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officer abuse her discretion by issuing the notice of
determination without considering the Baltics’ pending OIC-DATL
or amended 1999 return?
Section 6330(c)(2)(B) allows a taxpayer to challenge the
existence or amount of his underlying tax liability if he neither
received a notice of deficiency nor otherwise had an opportunity
to dispute it. The Baltics’ first line of attack is that they
should have been allowed to challenge their underlying liability
because section 6330(c)(2)(B)--though it allows challenges to
“the underlying tax liability for any tax period if the person
did not receive any statutory notice of deficiency”--doesn’t say
that it allows such challenges “only if the person did not
receive any statutory notice of deficiency.”
This parsing has no support in any caselaw, as the Baltics’
counsel admitted at oral argument. And we won’t be creating any
here: Congress used section 6330(c)--and only section 6330(c)--
to describe how a CDP hearing would work. We find no authority
elsewhere in the Code to read that section’s command that the IRS
allow challenges to liability in some situations to mean that the
IRS must allow challenges to liability in all situations.
The Baltics’ next sally looks more effective. They claim
that making an OIC-DATL is not a challenge to their underlying
liability. If it’s not, then it should have been considered at
the CDP hearing, because section 6330(c)(2)(A)(iii) lists OICs as
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Last modified: March 27, 2008