Unprepared TP Goes To Court

[Mr. Mephistopheles]

Now that all of Sybil's suppositions have been shown to be totally wrong, he will persist in flogging his totally dead horse, probably by quoting a founding father.

The only question that remains is will it be Hamilton, Madison, or Jefferson?

[Nikki]

Now that all of Sybil's suppositions have been shown to be totally wrong, he will persist in flogging his totally dead horse, probably by quoting a founding father.

Somewhat unfair.

Although Steve's questions were lightly dusted with his particular brand of KoolAid, they were legitimate questions based on a lack of understanding of specific laws and regulations, their general impact on the progress of a tax issue through the system, and their specific impact on the case at hand.

Now that the questions have received simple, straightforward answers, there should be no need for any flogging, except possibly to opine as to the general unfairness of the laws, regulations, and procedures.

[Mr. Mephistopheles]

No, he ignored his opportunity. The opportunity to dispute his tax liability is BEFORE the notice of intent to levy is issued. He may dispute his tax liability under this section if he did not receive a notice of deficiency or if he was not given the opportunity to petition the tax court to dispute the deficiency. He was issued a notice of deficiency and he was given 90 days to petition the tax court as required under § 6212 and § 6213.

I can verify from first hand experience that opportunity is given in writing by the IRS before a notice of intent to levy is issued. I assumed the bookkeeping duties for a company whose previous bookkeeper had fallen behind on 941 filings and deposits, as well as a host of other things. We received notice of the deficiency and given ample opportunity to make corrections before any further action was taken. It was clearly stated in the notices how to challenge the accuracy of the amount due. IIRC, there were even warnings in the notices warning of the possibility of liens or levys if the matter wasn't cleared up. Returns filed, deposits paid -unfortunately with a large amount of penalties- no liens, levys, or court appearances. Each time I spoke

[LPC]

Now that all of Sybil's suppositions have been shown to be totally wrong, he will persist in flogging his totally dead horse, probably by quoting a founding father.

Somewhat unfair.

Although Steve's questions were lightly dusted with his particular brand of KoolAid, they were legitimate questions based on a lack of understanding of specific laws and regulations, their general impact on the progress of a tax issue through the system, and their specific impact on the case at hand.

Sybil's questions displayed his typical lack of reading skills, ignorance of the law, and presumption of governmental venality.

Now that the questions have received simple, straightforward answers, there should be no need for any flogging, except possibly to opine as to the general unfairness of the laws, regulations, and procedures.

Actually, I don't think anyone addressed his exact question, which is why the statute refers to a lack of statutory notice OR other lack of an opportunity to contest the tax. Sybil presumed that the use of the disjunctive meant that it was possible to get a notice of deficiency and still not have an opportunity to contest the tax, which ignores the use of the word "otherwise."

The better answer to his question is that there are situations in which no notice of deficiency is required. I have seen at least two:

1. The IRS assesses a frivolous return penalty and then proceeds to collect the tax by levy. No notice of deficiency is required to assess the penalty and, because the taxpayer has not had an opportunity to contest the penalty, the taxpayer can challenge the imposition of the penalty as part of the collection due process hearing and appeal adverse determinations to the Tax Court. Callahan v. Commissioner, 130 T.C. No. 3, Docket No. 5701-07L (2/5/2008) (IRS motion for summary judgment denied).

2. The taxpayer files a return but does not pay the tax in full, then files an amended return reducing the liability, and the IRS issues a notice of intent to levy to collect the amount of tax shown on the original return. Because the taxpayer has not an any opportunity to challenge the amount of tax owed, the amount of tax owed can be addressed in a collection due process hearing. Montgomery v. Commissioner, 122 T.C. 1 (2004) (IRS motion for summary judgment denied).

[SteveSy]

No, he ignored his opportunity. The opportunity to dispute his tax liability is BEFORE the notice of intent to levy is issued. He may dispute his tax liability under this section if he did not receive a notice of deficiency or if he was not given the opportunity to petition the tax court to dispute the deficiency. He was issued a notice of deficiency and he was given 90 days to petition the tax court as required under § 6212 and § 6213.

Maybe so, maybe he totally ignored the IRS up to the point of a levy. I doubt it though, but the record isn't clear if he wrote any letters prior.

I guess my question is, does a person have a right to have a CDP hearing challenging the underlying liability or the appropriateness of the collection action prior to a notice of deficiency. Of course the collection action would be inappropriate if you didn't owe the tax and it would also be inappropriate if the IRS failed to follow administrative rules and regulations. It looks to me like you do get a hearing. Maybe I'm wrong and someone can explain why.

It appears the IRS can simply ignore you through the entire process, issue a notice of deficiency and your only opportunity is to head to Tax court which could be hundreds of miles away. It is my understanding the CDP hearing is to make it fair and equitable for the taxpayer so that they can resolve issue prior to it going to court. In short to keep the IRS from simply running you over and ignoring you.

btw, I've seen the IRS run someone over. I had a friend repeatedly try and explain to the IRS that 1099's issued were invalid. He followed all the steps and sent in corrections but the company that had issued them had gone out of business through the process. He ended up paying a lien of nearly $5000.00 to get it over with. The IRS ignored him all they way through even though he repeatedly requested to have a CDP hearing. He was sure it would get resolved so there was no need to head to court, he was wrong. It was a simple error on the part of the company he worked for. Maybe he should have went to court, maybe not but the IRS does run over some people.

[Nikki]

I guess my question is, does a person have a right to have a CDP hearing challenging the underlying liability or the appropriateness of the collection action prior to a notice of deficiency. Of course the collection action would be inappropriate if you didn't owe the tax and it would also be inappropriate if the IRS failed to follow administrative rules and regulations. It looks to me like you do get a hearing. Maybe I'm wrong and someone can explain why.

Other than a few exceptions, such as Dan mentioned above, a person can't have a CDP hearing until he has received a notice of deficiency (NoD), has failed to challenge the notice in Tax Court, and the statutory time for him to do so has elapsed.

Remember, the hearing relates to collection. In almost every situation, the IRS can't institute the collection process until those steps have been completed.

If, for some reason, the person is notified of a collection action without having received a NoD, he can request a CDP hearing to challenge the underlying deficiency since he never had a chance to challenge it before.

[SteveSy]

I guess my question is, does a person have a right to have a CDP hearing challenging the underlying liability or the appropriateness of the collection action prior to a notice of deficiency. Of course the collection action would be inappropriate if you didn't owe the tax and it would also be inappropriate if the IRS failed to follow administrative rules and regulations. It looks to me like you do get a hearing. Maybe I'm wrong and someone can explain why.

Other than a few exceptions, such as Dan mentioned above, a person can't have a CDP hearing until he has received a notice of deficiency (NoD), has failed to challenge the notice in Tax Court, and the statutory time for him to do so has elapsed.

Remember, the hearing relates to collection. In almost every situation, the IRS can't institute the collection process until those steps have been completed.

If, for some reason, the person is notified of a collection action without having received a NoD, he can request a CDP hearing to challenge the underlying deficiency since he never had a chance to challenge it before.

And that appears to be the courts position also....Maybe congress ought to update the law to reflect this because as it currently stands it says nothing of the sort. Thanks...

btw, if you read some of the material concerning the Taxpayer Bill of Rights it wasn't the intention of congress to boil the entire CDP process down to how much you were going to pay, if you had a spousal defense or if you hadn't received a NoD with no chance except to petition tax court to argue your liability or the appropriateness of the collection. The CDP hearing was to give the taxpayer a fair chance to discuss issues with the IRS on a one to one basis and not get run over.

Thanks for your responses.

[The Observer]

btw, if you read some of the material concerning the Taxpayer Bill of Rights it wasn't the intention of congress to boil the entire CDP process down to how much you were going to pay, if you had a spousal defense or if you hadn't received a NoD with no chance except to petition tax court to argue your liability or the appropriateness of the collection. The CDP hearing was to give the taxpayer a fair chance to discuss issues with the IRS on a one to one basis and not get run over.

Thanks for your responses.

A better clarification was that the CDP Process was to provide the taxpayer to discuss alternative ways of resolving or paying the liability than what may have been proposed by the IRS. The intent was to address situations where the taxpayer may have felt that the revenue officer was being too stringent with setting a certain dollar figure for a payment agreement or was making harsh demands in regards to liquidation of assets or accounts. The CDP was never intended to allow the taxpayer to contest the liability and rehash the whole issue over frivolous arguments such as whether "sovereign citizens" are liable for the income tax.

[The Operative]

Other than a few exceptions, such as Dan mentioned above, a person can't have a CDP hearing until he has received a notice of deficiency (NoD), has failed to challenge the notice in Tax Court, and the statutory time for him to do so has elapsed.

Remember, the hearing relates to collection. In almost every situation, the IRS can't institute the collection process until those steps have been completed.

If, for some reason, the person is notified of a collection action without having received a NoD, he can request a CDP hearing to challenge the underlying deficiency since he never had a chance to challenge it before.

And that appears to be the courts position also....Maybe congress ought to update the law to reflect this because as it currently stands it says nothing of the sort. Thanks...

I disagree. While Nikki's explanation is very brief, it does reflect the law as it is today.

[SteveSy]

btw, if you read some of the material concerning the Taxpayer Bill of Rights it wasn't the intention of congress to boil the entire CDP process down to how much you were going to pay, if you had a spousal defense or if you hadn't received a NoD with no chance except to petition tax court to argue your liability or the appropriateness of the collection. The CDP hearing was to give the taxpayer a fair chance to discuss issues with the IRS on a one to one basis and not get run over.

Thanks for your responses.

A better clarification was that the CDP Process was to provide the taxpayer to discuss alternative ways of resolving or paying the liability than what may have been proposed by the IRS. The intent was to address situations where the taxpayer may have felt that the revenue officer was being too stringent with setting a certain dollar figure for a payment agreement or was making harsh demands in regards to liquidation of assets or accounts. The CDP was never intended to allow the taxpayer to contest the liability and rehash the whole issue over frivolous arguments such as whether "sovereign citizens" are liable for the income tax.

I agree if the person is claiming they're shape shifting lizards the hearing is fruitless but the law simply does not give the IRS the ability to say "I see you're contesting your liability to amount of tax we suggest and that we didn't follow correct administrative procedures to assess the tax but we feel its a waste of our time so you don't get a hearing."

[SteveSy]

Other than a few exceptions, such as Dan mentioned above, a person can't have a CDP hearing until he has received a notice of deficiency (NoD), has failed to challenge the notice in Tax Court, and the statutory time for him to do so has elapsed.

Remember, the hearing relates to collection. In almost every situation, the IRS can't institute the collection process until those steps have been completed.

If, for some reason, the person is notified of a collection action without having received a NoD, he can request a CDP hearing to challenge the underlying deficiency since he never had a chance to challenge it before.

And that appears to be the courts position also....Maybe congress ought to update the law to reflect this because as it currently stands it says nothing of the sort. Thanks...

I disagree. While Nikki's explanation is very brief, it does reflect the law as it is today.

Reflects the law as the court has interpreted it or as its written? If as its written please cite the section that gives the IRS the ability to disregard requests to CDP hearings if the taxpayer is contesting his liability or the appropriateness of the collection action.

Here is the relevant section of law...please point it out, I have issues reading super secret text hidden between the lines.

(c) Matters considered at hearing
In the case of any hearing conducted under this section -
(1) Requirement of investigation
The appeals officer shall at the hearing obtain verification
from the Secretary that the requirements of any applicable law or
administrative procedure have been met.
(2) Issues at hearing
(A) In general
The person may raise at the hearing any relevant issue
relating to the unpaid tax or the proposed levy, including -
(i) appropriate spousal defenses;
(ii) challenges to the appropriateness of collection
actions; and
(iii) offers of collection alternatives, which may include
the posting of a bond, the substitution of other assets, an
installment agreement, or an offer-in-compromise.
(B) Underlying liability
The person may also raise at the hearing challenges to the
existence or amount of the underlying tax liability for any tax
period if the person did not receive any statutory notice of
deficiency for such tax liability or did not otherwise have an
opportunity to dispute such tax liability.
(3) Basis for the determination
The determination by an appeals officer under this subsection
shall take into consideration -
(A) the verification presented under paragraph (1);
(B) the issues raised under paragraph (2); and
(C) whether any proposed collection action balances the need
for the efficient collection of taxes with the legitimate
concern of the person that any collection action be no more
intrusive than necessary.
(4) Certain issues precluded
An issue may not be raised at the hearing if -
(A) the issue was raised and considered at a previous hearing
under section 6320 or in any other previous administrative or
judicial proceeding; and
(B) the person seeking to raise the issue participated
meaningfully in such hearing or proceeding.

btw, notice it says matters at the hearing, there is nothing allowing the IRS to not have a hearing at all. Actually it doesn't matter, the courts can make up any rules they like in favor of the government whether they like. They like you, assume they are the law regardless of what is written.

[The Operative]

Reflects the law as the court has interpreted it or as its written? If as its written please cite the section that gives the IRS the ability to disregard requests to CDP hearings if the taxpayer is contesting his liability or the appropriateness of the collection action.

As it is written. First, IN THIS CASE, the taxpayer had been given the statutory opportunity to challenge his deficiency. The issues the taxpayer raised in his response were challenges to the deficiency and according to § 6330 (c)(2)(B) he cannot raise that issue at a CDP hearing.

The person may also raise at the hearing challenges to the existence or amount of the underlying tax liability for any tax period if the person did not receive any statutory notice of deficiency for such tax liability or did not otherwise have an opportunity to dispute such tax liability.

He receive a statutory notice of deficiency, so he can't use that excuse to challenge the underlying tax liability. He was allowed the 90 days to petition the tax court, so he was allowed the opportunity to dispute his liability. The fact that he did not take that opportunity is his mistake. The IRS followed the law, as it is written. The IRS is not required to hold a CDP hearing for this taxpayer if the only issue he is presenting is a challenge to the deficiency.

[SteveSy]

Reflects the law as the court has interpreted it or as its written? If as its written please cite the section that gives the IRS the ability to disregard requests to CDP hearings if the taxpayer is contesting his liability or the appropriateness of the collection action.

As it is written. First, IN THIS CASE, the taxpayer had been given the statutory opportunity to challenge his deficiency. The issues the taxpayer raised in his response were challenges to the deficiency and according to § 6330 (c)(2)(B) he cannot raise that issue at a CDP hearing.

The person may also raise at the hearing challenges to the existence or amount of the underlying tax liability for any tax period if the person did not receive any statutory notice of deficiency for such tax liability or did not otherwise have an opportunity to dispute such tax liability.

He receive a statutory notice of deficiency, so he can't use that excuse to challenge the underlying tax liability. He was allowed the 90 days to petition the tax court, so he was allowed the opportunity to dispute his liability. The fact that he did not take that opportunity is his mistake. The IRS followed the law, as it is written. The IRS is not required to hold a CDP hearing for this taxpayer if the only issue he is presenting is a challenge to the deficiency.

Ok, but what about prior to a notice of deficiency? Am I missing something? Where does it say he has no opportunity prior to receiving an NoD? Where does it say he can not challenge the appropriateness of the collection activity? Where does it say the IRS gets to make the determination prior to the meeting whether or not his arguments are valid concerning the appropriateness of the collection activity so they can just ignore the request? Please don't respond with how it might waste the IRS's valuable time..that's not written in the law, or at least, I don't see it.

[Nikki]

Ok, but what about prior to a notice of deficiency? Am I missing something? Where does it say he has no opportunity prior to receiving an NoD? Where does it say he can not challenge the appropriateness of the collection activity? Where does it say the IRS gets to make the determination prior to the meeting whether or not his arguments are valid concerning the appropriateness of the collection activity so they can just ignore the request? Please don't respond with how it might waste the IRS's valuable time..that's not written in the law, or at least, I don't see it.

First -- the legitimate situations where the IRS institutes collection activity PRIOR to a person receiving a NoD are relatively rare as Dan pointed out above. However, there have been cases where the person never received the notice -- The IRS had an incorrect address, it was lost in the mail, etc. In those cases, although the official record shows the NoD was issued, the taxpayer can raise the non-receipt issue at the hearing. If he loses there, he can contest the determination in Tax Court. There are also procedural errors within the IRS where collection is commenced without a NoD having been sent. That, too, is a legitimate issue at a CDP hearing. Neither of those situations happened in this case.

Second -- The CDP hearing officer is permitted to restrict the hearing to arguments concerning appropriateness of the collection activity since that's the purpose of the hearing. The taxpayer must inform the hearing officer what he wants to discuss at the meeting. If the taxpayer is raising frivolous issues such as the 16th amendment is invalid or that he's not a resident of a federal zone, the hearing officer can refuse to hold the hearing. If, as was said before, the taxpayer failed to contest the NoD in Tax Court, the issue of the underlying liability can not be raised at the hearing -- The taxpayer missed his chance to do that earlier.

What I think you are missing is that (with specific exceptions such as frivolous filing penalties) the taxpayer doesn't get a notice about the availability of the CDP process until at least 90 days (150 if he's outside the country) after he receives the NoD. Those dates are the earliest that the IRS can assess the deficiency cited in the NoD and initiate collection actions.

[SteveSy]

First -- the legitimate situations where the IRS institutes collection activity PRIOR to a person receiving a NoD are relatively rare as Dan pointed out above. However, there have been cases where the person never received the notice -- The IRS had an incorrect address, it was lost in the mail, etc. In those cases, although the official record shows the NoD was issued, the taxpayer can raise the non-receipt issue at the hearing.

Unfortunately I've seen the court say it doesn't matter if they received it or not as long as the IRS has record they sent it. Also, where is it written in the law that they can't have a CDP hearing prior to an NoD or the special cases Dan mentioned?

Second -- The CDP hearing officer is permitted to restrict the hearing to arguments concerning appropriateness of the collection activity since that's the purpose of the hearing. The taxpayer must inform the hearing officer what he wants to discuss at the meeting. If the taxpayer is raising frivolous issues such as the 16th amendment is invalid or that he's not a resident of a federal zone, the hearing officer can refuse to hold the hearing.

Fair enough, but where does it say that in the law? I already know what they do currently, my question was related to written law, not judge made law or the status quo.

If it isn't written in the law and it can only be found in an opinion of a judge just say so. I promise I won't go on and on about how ridiculous I find it, its a given what I think concerning that.

btw, I appreciate the relevant responses without the personal attacks about how stupid I am.

[Lasagna]

Second -- The CDP hearing officer is permitted to restrict the hearing to arguments concerning appropriateness of the collection activity since that's the purpose of the hearing. The taxpayer must inform the hearing officer what he wants to discuss at the meeting. If the taxpayer is raising frivolous issues such as the 16th amendment is invalid or that he's not a resident of a federal zone, the hearing officer can refuse to hold the hearing.

Fair enough, but where does it say that in the law? I already know what they do currently, my question was related to written law, not judge made law or the status quo.

If it isn't written in the law and it can only be found in an opinion of a judge just say so. I promise I won't go on and on about how ridiculous I find it, its a given what I think concerning that.

Steve, come on. The purpose of the hearing is outlined in the statute. The taxpayer must, therefore, restrict the topics he wishes to discuss to those outlined in the statute. The reasons for this restriction are obvious, and I hope not debatable. A mechanism must be in place to make certain that the hearing is limited to those topics. That mechanism is a decision by the CDP hearing officer. If the taxpayer believes the officer was wrong, he can complain to the court, as the taxpayer in the first post on this thread did. The court will decide either in favor of the CDP officer or the taxpayer. I can't see how else to do it. Do you have an alternative idea, or is your thought that if a taxpayer wants to argue anything, he should be allowed to do it at any time, with no restrictions, and thus be able to absurdly drag his case out? Or is your thought that the statute limiting the topics of the CDP hearing is essentially meaningless, since the law does not explicitly provide for an impartial judge of the topic of the CDP hearing?

[The Observer]

Ok, but what about prior to a notice of deficiency?

How could one contest something that hasn't been proposed yet?

Am I missing something?

Yes

Where does it say he has no opportunity prior to receiving an NoD?

Where does it say that he has an opportunity?

Where does it say he can not challenge the appropriateness of the collection activity? Where does it say the IRS gets to make the determination prior to the meeting whether or not his arguments are valid concerning the appropriateness of the collection activity so they can just ignore the request?

Applying logic, it only follows that if a taxpayer had the opportunity to contest the proposed deficiency and failed to do so, he receives no further opportunities to do so until he pays the tax and files a claim/suit. The whole point of this rule is to keep taxpayers from forever stalling paying the bill.

Challenging the appropriateness of the collection activity is totally unrelated to challenging the basis of the liability. If TP X wants a CDP for the express purpose of saying that he disagrees with the particular method of collection that the IRS is proposing and can provide an alternative way of the tax being collected, he will get a hearing.

If the taxpayer just wants argue about his personal views of the income tax laws and how they don't apply to him, the IRS gets the right to deny him a hearing due to one of two things that happened: (1) The TP filed a timely protest to the NOD and went to court and lost, meaning his liability was upheld by the court or (2) the taxpayer failed to file a timely protest and the liability has become a fact, meaning he has lost his ability to contest the assessment. Either way, he doesn't have the right to contest the assessment.

[SteveSy]

First -- the legitimate situations where the IRS institutes collection activity PRIOR to a person receiving a NoD are relatively rare as Dan pointed out above. However, there have been cases where the person never received the notice -- The IRS had an incorrect address, it was lost in the mail, etc. In those cases, although the official record shows the NoD was issued, the taxpayer can raise the non-receipt issue at the hearing.

Unfortunately I've seen the court say it doesn't matter if they received it or not as long as the IRS has record they sent it. Also, where is it written in the law that they can't have a CDP hearing prior to an NoD or the special cases Dan mentioned?

Second -- The CDP hearing officer is permitted to restrict the hearing to arguments concerning appropriateness of the collection activity since that's the purpose of the hearing. The taxpayer must inform the hearing officer what he wants to discuss at the meeting. If the taxpayer is raising frivolous issues such as the 16th amendment is invalid or that he's not a resident of a federal zone, the hearing officer can refuse to hold the hearing.

Fair enough, but where does it say that in the law? I already know what they do currently, my question was related to written law, not judge made law or the status quo.

If it isn't written in the law and it can only be found in an opinion of a judge just say so. I promise I won't go on and on about how ridiculous I find it, its a given what I think concerning that.

btw, I appreciate the relevant responses without the personal attacks about how stupid I am.

Those dates are the earliest that the IRS can assess the deficiency cited in the NoD and initiate collection actions.

So when the IRS sends out CP 500 series letter its not an attempt to collect? I'm not trying to be a smart ass here. I just seems to me those are an attempt to collect, and fall within the appropriateness of a collection action.

[ASITStands]

CDP = Collection Due Process

Collection does NOT occur before Assessment.

NoD = Notice of Deficiency

Assessment of an income tax is "normally" not made until after a notice of deficiency has been sent to the taxpayer, and an opportunity to challenge the proposed deficiency is given, which is ONLY satisfied by the taxpayer submitting a petition to tax court.

It is NOT satisfied by the taxpayer sending any type of rebuttal or protest letter.

Most people in the tax movement somehow fail to understand procedure. There is a difference between deficiency and assessment procedures and collection procedures.

There are exceptions, which Dan has pointed out, such as when a frivolous penalty is imposed and assessed without a notice of deficiency, or opportunity to challenge.

As he states, the taxpayer would be allowed to challenge the assessment in CDP.

A frivolous penalty is imposed under IRC 6702. Section 6703(b) tells us the penalties imposed by IRC 6700, 6701 & 6702 do not fall under deficiency procedures. No NoD.

BEFORE assessment, and before a notice of deficiency, an opportunity for hearing is given by receipt of what's called the 30-Day Letter [normally, Letter 1862 or Letter 2566].

You can request an "office examination" or "field examination." See 26 CFR 601.105(b)(1). See also Pub. 5, Your Appeal Rights and How To Prepare a Protest If You Don’t Agree.

And, of course, there's Form 12203, Request for Appeals Review.

Read page 2, "Purpose of this form: You can use this form to request a review in Appeals when you receive Internal Revenue Service (IRS) proposed adjustments or other changes of $25,000 or less to a tax year questioned in the IRS letter you received with this form."

So, there is such a thing as a "hearing" BEFORE assessment, but you have to ask for it.

But, again, don't confuse a hearing BEFORE assessment and the Collection Due Process hearing which occurs AFTER assessment and BEFORE collection. Two different hearings.

I'm not blaming 'SteveSy' for not understanding procedure. Just read more closely.

Administrative Procedure, or Administrative Due Process, about which most in the tax movement know so little but about which they talk so much, is not rocket science.

You just have to keep collection procedures separate from assessment procedures. And, yes, the CP 500 Series are collection notices. They come AFTER assessment.

[SteveSy]

CDP = Collection Due Process

Collection does NOT occur before Assessment.

NoD = Notice of Deficiency

Assessment of an income tax is "normally" not made until after a notice of deficiency has been sent to the taxpayer, and an opportunity to challenge the proposed deficiency is given, which is ONLY satisfied by the taxpayer submitting a petition to tax court.

...
You just have to keep collection procedures separate from assessment procedures. And, yes, the CP 500 Series are collection notices. They come AFTER assessment.

Now I'm really confused. People always get a CP letter prior to a NoD which according to you would not be normal. Because an assessment takes place after a NoD and after CP notices.

btw, I appreciate your explanation but again I fail to see where any of that is written in the law. I can understand why the "movement" fails to understand it. Reading the plain language of the law it simply says you get a CDP hearing if you request one for the liability prior to a NoD. You may also get one if you challenge the appropriateness of the collection action, and you admit the receipt of a CP letter is a collection action. It seems to me the designation alone proves its a collection action, doesn't CP stand for "Collection Process". You get a CP 22, I think, stating they don't agree with your return or that they have changed your account based on third party information. This is one of the very first letters you get long before a NoD.