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Nimmo v. Commissioner (T.C. Memo. 2020-72)

On June 1, 2020, the Tax Court issued a Memorandum Opinion in the case of Nimmo v. Commissioner (T.C. Memo. 2020-72). The sole issue before the court in Nimmo was whether the IRS abused its discretion in sustaining the collection action against petitioner, who failed to attend (call into) his initial CDP hearing, failed to submit required documentation at his subsequent CDP hearing (on another tax period), and otherwise failed to communicate with the IRS during the collection and appeal process.

No Documents, No Estimated Tax Payments – No Collection Alternative

A taxpayer at a CDP hearing may propose a collection alternative (e.g., an installment agreement or offer in compromise). If, however, the petitioner merely mentions interest in one, but makes no concrete proposal, the IRS is not obligated to make one for him. See Gentile v. Commissioner, T.C. Memo. 2013-175, aff’d, 592 F. App’x 824 (11th Cir. 2014); Veneziano v. Commissioner, T.C. Memo. 2011-160.

In Nimmo, the IRS gave petitioner numerous opportunities, during two separate CDP hearings, to submit financial information that would enable the IRS to evaluate petitioner’s ability to pay and, consequently, his eligibility for a collection alternative. Petitioner promised but failed to submit this information. The IRS (unlike an unrequited lover) need not wait indefinitely for the taxpayer (true love) to submit requested documents (return on the morrow). See, e.g., McMurtry v. Commissioner, T.C. Memo. 2019-22; Samaniego v. Commissioner, T.C. Memo. 2019-7. In Nimmo, the IRS was patient, but their patience wore off at the two-months-post-deadline mark. Closing the petitioner’s case at that point was, therefore, not an abuse of the IRS’s discretion.

Just like failing to submit “required” documents that the IRS practically begged the petitioner to provide, failing to file returns or to be current on estimated tax payments are two more of the IRS’s “buttons” in collection actions. If a petitioner is not current on his estimated tax payments or has required returns that have not been filed, the IRS may – without any abuse of discretion, whatsoever – politely tell the petitioner to get serious about life and don’t come back until he’s ready to make better choices. See Giamelli v. Commissioner, 129 T.C. 107, 111-12 (2007); Starkman v. Commissioner, T.C. Memo. 2012-236; see also IRM 5.14.1.4.2(19).

(T.C. Memo. 2020-72) Nimmo v. Commissioner

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