Vinatieri v. Commissioner

In September 2007, the commissioner (defendant) of the Internal Revenue Service (IRS) notified Kathleen Vinatieri (plaintiff) of the IRS’s intent to levy against her wages to collect Vinatieri’s tax debt. An IRS settlement officer conducted a hearing with Vinatieri in which Vinatieri stated that she could not pay any of her debt. Vinatieri also explained that she did not file a 2005 tax return because the payroll company that should have prepared her 2005 IRS Form W-2 went out of business, and that she had been unsuccessful in getting the IRS to provide her 2005 income information. At the settlement officer’s suggestion, Vinatieri submitted IRS Form 432-A indicating that she had monthly earnings and expenses of $800, $14 in cash, a car worth $300, and no other assets. The settlement officer concluded that although Vinatieri’s financial condition qualified Vinatieri’s account for placement in a currently-not-collectible (CNC) status, the IRS should deny CNC status because Vinatieri had not filed 2005 or 2007 returns. In June 2008, the commissioner notified Vinatieri that the IRS was sustaining the proposed levy and that Vinatieri was ineligible for a collection alternative to a levy because of the IRS’s policy of denying collection relief to taxpayers with unfiled returns. Vinatieri petitioned the United States Tax Court for relief. Vinatieri’s petition reiterated her dire financial condition, described a serious health problem she had, and explained her struggles as a single mother. The commissioner moved for summary judgment, contending that the IRS did not abuse its discretion in refusing a collection alternative. Vinatieri responded that she would be unable to pay her basic living expenses if the IRS seized her wages and she would not be able to travel to work if the IRS seized her car.