Ronald S. Adams v. Commissioner of IRS , 520 F. App'x 934 ( 2013 )

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 12-14132
Non-Argument Calendar
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Agency No. 18920-09
RONALD S. ADAMS,
Petitioner-Appellant,
versus
COMMISSIONER OF IRS,
Respondent-Appellee.
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Petition for Review of a Decision of the
U.S. Tax Court
________________________
(June 5, 2013)
Before CARNES, BARKETT and ANDERSON, Circuit Judges.
PER CURIAM:
Ronald Adams petitions for review of the final decision of the United States
Tax Court denying his pro se petition for redetermination of deficiency, pursuant
to 26 U.S.C. § 6213(a). The Tax Court sustained the Commissioner of the Internal
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Revenue Service’s (“Commissioner”) calculation of Adams’s tax deficiencies, and
rejected Adams’s argument that he had no obligation to file a tax return absent
personal notice to him by the Commissioner. On appeal, Adams repeats his
argument that he had no obligation to file a tax return absent personal notice of his
obligation to him by the Commissioner, and, therefore, he did not have a tax
deficiency because a deficiency requires a return to have been filed. He argues
that, although the Internal Revenue Code authorizes the Secretary of the Treasury,
by notice or by regulations, to require individuals to keep records and file returns,
the applicable regulations are insufficient to provide notice to him because they
mandate only the keeping of records. Second, Adams asserts that the Tax Court
erroneously denied his discovery motion before that Court, in which he had sought
copies of any documents in the possession of the Commissioner relating to him,
the substitute returns prepared for him by the Commissioner, and the personnel
records of the Internal Revenue Service employees who performed work on his
case. After thorough review, we affirm.
I.
We review decisions of the Tax Court “in the same manner and to the same
extent as decisions of the district courts in civil actions tried without a jury.”
Comm’r of Internal Revenue v. Neal, 557 F.3d 1262, 1268-69 (11th Cir. 2009).
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Accordingly, we review de novo the Tax Court’s legal determinations. Bone v.
Comm’r of Internal Revenue, 324 F.3d 1289, 1293 (11th Cir. 2003).
The statutory provision relied upon by Adams, 26 U.S.C. § 6001, reads in
relevant part as follows:
Every person liable for any tax imposed by this title, or for the
collection thereof, shall keep such records, render such statements,
make such returns, and comply with such rules and regulations as the
Secretary may from time to time prescribe. Whenever in the
judgment of the Secretary it is necessary, he may require any person,
by notice served upon such person or by regulations, to make such
returns, render such statements, or keep such records, as the Secretary
deems sufficient to show whether or not such person is liable for tax
under this title.
Id. The regulation relied upon by Adams in his opening brief is 26 C.F.R.
§ 1.6001-1, and is entitled “Records.” Id. It reads, in relevant part, as follows:
(a) In general. Except as provided in paragraph (b) of this section,
any person subject to tax under subtitle A of the Code . . . , or any
person required to file a return of information with respect to income,
shall keep such permanent books of account or records, including
inventories, as are sufficient to establish the amount of gross income,
deductions, credits, or other matters required to be shown by such
person in any return of such tax or information.
....
(d) Notice by district director requiring returns statements, or the
keeping of records. The district director may require any person, by
notice served upon him, to make such returns, render such statements,
or keep such specific records as will enable the district director to
determine whether or not such person is liable for tax under subtitle A
of the Code, including qualified State individual income taxes, which
are treated pursuant to section 6361(a) as if they were imposed by
chapter 1 of subtitle A.
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26 C.F.R. § 1.6001-1(a), (d). Farmers and wage-earners are exempted from certain
record-keeping requirements, but must still “keep such records as will enable the
district director to determine the correct amount of income subject to the tax.” Id.§ 1.6001-1(b). An additional regulation, entitled “Individuals required to make
returns of income,” mandates in relevant part that “an income tax return must be
filed by every individual for each taxable year” after receiving certain minimum
amounts of gross income not relevant to this appeal. Id. § 1.6012-1(a).
Adam’s challenge is without merit. Section 6001 establishes “the basic
principle that . . . every taxpayer[] must maintain accounting records which enable
him to file a correct tax return.” Webb v. Comm’r, 394 F.2d 366, 371 (5th Cir.
1968). 1 Section 1.6001-1(d) gives an agency discretionary authority to require any
person to keep certain records by giving such person appropriate notice. However,
it does not relieve all other taxpayers of their independent obligation to keep
records and file returns, as the regulations require. See 26 C.F.R. § 1.6001-1(a)
and (b) (notifying taxpayers of their obligation to keep records); id. § 1.6012-1(a)
(notifying taxpayers of their obligation to file tax returns). Accordingly, the Tax
Court did not err by rejecting Adams’s argument that he was not required to file a
1
In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), this Court
adopted as binding precedent all decisions of the former Fifth Circuit handed down prior to
October 1, 1981.
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tax return absent personal notice by the Commissioner of his obligation to file a tax
return.
II.
We review the denial of discovery for abuse of discretion. White v. Coca-
Cola Co., 542 F.3d 848, 853 (11th Cir. 2008). The denial of a discovery motion is
not an abuse of discretion where it is based on the moving litigant’s failure to
follow the applicable discovery rules requiring good-faith participation in the
discovery process. See Holloman v. Mail-Well Corp., 443 F.3d 832, 843-44 (11th
Cir. 2006) (affirming the district court’s denial of plaintiffs’ discovery motion
based on their “failure to work with the defendants in good faith to schedule the
depositions” and facilitate the other requested discovery).
Discovery in the Tax Court is governed by Tax Court Rules 70 through 74,
90 through 92, and 100 through 104. In relevant part, Tax Court Rule 70(a)(1)
requires “the parties to attempt to attain the objectives of discovery through
informal consultation or communication before utilizing the discovery procedures
provided in these Rules.” Tax Court Rule 70(a)(1). In relevant part, Tax Court
Rule 91(a)(1) requires that the parties stipulate to the fullest extent possible to “all
facts, all documents and papers or contents or aspects thereof, and all evidence
which fairly should not be in dispute.” Tax Court Rule 91(a)(1). If one party
“refused or failed to confer with an adversary with respect to entering into a
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stipulation,” the other party may move the Tax Court for an order to show cause
why the moving party’s proposed stipulation should not be deemed admitted. Tax
Court Rule 91(f). The Tax Court has held that the use of its formal discovery rules
before reasonable informal discovery efforts “sharply conflicts with the intent and
purpose of Rule 70(a)(1) and constitutes an abuse of the Court’s procedures.”
Branerton Corp. v. Comm’r, 61 T.C. 691, 692 (1974).
Here, the Tax Court did not abuse its discretion in denying Adams’s
discovery request. Adams had failed to comply with the Tax Court rules requiring
that the parties participate in an informal discovery process before resorting to
formal discovery. It was, therefore, within the Tax Court’s discretion to deny his
discovery motion, and Adams does not show that the Tax Court abused that
discretion. See Holloman, 443 F.3d at 843-44.
III.
Upon review of the entire record on appeal, and after consideration of the
parties’ briefs, we deny the petition for review.
PETITION DENIED.
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