Peter Polanco v. Commissioner of Internal Reven

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
___________
No. 17-1649
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PETER J. POLANCO,
Appellant
v.
COMMISSIONER OF INTERNAL REVENUE
____________________________________
On Appeal from the United States Tax Court
(Tax Ct. No. 23632-15)
Tax Court Judge: Richard T. Morrison
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Submitted Pursuant to Third Circuit LAR 34.1
September 22, 2017
Before: RESTREPO, SCIRICA and FISHER, Circuit Judges
(Opinion filed September 22, 2017 )
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OPINION*
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PER CURIAM
Peter Polanco, proceeding pro se, appeals an order of the United States Tax Court
determining a tax deficiency and penalty owed to the Internal Revenue Service (“IRS”).
*
This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not
constitute binding precedent.
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For the reasons that follow, we will affirm the judgment of the Tax Court.
Polanco filed a joint federal income tax return for the tax year 2013. It is
undisputed that Polanco did not report income he received in the amount of $149,062.
On June 22, 2015, the IRS issued a notice of deficiency to Polanco and his wife. The
notice set forth a deficiency of $28,864 and a penalty of $5,103. Polanco filed a petition
challenging the notice of deficiency. He stated that the IRS had already determined that
no action was necessary with respect to his account. The Tax Court held a trial and
Polanco asserted that letters he and his wife had received from the IRS dated March 13,
2015, September 26, 2016, and September 30, 2016, precluded the IRS from issuing the
notice of deficiency.
The Tax Court upheld the deficiency and penalty. In an oral opinion, the Tax
Court explained that 26 U.S.C. § 7121 sets forth the exclusive means by which the IRS
and a taxpayer may enter into a final agreement regarding tax liability, and that IRS
regulations require such an agreement to be set forth on one of two forms. The Tax Court
ruled that the letters relied upon by Polanco did not constitute such an agreement. The
Tax Court also explained that, even if the letters were binding, it could not determine
what they mean because it did not have all of the correspondence between the IRS and
the Polancos. This appeal followed.
We have jurisdiction pursuant to 26 U.S.C. § 7482(a)(1). We review the Tax
Court’s legal conclusions de novo and its factual findings for clear error. Anderson v.
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Comm’r of Internal Revenue, 698 F.3d 160, 164 (3d Cir. 2012).
Polanco reiterates on appeal that the three letters from the IRS preclude the notice
of tax deficiency. He asserts that the letters relate to the 2013 tax year and that the matter
should not have gone to trial. We agree with the Tax Court that it is not clear what the
letters mean. The March 13, 2015 letter thanked the Polancos for correspondence
received on December 29, 2014, and stated that the IRS had reviewed the information
provided and determined that no action was necessary on their account. The letter refers
to the tax period ending December 31, 2014. The September 26, 2016 letter is addressed
to Polanco’s wife and thanked her for her inquiry of July 22, 2016. The IRS stated that it
had sent her a letter in error thanking her for information she had sent and explaining that
it would contact her, and that it had resolved the issue on her account and did not need to
take any further action. The September 30, 2016 letter is also addressed to Polanco’s
wife. This letter also responded to her July 22, 2016 inquiry and is essentially the same
as the September 26, 2016 letter. The latter two letters refer to the tax period ending
December 31, 2013.
Polanco did not provide the correspondence he and his wife sent to the IRS and
did not satisfy his burden of proving that the deficiency determination is incorrect. See
Duquesne Light Holdings, Inc. & Subsidiaries v. Comm’r of Internal Revenue, 861 F.3d
396, 403 (3d Cir. 2017) (noting taxpayer’s burden of proof). Moreover, Polanco does not
challenge on appeal the Tax Court’s conclusion that the letters do not constitute
agreements entered into under 26 U.S.C. § 7121, which authorizes the Secretary of the
Treasury to enter into a written agreement regarding taxpayer liability. See Sunik v.
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Comm’r of Internal Revenue, 321 F.3d 335, 337 (2d Cir. 2003) (agreements under § 7121
regarding taxpayer liability must be executed on forms prescribed by IRS).
Accordingly, we will affirm the
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