Don Mahoney - Page 7




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          If the validity of the underlying tax liability is not at issue,            
          we review the Commissioner’s determination for abuse of                     
          discretion.  Sego v. Commissioner, supra at 610.                            
               We have previously held that this Court has jurisdiction in            
          a levy proceeding instituted pursuant to section 6330(d)(1) to              
          determine whether a taxpayer’s unpaid tax liabilities were                  
          discharged in bankruptcy.  Swanson v. Commissioner, 121 T.C. 111,           
          120-121 (2003); Washington v. Commissioner, 120 T.C. 114, 120-121           
          (2003).  In Washington, we did not specifically address the                 
          appropriate standard of review to apply when determining whether            
          a taxpayer’s tax liabilities were discharged in bankruptcy where,           
          as in the matter before us, the taxpayer has not received a                 
          notice of deficiency.5  For the reasons discussed infra, our                
          review of the evidence causes us to sustain Settlement Officer              
          Clark’s determination to proceed with collection regardless of              
          whether we apply an abuse of discretion or a de novo standard of            
          review.  Petitioner bears the burden of proof.  See Rule 142(a).            
               Petitioner argued that respondent erred in applying payments           
          petitioner made pursuant to an alleged installment agreement to             
          petitioner’s 1985 tax liability because the alleged installment             
          agreement required that respondent apply petitioner’s payments to           

               5  The record does not reveal whether, in petitioner’s 1993            
          bankruptcy case, respondent submitted any proofs of claims for              
          the liabilities in issue.  Accordingly, Kendricks v.                        
          Commissioner, 124 T.C. 69 (2005), does not apply to the matter              
          before us.                                                                  





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