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jgordosea
jgordosea, Enrolled Agent
Category: Tax
Satisfied Customers: 3161
Experience:  I've prepared all types of taxes since 1987.
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O.K.,lets see what you got.I have been determined by the Ogden

Customer Question

O.K.,lets see what you got.I have been determined by the Ogden Utah campus as a frivolous non filer.I was "assessed" a $5000.00 penalty.The trouble is I have the form 4340,certificate of assessments and payments,and a balance of 0.00.A lien was filed without a valid lawful assessment.I know the IRM,and the 6209 manual very well and I know for a fact there was not a lawful assessment and that penalties are assessed in the same manner as taxes as per section 6671(a) of the code.The service claims the RACS 006 is the assessment and is signed by the assessment officer.I sent a FOIA for the assessment officers pertinent info and she is in fact a program manager and her GS level is 02,with no pocket commission.The ogden campus then went on to make a 6020(b) return.As is well evidenced in the IRM this type of return is for business master file as can be seen in the IRM at 5.1.11.6.7.I am not in business.The truth would be nice.
Submitted: 7 years ago.
Category: Tax
Expert:  jgordosea replied 7 years ago.

Greetings,

 

TITLE 26 > Subtitle F > CHAPTER 68 > Subchapter B > PART I > § 6703 :

"(b) Deficiency procedures not to apply

Subchapter B of chapter 63 (relating to deficiency procedures) shall not apply with respect to the assessment or collection of the penalties provided by sections 6700, 6701, and 6702. "

 

So, Congress wrote the law so that, unlike the collection of income tax, the penalties under sections 6700,6701 and 6702 do not require the same deficiency procedures.

 

The courts have upheld the ability of Congress to "enact legislation authorizing the Executive Branch to assess and collect taxes without prior administrative or judicial review so long as an adequate opportunity is afforded for a later judicial determination of liability."

 

See Kahn v. United States, 753 F.2d 1208, 1217-22 (3rd Cir.1985).

"Of course the fundamental requirement of due process is the opportunity to be heard at a meaningful time and in a meaningful manner but the concept is flexible, calling for procedural protection as dictated by the particular circumstance. Morrissey v. Brewer, 408 U.S. 471, 481, 92 S.Ct. 2593, 2600, 33 L.Ed.2d 484 (1972). In the tax context, the constitutionality of a scheme providing for only post-assessment judicial review is well-settled. Congress has long been empowered to enact legislation authorizing the Executive Branch to assess and collect taxes without prior administrative or judicial review so long as an adequate opportunity is afforded for a later judicial determination of liability. See, e.g., Bob Jones University v. Simon, 416 U.S. 725, 746-47, 94 S.Ct. 2038, 2050-51, 40 L.Ed.2d 496 (1974); Mitchell v. W.T. Grant Co., 416 U.S. 600, 611, 94 S.Ct. 1895, 1902, 40 L.Ed.2d 406 (1974); Bull v. United States, 295 U.S. 247, 259-260, 55 S.Ct. 695, 699-700, 79 L.Ed. 1421 (1935); Phillips v. Commissioner, 283 U.S. 589, 595, 51 S.Ct. 608, 611, 75 L.Ed. 1289 (1931). And, in considering prior due process objections to tax collection, the Supreme Court has shown special deference to the manner in which the IRS has collected the revenues of the government. "

 

See also Sisemore v. United States of America and Internal Revenue Service 797 F.2d 268

"The Courts have uniformly rejected plaintiffs' arguments attacking the constitutionality of 26 U.S.C. Sec. 6702 and its requirement to pay the penalty-assessment without prior notice before judicial review becomes available. Hudson v. United States, 766 F.2d 1288, 1291-92 (9th Cir.1985); Jolly v. United States, 764 F.2d 642, 644-47 (9th Cir.1985); Wardell v. United States, 757 F.2d 203, 205 (8th Cir.1985) (per curiam); Anderson v. United States, 754 F.2d 1270, 1272 (5th Cir.1985) (per curiam); Kahn v. United States, 753 F.2d 1208, 1217-22 (3rd Cir.1985)."

 

It is possible to have a penalty and there to be zero income tax assessed on the taxpayer. The procedures required to assess and collect the penalty are different, according to law, than what is required to collect taxes.

 

§ 6321. Lien for taxes :

"If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount (including any interest, additional amount, addition to tax, or assessable penalty, together with any costs that may accrue in addition thereto) shall be a lien in favor of the United States upon all property and rights to property, whether real or personal, belonging to such person. "

 

Please note that section 6321 refers to "assessable penalty" in order for the lien to arise by statute.

 

I hope this helps you to understand that Congress has written the law so that a penalty under section 6702 is not required to follow the deficiency procedures in Subchapter B of chapter 63 and that the lien arises by law on any assessable penalty under section 6321.

 

Thank you.