              
            of deficiency or of the decision of Appeals, are not                                        
            substantially justified.                                                                    
                  Petitioner contends that the Commissioner, by improperly                              
            failing to issue a notice of deficiency before assessing tax in                             
            excess of the amount shown on the 1984 and 1985 returns, became                             
            liable for an award of administrative costs when the first                                  
            collection notice was sent to petitioner.  We disagree.  There                              
            is no authority in section 7430(c) to award administrative costs                            
            resulting from improper conduct by respondent before one of the                             
            two events stated in section 7430(c)(2) occurs.  The United                                 
            States is immune from suit except to the extent that it consents                            
            to be sued.  United States v. Sherwood, 312 U.S. 584, 586 (1941).                           
                  Petitioner relies on Huffman v. Commissioner, 978 F.2d 1139,                          
            1148-1149 (9th Cir. 1992), affg. in part, revg. in part and                                 
            remanding T.C. Memo. 1991-144 and Han v. Commissioner, T.C. Memo.                           
            1993-386.  These cases are distinguishable from the instant case                            
            because the Commissioner issued a notice of deficiency in both of                           
            those cases.                                                                                
                  Petitioner's argument is similar to that made by the                                  
            taxpayer in Estate of Gillespie v. Commissioner, 103 T.C. 395,                              
            396-397 (1994).  In Estate of Gillespie, respondent issued a 30-                            
            day letter but did not issue a notice of deficiency or notice of                            
            decision by Appeals.  We held that a 30-day letter is not a                                 





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