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V. The Discharge in Bankruptcy Issue
Petitioners’ claim that the U.S. Bankruptcy Court for the
Southern District of New York (the Bankruptcy Court) discharged
them from their respective unpaid liabilities for 1994 and 1995
is not a challenge to the preassessment determination of the tax
but, rather, is in the nature of an affirmative defense that
petitioners could raise in any postassessment action to collect
the unpaid portion of the assessed tax from them. See, e.g.,
First Natl. Bank v. Haymes, 268 N.Y.S.2d 820, 827 (City Civ. Ct.
1996), stating: “[W]here the bankrupt is sued upon a debt[,] a
discharge in bankruptcy is a defense which must be affirmatively
pleaded by him.” Such a defense is relevant to collection of the
unpaid portion of the assessed tax and, thus, is appropriately
raised under section 6330(c)(2)(A) (but not under section
6330(c)(2)(B)).
VI. Standard of Review
Where, upon appeal from a section 6330 determination, a
challenge to the existence or amount of the taxpayer’s underlying
tax liability (i.e., a challenge to the determination of the tax
on which the Commissioner based his assessment) is properly
before us, the taxpayer is entitled to a hearing de novo and may
make a record, and we should decide that challenge in the same
manner as we would redetermine a deficiency pursuant to section
6214. In most other instances where we are asked to review a
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