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liability’ as a reference to the amounts that the Commissioner
assessed for a particular tax period.” Montgomery v.
Commissioner, 122 T.C. 1, 7 (2004). Thus, “‘underlying tax
liability’ may encompass an amount assessed following the
issuance of a notice of deficiency under section 6213(a), an
amount ‘self-assessed’ under section 6201(a), or a combination of
such amounts.” Id. at 7-8.
The plain language of section 6330(c)(2)(B) bars a taxpayer
who has received a notice of deficiency from challenging his or
her underlying tax liability for that year (whether the liability
was self-assessed or assessed as a deficiency) in a collection
review proceeding inasmuch as the person was afforded a prior
opportunity to challenge such liability under the deficiency
procedures. See id. at 8. In contrast, where a person has not
received a notice of deficiency and has not had a prior
administrative or judicial opportunity to challenge the amounts
the Commissioner assessed, section 6330(c)(2)(B) provides that
such person may challenge the underlying tax liability as part of
the collection review procedure. Id.
Petitioners’ 1999 return shows a tax due to be paid.
Petitioners made no payment with respect to that tax with or
following the filing of their 1999 return. Because certain
income was omitted from petitioners’ 1999 return, respondent
issued a notice of deficiency to them for that year. After
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