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LLC Challenges IRS Collection Determination in Tax Court

SEP. 20, 2021

Green Therapeutics LLC v. Commissioner

DATED SEP. 20, 2021
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Green Therapeutics LLC v. Commissioner

[Editor's Note:

The attachments can be viewed in the PDF version of the document.

]

GREEN THERAPEUTICS LLC,
Petitioner(s)
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent.

UNITED STATES TAX COURT

PETITION FOR LIEN OR LEVY ACTION UNDER CODE SECTION 6330(d)

GREEN THERAPEUTICS LLC, a Nevada limited-liability company (the "Petitioner“), hereby petitions for a redetermination of the Notice of Determination set forth by the Commissioner of Internal Revenue (the “Commissioner") in the Commissioner's Notice of Determination Concerning Collection Actions under IRC Sections 6320 or 6330 of the Internal Revenue Code, dated August 23, 2021, and as the basis for the Petitioners' case alleges as follows:

1. The Petitioner is a Nevada limited-liability company with a principal place of business in Clark County, Nevada.

2. The Petitioner's mailing address, as of the date of this Petition, is 7250 South Durango Drive, Suite 130-178, Las Vegas, Nevada 89113.

3. The Petitioner's taxpayer identification number is not herein included pursuant to Rule 27, Tax Court Rules of Practice and Procedure.

4. The Internal Revenue Service (“IRS”) action disputed is a Notice of Determination Concerning Collection Actions under IRC Sections 6320 or 6330 of the Internal Revenue Code, dated August 23, 2021, originating from the Las Vegas, Nevada office of the IRS (the “Notice”).

5. The IRS issued the Notice on August 23, 2021, and the last day to file the instant Petition pursuant to Internal Revenue Code (“IRC”) § 6330(d)(1) is “within 30 days of [the Notice],” or September 22,2021. This Petition is therefore timely.

6. The Notice was issued with respect to: IRS Form 941 for December 2017, March 2018, June 2018, and September 2018; and IRS Form 940 for tax year 2018 (the “Employment Taxes”).

7. The Petitioner's total tax liability due and owing with respect to the Employment Taxes is Zero Dollars ($0.00).

8. The total amount of Petitioner's penalties and interest alleged to be due and owing in respect of the Employment Taxes, as of the date of the Notice according to the IRS, is One Hundred Six Thousand Two Hundred Seventy-Nine Dollars and 7/100 Cents ($106,279.07).

9. The instant matter does NOT qualify to be conducted under the SMALL TAX CASE PROCEDURE, as the amount in question is significantly greater than the $50,000 threshold.

A. First Assignment of Error — Failure to Acknowledge that Reasonable Cause Existed to Abate Penalties and/or Interest

10. Petitioner disagrees with, and hereby contests, the Commissioner's determination in the Notice with respect to Petitioner's Collection Due Process request pursuant to IRC § 6330 because Petitioner presented substantial and compelling evidence that: the Petitioner acted in good faith and had relied upon a third-party employment tax management company that defrauded Petitioner; even after being defrauded, Petitioner nonetheless paid all federal employment tax deficiencies then owing; and Petitioner has acted in good faith and substantial compliance with the IRS's appeals process.

11. Petitioner therefore hereby contends that reasonable cause exists to abate the penalties and/or interests associated with the Employment Taxes. The Commissioner's conclusion otherwise was in error.

B. Second Assignment of Error — Failure to Conduct Adequate Collections Due Process Fair Hearing

12. The IRS and Petitioner (via authorized representative) initially engaged in a Collections Due Process hearing on or about March 18,2021, which hearing lasted approximately Ninety (90) minutes before the parties mutually agreed to continue the hearing. A follow-up continuation hearing was scheduled for June 16, 2021.

13. On or about June 15, 2021 — immediately prior to the scheduled continuation hearing — the IRS appeals agent notified the Petitioner (via authorized representative) that the IRS appeals agent was suffering from an illness, and that the continuation hearing would be cancelled.

14. The IRS thereafter failed to take reasonable steps to reschedule the continuation hearing prior to issuing the Notice, and as a result, Petitioner was denied a valid Collections Due Process right to fair hearing pursuant to IRC § 6330(b).

C. Factual Assertions Supporting Assignments of Error

15. The facts upon which Petitioner rely are:

a. conclusive evidence that the Petitioner was unknowingly defrauded by a third-party, unrelated payroll tax company;

b. Petitioner nonetheless paid its total Employment Tax liability when presented with evidence that it was defrauded and no taxes were originally submitted on its behalf with respect to the Employment Tax liability;

c. Petitioner has acted with the utmost good faith in dealing with the IRS's review and appeals procedures; and

d. That the IRS cancelled a scheduled continuation Collection Due Process hearing on or about June 15,2021.

16. The Following items have been enclosed with this Petition:

a. A copy of the Notice sent by the IRS;

b. A Statement of Taxpayer Identification Number (Form 4);

c. The Request for Place of Trial (Form 5); and

d. The filing fee of sixty dollars ($60.00).

WHEREFORE, the Petitioner prays that this Court may try this case, and rule that:

A. The Commissioner and the IRS erred in denying Petitioner's Collection Due Process request pursuant to IRC § 6330 and determining that reasonable cause did not exist to abate the penalties and/or interests associated with the Employment Taxes;

B. The Petitioner is entitled to partial or complete relief from penalties and/or interest assessed with respect to the Employment Taxes;

C. The penalties and interest assessed with respect to the Employment Taxes are therefore not due and owing;

D. In the alternative, that Petitioner is entitled to another Collections Due Process hearing before the IRS due to the IRS failing to provide Petitioner with a fair hearing pursuant to IRC § 6330(b); and

E. Provide such other and further relief as the Tax Court may deem fit and proper.

DATED: This 20th day of September, 2021.

DAWSON & LORDAHL PLLC

By: Var E. Lordahl
Counsel for Petitioner
8925 West Post Road Suite 210
Las Vegas, Nevada 89148
702-476-6440
U.S. Tax Court Bar No. LV0055
Nevada Bar No. 12028

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