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6654, and 6655 additions to tax which are unrelated to a
deficiency, respondent may assess the liability without first
issuing a notice of deficiency. Sec. 6665(b); see also sec.
6672(a) (trust fund fraud recovery penalty); sec. 6694 (income
tax return preparer penalty); sec. 6205(b) (employment taxes).
In each of these contexts there is no prescribed process for
prepayment judicial review provided by the Code.8 Thus, a
taxpayer faced with such a liability must first pay the
liability, or a divisible portion thereof, before seeking court
review in a refund action. See Flora v. United States, 362 U.S.
145 (1960) (recognizing exception to requirement of full payment
before refund suit for divisible taxes where taxpayer may pay tax
attributable to one event and then file suit for refund); see
also sec. 6694(c) (allowing suit for refund of tax return
preparer penalty upon payment of 15 percent of the penalty).
Thus, to hold that every taxpayer is entitled to litigate
his underlying nondeficiency liability once a collection action
is initiated would only encourage a taxpayer to wait until a
8In the context of abatements of additions to tax, such as
those at issue here, prepayment judicial review is restricted by
sec. 6404(b), which provides that “No claim for abatement shall
be filed by a taxpayer in respect of an assessment of any tax
imposed under subtitle A or B.” In contrast, where Congress
desired to allow prepayment judicial review of interest, it has
made this intention clear. Sec. 6404(h) (“The Tax Court shall
have jurisdiction over any action brought * * * to determine
whether the Secretary’s failure to abate interest under this
section was an abuse of discretion”); see also Urbano v.
Commissioner, 122 T.C. 384, 392-395 (2004).
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Last modified: November 10, 2007