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draft even after he received Wells’s July 14 letter--the one
making clear that a subpoena would make Wells unavailable.
Moving quickly, Talbott on July 21 issued the official notice of
determination sustaining the notice of intent to levy, a mere
month after he had sent his first letter to Wells.
Industrial filed a timely petition in this Court and trial
was held in Los Angeles, which is near Industrial’s principal
place of business.
OPINION
The Commissioner may levy on property belonging to a
taxpayer once he gives proper notice and an opportunity for a
hearing. See secs. 6330, 6331.3 During the hearing, a taxpayer
can only challenge the existence or amount of the underlying tax
liability if he either (1) did not receive a statutory notice of
deficiency, or (2) did not otherwise have an opportunity to
dispute the liability. Sec. 6330(c)(2)(B). Industrial has had
its day in Tax Court, so it can no longer contest its liability--
it can win only if it shows that the Commissioner abused his
discretion. Sego v. Commissioner, 114 T.C. 604, 610 (2000); Goza
v. Commissioner, 114 T.C. 176, 181-182 (2000). He abuses his
discretion when he acts “arbitrarily, capriciously, or without
sound basis in fact or law.” Woodral v. Commissioner, 112 T.C.
3 Unless otherwise noted, all section references are to the
Internal Revenue Code in effect for the years at issue; all Rule
references are to the Tax Court Rules of Practice and Procedure.
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Last modified: November 10, 2007