1 Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 18091, 124 Stat. 119, 242 (2010), amended by Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111-152, 124 Stat. 1029 (to be codified primarily in scattered sections of 42 U.S.C.)

2 The author succumbs to use of the traditional nomenclature, to wit “Commerce Clause,” albeit an infinitive phrase.

3 “To regulate commerce with foreign nations, and among the several States, and with the Indian Tribes.” U.S. CONST. art. I, § 8, cl. 3. For support of the Commerce Clause violation, see Is the Obama Health Care Reform Constitutional? Fried, Tribe and Barnett Debate the Affordable Care Act, HARVARD LAW SCHOOL (Mar. 28, 2011), http://www.law.harvard.edu/news/spotlight/constitutionallaw/is-obama-health-care-reform-constitutional.html. The authors herein agree with the position espoused by Barnett.

4 “Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers … .” U.S. CONST. art. I, § 2, cl. 3. The reference to numbers is clearly a reference to population according to an “actual Enumeration.” Id.

5 “No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.” Id. at art. I, § 9, cl. 4. For support of the apportionment violation, see generally Willis, Steven J. & Chung, Nakku, Of Constitutional Decapitation and Healthcare, 128 Tax Notes 169 (2010)Google Scholar; Willis, Steven J. & Chung, Nakku, Oy Yes, the Healthcare Penalty Is Unconstitutional, 129 Tax Notes 725 (2010)Google Scholar; Steven J. Willis & Nakku Chung, Credits vs. Taxes: The Constitutional Effects on the Health Care Reform Debate, (Wash. Legal Found., Working Paper No. 176, 2011).

6 “To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers … .” U.S. CONST. art. I, § 8, cl. 18. For support of the necessary and proper violation, see Brief of Steven J. Willis, Urging Reversal at 9-16, Seven-Sky v. Holder, 661 F.3d 1 (D.C. Cir. 2011), petition for cert. filed, 80 U.S.L.W. 3359 (U.S. Nov. 30, 2011) (No. 11-679), http://aca-litigation.wikispaces.com/file/view/Willis+amicus+%2805.23.11%29.pdf [hereinafter Seven-Sky Brief].

7 “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” U.S. CONST. amend. X. While others have argued the point, the authors neither adopt nor deny their arguments; instead, the authors suggest the issue is clear: if the Congressional assertion of the power to issue the mandate exceeds its enumerated power, then it must be one of the powers reserved to the states or to the people.

8 “No person shall be … deprived of life, liberty, or property, without due process of law … .” Id. at amend. V.

9 Of the district courts considering the issue, two have ruled against the Act on Commerce Clause grounds and three have ruled favorably. See Virginia ex rel. Cuccinelli, 728 F. Supp. 2d 768, 782 (N.D. Va. 2010), vacated, 656 F.3d 253 (4th Cir. 2011), petition for cert. filed, 80 U.S.L.W. 3221 (U.S. Sept. 30, 2011) (No. 11-420) (unconstitutional); Florida ex rel. McCollum v. U.S. Dep't of Health & Human Servs., 716 F. Supp. 2d 1120, 1161-62 (N.D. Fla. 2010) (unconstitutional); Thomas More Law Ctr. v. Obama, 720 F. Supp. 2d 882, 895 (E.D. Mich. 2010), aff’d, 651 F.3d 529 (6th Cir. 2011), petition for cert. filed, (U.S. July 26, 2011) (No. 11-117) (constitutional); Mead v. Holder, 766 F. Supp. 2d 16, 34 (D.D.C. 2011), reh’g en banc denied sub nom. Seven-Sky v. Holder, 661 F.3d 1 (D.C. Cir. 2011), petition for cert. filed, 80 U.S.L.W. 3359 (U.S. Nov. 30, 2011) (No. 11-679) (constitutional); Liberty Univ., Inc. v. Geithner, 753 F. Supp. 2d 611, 635 (W.D. Va. 2010), vacated, No. 10-2347, 2011 WL 3962915 (4th Cir. Sept. 8, 2011), petition for cert filed, 80 U.S.L.W. 3240 (U.S. Oct. 7, 2011) (No. 11-438) (constitutional). Of the circuit courts considering the issue, three have ruled in favor of the government and one in favor of the petitioners. See Virginia ex rel. Cuccinelli, 656 F.3d 253 (ruling for the government on standing grounds, without reaching the merits); Seven-Sky, 661 F.3d 1 (ruling for the government on Commerce Clause grounds); Thomas More Law Ctr., 651 F.3d 529 (ruling for the government on Commerce Clause grounds); Florida ex rel. Att’y Gen. v. U.S. Dep't of Health & Human Servs., 648 F.3d 1235 (11th Cir. 2011), cert. granted sub nom. Nat’l Fed’n of Indep. Bus. v. Sebelius, 132 S. Ct. 603 (2011) (mem.), and cert. granted, 132 S. Ct. 604 (2011) (No. 11-398) (mem.) (argued Mar. 26-27, 2012), and cert. granted in part, 132 S. Ct. 604 (2011) (No. 11-400) (mem.) (argued Mar. 28, 2012) (ruling for petitioner on Commerce Clause grounds).

10 Steven J. Willis argued the due process issue in brief to the D.C. Circuit. See Seven-Sky Brief, supra note 6, at 24-28. The authors herein amplify and alter his argument. In particular, in the brief, the author conditioned his due process concerns on the “penalty” not being a tax. Id. at 25. Herein, the authors reflect a changed opinion and analysis: the violations of due process exist regardless of whether the penalty is a tax. To the extent the brief suggested the collection due process (CDP) process (incorrectly labeled as “CDC” in the brief) was non-essential for trust fund and other taxes not subject to section 6212 notice of deficiency procedures, the authors now reject that suggestion and regret having made it.

Indeed, Chairman Roth was correct in 1998 in demanding additional taxpayer protection for taxpayers subject to taxes not covered by section 6212 procedures. Press Release No. 105-276, Uncle Fed's Tax Board, Summary of Highlights of Chairman Roth's Comprehensive IRS Reform Legislation (1998), available at http://www.unclefed.com/TxprBoR/1998/105-276.html (discussing the reform's protection of taxpayers). Also, Willis questioned whether the section 5000A(g) levy and lien limitations apply to a section 6722 penalty or to section 6601 interest. See Seven-Sky Brief, supra note 6, at 27. Willis and Chung herein conclude the limitation would not apply to those sections. This issue is not directly relevant to the due process argument, however, except to limit it to the section 5000A penalty.

11 See Is the Obama Health Care Reform Constitutional?, supra note 3 (pointing out Professor Barnett's view that Congress did not want to pay politically for using its tax power to increase healthcare access). This is a political prediction; after the Democrats lost the Senate seat in Massachusetts to Senator Brown—and thus lost their sixty-vote-near-filibuster-proof majority—the chance of Congress passing material changes to the healthcare legislation, other than possible repeal, seems remote.

12 Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 18091, 124 Stat. 119, 242 (2010), amended by Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111-152, 124 Stat. 1029 (to be codified primarily in scattered sections of 42 U.S.C.).

13 Section 5000A(a)(1) imposes the Mandate and paragraph (b)(1) imposes the Penalty only on persons who fail to satisfy the Mandate. I.R.C. § 5000A(a)(1) (2010). If the Court were to strike just the Mandate, no one could fail to satisfy it and thus no one could trigger the Penalty.

14 Although one can imagine the political issues involved in the repeal of the pre-existing condition provision, one can also see that it would have to be changed were the Mandate or the Penalty held to be unconstitutional. However politically difficult such a change might be, generally if something has to happen, it does. The alternative, all health insurance companies refusing to write any further coverage, would be unacceptable and politically worse than keeping the pre-existing condition provision.

15 Section 5000A(g)(2)(A) waives the application of criminal sanctions for failure to comply with the Mandate. I.R.C. § 5000A(g)(2)(A). Similarly, subparagraph (g)(2)(B) precludes the Secretary from filing liens and levies with regard to section 5000A failures. Id. § 5000A(g)(2)(B). The only enforcement mechanism Congress provided was the subsection (b)(1) penalty, id. § 5000A(g)(2)(B)(1); however, if the Court were to strike that subsection, it would leave the subsection (a) mandate with no enforcement provision.

16 See, e.g., Kaiser Health Tracking Poll, KAISER FAM. FOUND. (Mar. 2011), http://www.kff.org/kaiserpolls/upload/8166-f.pdf; CNN Poll: Majority Oppose Individual Mandate, CNN (June 9, 2011), http://politicalticker.blogs.cnn.com/2011/06/09/162714/.

17 See Mellor, Daniel L., The Individual Mandate Tax: Healthcare's Toothless Watchdog, 130 Tax Notes 105, 112 (2011)Google Scholar.

18 See U.S. CONST. art. I, § 8, cl. 3 (“The Congress shall have Power - To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.” (emphasis added)). James Madison argued, in Federalist 44: “Without the substance of this power, the whole Constitution would be a dead letter.” THE FEDERALIST NO. 44, at 251, 253-54 (James Madison) (Am. Bar Ass’n ed., 2009); see also United States v. Comstock, 130 S. Ct. 1949, 1962 (2010) (“The powers ‘delegated to the United States by the Constitution’ include those specifically enumerated powers listed in Article I along with the implementation authority granted by the Necessary and Proper Clause.” (quoting New York v. United States, 505 U.S. 144, 156, 159 (1992))).

19 U.S. CONST. amend. XVI (“Congress shall have the power to levy taxes … .”).

20 See Gonzales v. Raich, 545 U.S. 1, 22 (2005) (“[A]s in Wickard, when it enacted comprehensive legislation to regulate the interstate market in a fungible commodity, Congress was acting well within its authority to ‘make all Laws which shall be necessary and proper’ to ‘regulate Commerce … among the several States.’” (quoting U.S. CONST., art. I, § 8)).

21 Id. at 52 (O’Connor, J., dissenting) (“Congress cannot use its authority under the Clause to contravene the principle of state sovereignty embodied in the Tenth Amendment.”).

22 Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 2704, 124 Stat. 119, 154 (2010), amended by Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111-152, 124 Stat. 1029 (to be codified primarily in scattered sections of 42 U.S.C.).

23 “Like in a masonry arch, the keystone of the individual mandate enables all the other pieces of reform to lock into place. Without it, the arch crumbles. Think about it. People could wait until they were seriously ill to buy coverage, knowing that insurance companies could not turn them down. Insurers, because they would be covering mostly sick people, would need to raise premiums to stay afloat.” Karen Davenport, Yes: It's the Key to Reform, Section of Should Everyone Be Required to Have Health Insurance?, WALL ST. J. (Jan. 23, 2012), http://online.wsj.com/article/SB10001424052970204124204577152842650354880.html.

24 See generally Seven-Sky Brief, supra note 6.

25 Seven-Sky v. Holder, 661 F.3d 1, 5 (D.C. Cir. 2011), petition for cert. filed, 80 U.S.L.W. 3359 (U.S. Nov. 30, 2011) (No. 11-679).

26 Seven-Sky Brief, supra note 6, at 26.

27 Id. (outlining the statutory framework for hearings). Section 5000A(g)(1) eliminates the possibility of criminal proceedings, as well as civil proceedings involving liens and levies. I.R.C. § 5000A(g)(1) (2010). It then subjects the penalty to other subchapter 68B procedures. Section 6671(a) provides: “The penalties and liabilities provided by this subchapter shall be paid upon notice and demand by the Secretary, and shall be assessed and collected in the same manner as taxes.” I.R.C. § 6671(a) (1986). Subchapter 68B does not otherwise provide procedures relevant to the section 5000A(b)(1) penalty. Section 6201 grants the Secretary authority to assess a tax. I.R.C. § 6201(a) (2012). Subchapter 63B then provides the procedural mechanism for many taxes, but not including the section 5000A(b)(1) penalty. I.R.C. § 6211 (1988). These procedural rules provide the routine procedures for Tax Court jurisdiction pre-collection, predicated on a notice of deficiency. I.R.C. § 6212 (1998). Section 6301 grants the Secretary authority to collect taxes. I.R.C. § 6301 (1986). Section 6303 requires that “notice and demand” occur within sixty days of assessment. I.R.C. § 6303 (1986). Section 6302(a) grants the Secretary general authority to promulgate regulations regarding the collection of taxes. I.R.C. § 6302(a)(1) (1986). No such regulations yet exist in relation to the section 5000A(b)(1) penalty and nothing in section 5000A requires any particular regulation, waiting period, or opportunity to be heard; hence, the Secretary may grant such periods or opportunities pursuant to the general section 6302 regulatory authority, but Congress did not require the Secretary to exercise that authority. Section 6321 grants the Secretary authority to file liens on taxpayer property. I.R.C. § 6321 (1998). Sections 6320 and 6326 provide procedural appeal rights to taxpayers subject to such liens. I.R.C. §§ 6320 (2006), 6326 (1988). Section 5000A(g)(2)(B)(i) precludes the Secretary from filing a notice of lien and thus precludes the operation of the lien procedural protections. Section 6330 provides procedural protections for taxpayers subject to levy. I.R.C. § 6330 (2006). However, section 5000A(g)(2)(B)(ii) precludes the Secretary from levying with regard to a section 5000A penalty; hence, the levy protections cannot apply. No other significant procedural collection protections exist in the Internal Revenue Code.

28 Mellor, supra note 17, at 108.

29 Seven-Sky Brief, supra note 6, at 28 (noting citizens will only have opportunity to sue for a refund).

30 See id.

31 Oppliger v. United States, 637 F.3d 889, 892 (8th Cir. 2011).

32 Book, Leslie, The New Collection Due Process Taxpayer Rights, 86 Tax Notes 1127, 1132 n.30 (2000)Google Scholar (“Changes to the burden of proof in tax cases substantively did little but were important and worth enacting because of the perception that under prior law criminal defendants enjoyed a presumption of innocence and taxpayers were presumed “guilty” in dealings with the IRS.”).

33 But see Virginia ex rel. Cuccinelli v. Sebelius, 656 F.3d 253, 272 (4th Cir. 2011), petition for cert. filed, 80 U.S.L.W. 3221 (U.S. Sept. 30, 2011) (No. 11-420) (holding Virginia lacked standing to challenge Mandate because it lacked “personal stake” in case outcome). The Circuit addressed the Mandate and Penalty together, rather than separately, as argued herein.

34 But see id. (citing Ill. Dep't of Transp. v. Hinson, 122 F.3d 370, 373 (7th Cir. 1997)) (“[R]ules of standing aim to prevent state ‘bureaucrats’ and ‘publicity seekers’ from ‘wresting control of litigation from the people directly affected.’”).

35 Id.

36 TAX CT. R. 142(a).

37 For purpose of this Article, an income tax is one authorized by the Sixteenth Amendment. See U.S. CONST. amend. XVI.

38 The corporate income tax is actually an excise and not a direct tax. Flint v. Stone Tracy Co., 220 U.S. 107, 151-52 (1911). For this proposition, Stone Tracy remains authoritative. In Brush v. Commissioner, 300 U.S. 352, 372 (1937), the Court distinguished Stone Tracy on a minor issue: “The contention is made that our decisions in South Carolina v. United States, 199 U.S. 437, 461, 462, and Flint v. Stone Tracy Co., 220 U.S. 107, 172, are to the effect that the supplying of water is not a governmental function; but in neither case was that question in issue, and what was said by the court was wholly unnecessary to the disposition of the cases and merely by way of illustration. Expressions of that kind may be respected, but do not control in a subsequent case when the precise point is presented for decision.” That issue had nothing to do with whether the corporate tax was or is an excise, rather than a direct tax or an income tax. Later, the Court in Garcia v. San Antonio Transit Authority, referred to the prior distinction:

496 U.S. 528, 542 (1985). Unfortunately, LEXIS and Sheppard's erroneously describe Stone Tracy as having been overruled. Stone Tracy, however, has not been overruled and remains one of the top tax decisions in United States history.

39 See Seven-Sky Brief, supra note 6, at 26.

40 The government has limited power to proceed in matters involving “jeopardy assessment” per section 6331 or a “termination assessment” per section 6851. See I.R.C. § 6331(d)(3) (2006) (jeopardy requirement); id. § 6851(a)(1) (termination assessments permissible where taxpayer likely to flee). Such assessments involve situations where the taxpayer is likely to depart the United States quickly or in which collection is otherwise in jeopardy. Id. §§ 6331(d)(3), 6851(a)(1). However, in each case, the taxpayer is afforded the opportunity for quick post assessment and levy review per section 7429. Id. § 7429(a)(2). The Chief Counsel for the IRS must personally approve any levy pursuant to such assessments unless thirty days have passed after notice and demand; plus, the taxpayer is entitled to quick administrative review, as well as quick judicial review. Id. § 7851. Many courts have upheld these procedures on due process grounds.

41 Id. § 6212.

42 Notice of Deficiency, Tax Court, and District Court, INSIGHT LAW, http://www.insightlawfirm.com/notice-of-deficiency-and-tax-court.html(last visited Feb. 28, 2012).

43 I.R.C. § 6213(a).

44 Id.

45 Id. § 6213(c).

46 “Assessment is the statutorily required recording of the tax liability.” IRM 35.9.2.1 (Aug. 11, 2004), http://www.irs.gov/irm/part35/irm_35-009-002.html. Subject to the sixty-day notice requirement of section 6303, the Secretary may proceed to collect any tax. I.R.C. §§ 6301, 6303 (1986). Nothing requires a court judgment, although for some taxes, the taxpayer has a pre-collection opportunity to be heard. See supra text accompanying note 27.

47 See supra text accompanying note 27.

48 U.S. CONST. amend. V.

49 See, e.g., 31 U.S.C. §§ 3729-3733 (2006).

50 See, e.g., FED. R. CIV. P. 4 (notice requirement).

51 See, e.g., Federal Tort Claims Act, 28 U.S.C. § 1346(b) (1948).

52 I.R.C. § 6213(a) (2006). The ninety-day period comprises the taxpayer opportunity to file a petition in the Tax Court without having to first pay the tax deficiency asserted in the ninety-day notice. If the taxpayer fails to file such a petition, the IRS may assess the tax and then proceed with collection.

53 TAX CT. R. 142(a)(1) (“The burden of proof shall be upon the petitioner, except as otherwise provided by statute or determined by the Court; and except that, in respect of any new matter, increases in deficiency, and affirmative defenses, pleaded in the answer, it shall be upon the respondent.”).

54 “In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved … .” U.S. CONST. amend. VII.

55 The Tax Court, as an Article I court, does not have juries and lacks general equitable powers. C.I.R. v. McCoy, 484 U.S. 3, 7 (1987) (“The Tax Court is a court of limited jurisdiction and lacks general equitable powers.”); About the Court, UNITED STATES TAX COURT, http://www.ustaxcourt.gov/about.htm (last visited Feb. 28, 2012). In the alternative, the taxpayer may sue for a refund in the United States Court of Federal Claims, which, as an Article I court, also does not have juries. 28 U.S.C. § 1491 (1996); see UNITED STATES COURT OF FEDERAL CLAIMS, THE PEOPLE's COURT (2012).

56 I.R.C. §§ 6212-6215.

57 See generally MICHAEL J. SALTZMAN, IRS PRACTICE AND PROCEDURE (2d ed. 2008).

58 Id.

59 According to the IRS “[a] trust fund tax is money withheld from an employee's wages (income tax, social security, and Medicare taxes) by an employer and held in trust until paid to the Treasury.” Trust Fund Taxes, IRS.GOV (Oct. 18, 2011), http://www.irs.gov/businesses/small/article/0,,id=98830,00.html.

60 Compare I.R.C. §§ 6320, 6330 (2010), with id. § 6212.

61 See U.S. CONST. amend. XVI.

62 Internal Revenue Service Restructuring and Reform Act of 1998, Pub. L. 105-206, sec. 3401(a)-(b), §§ 6320, 6330, 112 Stat. 746 (1998) (“Subchapter C of chapter 64 (relating to lien for taxes) is amended by inserting [section 6320] … Subchapter D of chapter 64 (relating to seizure of property for collection of taxes) is amended by inserting [section 6330].”).

63 Id. Until 1998, taxpayers subject to lien or levy fit into two general categories: those who were entitled to a section 6212 notice of deficiency and those who were not. For those covered by section 6212, the government could not proceed with collection until after the ninety days provided by the section ended or until after the Tax Court proceeding, if any, was final. Id. §§ 6212, 6213(c). For those not entitled to a section 6212 notice, the government could proceed to collection after notice and demand. I.R.C. §§ 6301 (1986), 6303 (1986).

64 See supra text accompanying notes 53-56.

65 See Book, supra note 32, at 1128 (“One important change that specifically addresses supposed IRS collection abuses is the enactment of sections 6320 and 6330, the new due process rights with respect to collection activities. Effective for collection actions initiated after January 18, 1999, these sections give taxpayers expanded preseizure notice rights.”).

66 See generally id. (quoting and documenting complaints regarding alleged IRS abuses).

67 Id. at 1132 n.32 (documenting controversy among legislators and with the executive). See generally Donmoyer, Ryan J., Chairman Roth and the Politics of IRS Reform, 77 Tax Notes 1296 (1997)Google Scholar; Donmoyer, Ryan J., Roth Outlines ‘Deficiencies’ in IRS Reform Bill, 77 Tax Notes 764 (1997)Google Scholar (describing controversy between Senator Roth and Senator Kerry plus forty-one other Senate Democrats).

68 NAT’L COMM’N ON RESTRUCTURING THE INTERNAL REVENUE SERV., A VISION FOR A NEW IRS (1997), available at http://www.house.gov/natcommirs/report1.pdf.

69 Internal Revenue Service Restructuring and Reform Act of 1998, Pub. L. No. 105-206, 112 Stat. 685.

70 144 CONG. REC. S4452 (1998); see Donmoyer, Ryan J. and Rieschick, Jacqueline, It's (Almost) Unanimous: IRS Reform Bill Passes House, 77 Tax Notes 639 (1997)Google Scholar.

71 See generally Donmoyer, Chairman Roth and the Politics of IRS Reform, supra note 67; Donmoyer, Roth Outlines ‘Deficiencies’ in IRS Reform Bill, supra note 67.

72 See Internal Revenue Service Restructuring and Reform Act of 1998, Pub. L. No. 105-206, 112 Stat. 685.

73 See supra text accompanying note 66.

74 IRS Restructuring: Hearing on H.R. 2676 Before the S. Comm. on Finance, 105th Cong. (1998).

75 See Clukey, Nathan E., Examining the Limited Benefits of the Burden of Proof Shift, 82 Tax Notes 683, 683 (1999)Google Scholar.

76 I.R.C. § 6330(a)(1) (2010).

77 LT 11 (Letter 1058) Frequently Asked Questions, IRS.GOV, http://www.irs.gov/individuals/article/0,,id=185720,00.html (last updated Jan. 12, 2012)

78 Notice of Intent to Levy and Notice of Your Right to a Hearing, IRS.GOV, http://www.irs.gov/individuals/article/0,,id=128017,00.html (last updated Apr. 25, 2011)

79 Id.

80 Id.

81 Id.

82 INTERNAL REVENUE SERV., DEP't OF THE TREASURY, CAT. NO. 26685D, FORM 12153: REQUEST FOR A COLLECTION DUE PROCESS OR EQUIVALENT HEARING (2011), available at http://www.irs.gov/pub/irs-pdf/f12153.pdf [hereinafter FORM 12153].

83 Id.

84 The determination is critical, as it prompts Tax Court jurisdiction. See I.R.C. § 6330(d)(1) (2006). Section 6320(c), dealing with CDP hearings for lien notices, incorporates subsection 6330(d). Id. § 6320(c). Section 6330(c)(3) describes the “[b]asis for the determination.” Id. § 6330(c)(3). Treasury Regulations under section 6330 describe the importance of the determination. Treas. Reg. § 301.6330-1(e)(3), Q&A (E-10) (2006) (discussing importance of Notice of Determination and its date). In “equivalent hearings,” discussed below, the hearing officer issues a decision, rather than a determination. Decisions do not prompt Tax Court jurisdiction. Treas. Reg. § 301.6330-1(i) (2) Q&A (I6) (2006).

85 See I.R.C. § 6330(d)(1).

86 See FORM 12153, supra note 82.

87 See Treas. Reg. § 301.6330-1(i)(1) (“A taxpayer who fails to make a timely request for a CDP hearing is not entitled to a CDP hearing. Such a taxpayer may nevertheless request an administrative hearing with Appeals, which is referred to herein as an ‘equivalent hearing.’ The equivalent hearing will be held by Appeals and generally will follow Appeals procedures for a CDP hearing. Appeals will not, however, issue a Notice of Determination. Under such circumstances, Appeals will issue a Decision Letter.”).

88 INTERNAL REVENUE SERV., DEP't OF THE TREASURY, CAT. NO. 14376Z, PUBL’N 1660: COLLECTION APPEAL RIGHTS (2011), available at http://www.irs.gov/pub/irs-pdf/p1660.pdf.

89 Treas. Reg. § 301.6330-1(i)(2), Q&A (I6) (“Q-I 6. Will a taxpayer be able to obtain Tax Court review of a decision made by Appeals with respect to an equivalent hearing? A-I 6. Section 6330 does not authorize a taxpayer to appeal the decision of Appeals with respect to an equivalent hearing. A taxpayer may under certain circumstances be able to seek Tax Court review of Appeals’ denial of relief under section 6015. Such review must be sought within 90 days of the issuance of Appeals’ determination on those issues, as provided by section 6015(e).”)

90 I.R.C. § 6330(c)(2) (2010).

91 See Treas. Reg. § 301.6503(a)-1 (1986).

92 Tax practitioners and judges commonly refer to the ninety-day letter as a “ticket to tax court” because it is the most common prerequisite to Tax Court jurisdiction. For an example of Tax Court judges doing so, albeit in a dissent, see Thompson v. Comm’r, No. 30586-08, 2011 WL 6781017, at *10-12 (T.C. Dec. 27, 2011) (Goeke, J., dissenting).

93 I.R.C. § 6330(c)(2)(B) (2006).

94 Treas. Reg. § 1.301-6330-1, Q&A (F3) (2006) (“In seeking Tax Court review of a Notice of Determination, the taxpayer can only ask the court to consider an issue, including a challenge to the underlying tax liability, that was properly raised in the taxpayer's CDP hearing.”). Per section 6330(c)(2)(B), a person may not raise challenges to the underlying tax liability at a CDP hearing if the person received a statutory notice of deficiency for such liability. I.R.C. § 6330(c)(2)(B) (limiting CDP hearing issues to, inter alia, challenges of tax liabilities for which the person received no notice of deficiency).

95 I.R.C. § 6672 (1989).

96 See Oppliger v. United States, 637 F.3d 889, 893 (8th Cir. 2011), for a judicial discussion of who constitutes a responsible party.

97 Section 6212 limits the Secretary's power to grant a notice of deficiency for taxes imposed by subtitle A or B or chapter 41, 42, 43, or 44. I.R.C. § 6212(a). Section 6672 appears, however, in chapter 68; hence, it cannot prompt a section 6212 notice of deficiency.

98 Tax Court jurisdiction arises generally under section 7442. I.R.C. § 7442 (1986). With regard to deficiencies, it arises under section 6213. I.R.C. § 6213 (1998).

99 See 3 NAT’L TAXPAYER ADVOCATE SERVICE, 2005 ANNUAL REPORT TO CONGRESS 471, 543 (2005) available at http://www.irs.gov/pub/irs-utl/section_3.pdf (noting frequent litigation regarding section 6672 penalties in the Claims Court, the district courts, and in the Bankruptcy Court).

100 I.R.C. § 6330(c)(2)(B) (2010).

101 Trust Fund Recovery Penalty (TFRP), IRS.GOV, http://www.irs.gov/individuals/article/0,,id=160741,00.html (last updated Jan. 25, 2012).

102 Greene-Thapedi v. Comm’r, 126 T.C. 1, 6 (2006) (citations omitted): The Tax Court is a court of limited jurisdiction; we may exercise jurisdiction only to the extent expressly authorized by Congress… . Our jurisdiction in this case is predicated upon section 6330(d)(1)(A), which gives the Tax Court jurisdiction “with respect to such matter” as is covered by the final determination in a requested hearing before the Appeals Office… . “Thus, our jurisdiction is defined by the scope of the determination” that the Appeals officer is required to make… . The Appeals officer's written determination is expected to address “the issues presented by the taxpayer and considered at the hearing.” … At the hearing, the Appeals officer is required to verify that “the requirements of any applicable law or administrative procedure have been met.” … he Appeals officer is also required to address whether the proposed collection action balances the need for efficient tax collection with the legitimate concern that any collection action be no more intrusive than necessary… . The taxpayer may raise “any relevant issue relating to the unpaid tax or the proposed levy.” … The taxpayer is also entitled to challenge “the existence or amount of the underlying tax liability” if he or she “did not receive any statutory notice of deficiency for such tax liability or did not otherwise have an opportunity to dispute such tax liability.”

103 I.R.C. § 6330(d)(1).

104 Id. § 6330(c)(2)(B) (“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.”).

105 Swanton v. Comm’r, No. 7181-08L, slip op. at 3 (T.C. June 24, 2010) (“Where the validity of the underlying tax liability is properly in issue, the Court will review the matter de novo; but where the validity of the underlying tax is not properly in issue, the Court will review the Commissioner's determination for abuse of discretion… . An abuse of discretion is any action that is arbitrary, capricious, or without sound basis in law or fact.” (internal citations omitted)), available at http://www.ustaxcourt.gov/InOpHistoric/swanton.TCM.WPD.pdf.

106 Id. Essentially, the Court would find the Appeals Officer's determination that the taxpayer had a sufficient opportunity was “without sound basis in law or fact.” Id. Indeed, that is what occurred in Swanton.

107 Id. at 8.

108 See I.R.C. § 6321 (2006) (“If any person liable to pay any tax neglects or refuses to pay the same after demand, the amount (including any interest, additional amount, addition to tax, or assessable penalty, together with any costs that may accrue in addition thereto) shall be a lien in favor of the United States upon all property and rights to property, whether real or personal, belonging to such person.”).

109 Id. § 6320(a)(2)-(3).

110 Id. § 6320(b).

111 Id. § 6320(b)(4).

112 Internal Revenue Service Restructuring and Reform Act of 1998, Pub. L. No. 105–206, 112 Stat. 685.

113 S. REP. NO. 105-174, at 67 (1998).

114 Congress (and thus the President with his signature) actually used the terms “Due Process for Liens” and “Due Process for Collections” in the titles to part I of subchapter C and part I of subchapter D of chapter 64 of the Internal Revenue Code. The Secretary of the Treasury promulgated regulations transposing the words to “Collection Due Process” and thus CDP. Treas. Reg. § 301.6330- 1(a)(1) (2006).

115 I.R.C. § 5000A(b) (2010).

116 See supra text accompanying notes 45, 61.

117 I.R.C. § 6320(a)(2)-(3) (2006).

118 I.R.C. § 5000A(g)(2)(B).

119 The Tax Court's jurisdiction rests on a section 6212 notice of deficiency or on a CDP determination. The section 5000A(b) Penalty, however, is not among the provisions listed in section 6212 that can trigger a notice of deficiency. I.R.C. § 6212(a)(1) (1998). Further, section 5000A(g) bars the Secretary from the use of levy or from filing a notice of lien, the two actions which prompt CDP hearings. As such, Congress has created no possibility of pre-collection judicial review of the healthcare Penalty. Under the Constitution, only Congress may grant jurisdiction to courts. U.S. CONST. art. I, § 8, cl. 9; id. at art. III, § 1.

120 U.S. CONST. art. I, § 8, cl. 9; id. at art. III, § 1.

121 I.R.C. § 7421(a) (2006) (“Except as provided in sections 6015(e), 6212(a) and (c), 6213(a), 6225(b), 6246(b), 6330(e)(1), 6331(i), 6672(c), 6694(c), 7426(a) and (b)(1), and 7429(b), and 7463 no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person, whether or not such person is the person against whom such tax was assessed.”).

122 I.R.C. § 6331.

123 I.R.C. section 6321 provides for an automatic or “silent lien.” For the lien to be effective against third parties, the IRS must file a notice of lien, consistent with the CDP protection of sections 6330 and 6320. Id. § 6321; Mellor, supra note 17, at 108.

124 I.R.C. § 5000A(g) (2010).

125 See generally Mellor, supra note 17 (opining that the Penalty is a constitutional tax, but also noting its limited enforceability).

126 I.R.C. § 5000A(g)(2)(A).

127 See, e.g., INTERNAL REVENUE SERV., DEP't OF THE TREASURY, CAT. NO. 11340T, FORM 1040-ES: ESTIMATED TAX FOR INDIVIDUALS (2011) [hereinafter FORM 1040-ES] (“Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.”).

128 I.R.C. § 7206 (making false statements on a tax return is a felony, punishable by a fine of up to $100,000 and/or imprisonment of up to three years).

129 I.R.C. § 5000A(g) (2010).

130 See I.R.C. § 6651.

131 See id. § 7203 (applying to the willful failure to file a return, supply information, or pay a tax). Regardless whether the section 5000A Penalty for the failure to have adequate health insurance is a tax or a mere penalty, the section 7203 penalty is surely a tax triggered by the failure to supply information. This is consistent with Congress's enumerated power to lay and collect taxes. U.S. CONST. art. I, § 8, cl. 1.

132 See I.R.C. § 7203.

133 See id. § 6651.

134 See id. § 7203.

135 U.S. CONST. amend. V.

136 See supra Part V.B.

137 I.R.C. § 5000A(g)(2)(B)(ii) (2010).

138 See I.R.C. § 6402.

139 Mellor, supra note 17, at 110 (explaining the availability of offset despite the prohibition on levy).

140 See supra notes 84-85 and accompanying text.

141 I.R.C. § 5000A(g)(1).

142 As posited supra in the text accompanying notes 15, 27, the Treasury could grant protest and other administrative remedies; however, nothing in the Act requires that it do so. The authors, however, suggest the due process requirements of the Fifth Amendment compel the government to grant such procedures, and further compel Congress to make the sufficiency of them judicially reviewable. Without such remedies and review, the collection procedures of section 5000A appear to violate due process.

143 See supra note 27.

144 See 28 U.S.C. § 2283 (2010).

145 Reapplication of tax “payments” is not a widely used tool; however, at least some courts have approved it. See Davis v. United States, 961 F.2d 867, 878-80 (9th Cir. 1992) (recognizing general authority to allocate undesignated payments, as well as authority to re-designate previously allocated amounts). See also Mellor, supra note 17, at 111 (arguing that reallocation of tax payments is an available tool in relation to the section 5000A Penalty).

146 Section 3402 provides for withholding of income tax at the source. I.R.C. § 3402 (2004). Subsection (f) permits an employee to modify the amount withheld. Id. § 3402(f). Employees use Form W-4 for the process. INTERNAL REVENUE SERV., DEP't OF THE TREASURY, CAT. NO. 10220Q, FORM W-4 (2012), available at http://www.irs.gov/pub/irs-pdf/fw4.pdf. Form 1040-ES similarly permits a taxpayer to adjust the amount of his estimated tax deposits. See FORM 1040-ES, supra note 127.

147 See Gerald Prante, Average Taxpayer Spends 21 Hours Each Year, TAX FOUND. TAX POL’Y BLOG (Sept. 23, 2005), http://www.taxfoundation.org/blog/show/1080.html.

148 See Enhance Short-Term and Emergency Savings, POLICYFORRESULTS.ORG, http://www.policyforresults.org/topics/policy-areas/children-safe-supportive-successfulfamilies/reduce-poverty/poverty-level/what-works/strategies/build-household-assets/enhance-shortterm-and-emergency-savings (last visited Feb. 28, 2012).

149 See supra text and explanation accompanying notes 45, 61.

150 See INTERNAL REVENUE SERV., DEP't OF THE TREASURY, CAT. NO. 11360L, FORM 1040X (2011), available at http://www.irs.gov/pub/irs-pdf/f1040x.pdf.

151 Section 7422(f)(1) permits a refund suit. I.R.C. § 7422(f)(1) (1986). Section 7422(a) requires the taxpayer to first exhaust administrative remedies. I.R.C. § 7422(a) (2010).

152 I.R.C. § 7430 (1998).

153 Id. § 7491. The burden shifts to the government if the taxpayer presents credible evidence. Id.

154 See supra text accompanying note 118.

155 See I.R.C. §§ 6320(b)(1), 6330(b)(1).

156 See FORM 1040-ES, supra note 127.

157 Id. I.R.C. section 6211(b)(1) refers to them as “payments on account of” tax, as opposed to payments of tax; however, it disregards estimated “payments,” as well as amounts withheld for purposes of determining a deficiency. I.R.C. § 6211(b)(1) (2010). Essentially, the amounts are deposits potentially subject to reapplication. Per section 6315, they are “payments on account” of the underlying tax. I.R.C. § 6315 (1986). They become payments of the underlying tax upon the filing of the return, when they are “applied against the tax shown on such return.” Treas. Reg. § 301.6315-1 (1954). The distinction of “payments” versus “deposits” is a common distinction in tax law and has resulted in significant litigation. Generally, a payment refers to a transfer in satisfaction of an amount due, earned, or certain to be earned. See Comm’r v. Indianapolis Power & Light Co., 493 U.S. 203, 212-14 (1990) (rejecting pre-existing tests of what constitutes a deposit rather than a payment and applying a new test which focuses upon the certainty of the earning). In relation to “tax payments,” the same dichotomy is relevant. As noted in Davis v. United States, 961 F.2d 867, 879 (9th Cir. 1992), whether a debt is mature is relevant in determining the validity of a tax “payment” reallocation. Ultimately, this becomes an issue of labels. Just as calling the healthcare Penalty a penalty rather than a tax is arguably not determinative of whether it is a penalty or a tax, calling an estimated tax payment a payment should not be determinative of whether it is a tax payment rather than a deposit. The substance of the transfer should control.

158 Raby, Burgless J.W. & Raby, William L., The Tax Court's Offset Jurisdiction — Or Lack Thereof, 113 Tax Notes 833, 836 (2006)Google Scholar (discussing, inter alia, reapplication of estimated taxes).

159 U.S. POPClock Project, U.S. CENSUS BUREAU, http://www.census.gov/population/www/popclockus.html (last visited Feb. 27, 2012).

160 Mellor, supra note 17, at 111.

161 See id. at 108, 111. Because reapplication or re-prioritization is not a formal procedure, nothing requires the service to provide notice of it. The general notice requirements in the code are for a section 6212 notice of deficiency, a 6330 notice of intent to levy, a section 6320 notice of intent to file a lien, and a section 6155 notice and demand. None require notice of a reapplication.

162 I.R.C. § 6511(a) (1958) (taxpayers must file a refund claim within three years of the date the return was filed or two years of payment, whichever is later).

163 See Florida ex rel. Att’y Gen. v. U.S. Dep't of Health & Human Servs., 648 F.3d 1235, 1351, 1355 (11th Cir. 2011) (Marcus, J., dissenting in part), cert. granted sub nom. Nat’l Fed’n of Indep. Bus. v. Sebelius, 132 S. Ct. 603 (2011) (mem.), and cert. granted, 132 S. Ct. 604 (2011) (No. 11-398) (mem.) (argued Mar. 26-27, 2012), and cert. granted in part, 132 S. Ct. 604 (2011) (No. 11-400) (mem.) (argued Mar. 28, 2012).