Michael Patrick and Debye Lee Leahy - Page 3

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               On February 14, 2007, this Court held that the $50,000 limit           
          in section 7463(f)(2) refers to the total amount of “unpaid tax”            
          (including interest and penalties)3 which the Commissioner has              
          determined to collect.  Schwartz v. Commissioner, 128 T.C. 6, 12            
          (2007).4  Respondent argues that this case cannot proceed as a              
          small tax case because the total amount of unpaid tax on the date           
          he issued the notice of determination exceeded $50,000.5                    
          Petitioners do not dispute respondent’s assertion that the                  
          aggregate unpaid tax that respondent determined to collect for              
          the years 1996 through 2000 exceeded $50,000 on the date of                 
          respondent’s notice of determination.  Nevertheless, petitioners            
          argue that a section 6330 collection case may be conducted under            
          the small tax case procedures of section 7463(f)(2) when the                
          amount of the underlying tax liability “in dispute” is less than            
          $50,000.  In their petition, they agree to $20,000 of the                   
          underlying tax liability.  Petitioners argue that the remaining             
          amount of the underlying tax liability, which they dispute, is              

               3 Sec. 7463(f)(2) refers to the amount of “unpaid tax” in a            
          sec. 6330 collection case.  Any reference in the Internal Revenue           
          Code to “tax” (with exceptions not applicable to this case) shall           
          be deemed to include interest and penalties.  Secs. 6601(e)(1),             
          6665(a); Schwartz v. Commissioner, 128 T.C. 6, 8 table n.1                  
               4 The fact that the unpaid tax for each individual year did            
          not exceed $50,000 was held to be irrelevant.  Schwartz v.                  
          Commissioner, supra at 12.                                                  
               5 Respondent alleges that the amount of unpaid tax on the              
          date of the notice of determination was $61,397.54.                         

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