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taxable year does not constitute a collection action that is
subject to review under section 6330. Bullock v. Commissioner,
T.C. Memo. 2003-5. We have relied on the same distinction in a
case involving restrictions applicable to levy actions during the
pendency of an action for relief from joint and several
liability. Trent v. Commissioner, T.C. Memo. 2002-285. In
section 301.6330-1(g)(2), Q&A-G3, Proced. & Admin. Regs., the
Secretary of the Treasury has provided that offset is a nonlevy
collection activity that the IRS may take during the suspension
period provided in section 6330(e)(1). See also sec. 301.6331-
4(b)(1), Proced. & Admin. Regs.
III. Petitioners’ Defense to the Motion
Petitioners’ defense to the motion rests on two propositions
set forth in the petition: (1) In applying the overpayment to
other taxes, respondent “effected an offset”, and (2) “a levy
must be carried out to effect an offset”. They claim that,
because the offset was by levy, respondent erred in not according
them their rights under section 6330 to notice and a hearing.
They pray that, on account of such error, the Court compel
respondent to return the overpayment to them.
Petitioners argue that an offset can be effected only by
levy. They believe that we erred in Bullock v. Commissioner,
supra, in holding that offset is not a levy subject to the
provisions of section 6330. Petitioners support their argument
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