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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
(2007).
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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Last modified: November 10, 2007