DocketNumber: No. 10777-97
Judges: GOLDBERG
Filed Date: 2/4/1999
Status: Non-Precedential
Modified Date: 11/20/2020
*35 Decision will be entered under Rule 155.
MEMORANDUM FINDINGS OF FACT AND OPINION
*36 [1] GOLDBERG, SPECIAL TRIAL JUDGE: This case was heard pursuant to the provisions of section 7443A(b)(3) and Rules 180, 181, and 182. All section references are to the Internal Revenue Code in effect for the year in issue, and all Rule references are to the Tax Court Rules of Practice and Procedure.
[2] Respondent determined a deficiency in petitioner's*37 1994 Federal income tax in the amount of $ 2,644 and additions to tax pursuant to
[3] After a concession by respondent,
[4] Some of the facts have been stipulated and are so found. The stipulation of facts and the attached exhibits are incorporated herein by this reference. At the time that the petition was*38 filed, petitioner resided in Sacramento, California.
FINDINGS OF FACT
[5] Petitioner is a member of the Seneca Nation. The Seneca Nation is a member of the Iroquois Confederacy of the Six Nations. Other members include the Mohawk, Oneida, Onondaga, Cayuga, and Tuscarora nations.
[6] In 1994, petitioner was employed by Schindler Elevator Corporation (Schindler) and was, apparently later in 1994, also employed by Dover Elevator Company (Dover).
[7] Schindler paid petitioner $ 16,005 in wages for the 1994 tax year and withheld FICA taxes from petitioner's wages, but did not withhold any Federal income tax. Dover paid petitioner $ 440 in wages in 1994. Dover withheld FICA and $ 27 of Federal income tax. The State of California also paid petitioner unemployment compensation in the amount of $ 7,360 in 1994.
[8] In 1996, petitioner was contacted by the Internal Revenue Service (IRS) because he had failed to file a 1994 Federal income tax return. In response to the IRS letter, petitioner mailed a copy of a 4-page affidavit to the IRS which he had signed on April 6, 1988.
[9] In the affidavit, petitioner contended that he was exempt from paying Federal income tax because he was a member of*39 the Seneca Nation. Petitioner has apparently mailed a copy of this affidavit to the IRS for every tax year from 1988 to 1994. Petitioner has not filed a Federal income tax return since 1988.
[10] On September 16, 1996, the IRS mailed a letter to petitioner which stated that based on (unspecified) information provided by petitioner, petitioner was not legally required to file a Federal income tax return for the 1994 tax year. The IRS mailed similar letters to petitioner for the 1989-93 tax years.
[11] In a notice of deficiency dated April 18, 1997, respondent determined a deficiency in petitioner's 1994 Federal income tax in the amount of $ 2,644. The deficiency is based on petitioner's failure to report wage income of $ 16,445, interest income of $ 50, and unemployment income of $ 7,360. Respondent calculated the deficiency based on single-filing status, one personal exemption allowance, and the standard deduction.
[12] In January 1998, after the filing of the petition in this case, petitioner filed his 1994 Federal income tax return with the IRS in Ogden, Utah. Petitioner sought to withdraw his Tax Court petition and litigate the issue of the taxability of his income in a United *40 States District Court.
[14] In further support of his claim of a Federal income tax exemption, petitioner also apparently contends that he was specifically hired by his employer because he is a member of the Seneca Nation and that this is an additional reason for exempting*41 his wages from the Federal income tax. Petitioner testified that he was hired to work "high rise" specifically because he was an Indian: "[O]ne of the reasons why [I] got the job was the Indians back in New York, all worked high rise."
[15] Petitioner contends that "The Federal Government and Congress intended to exempt Indians from taxation by a guarantee of total [tax] exemption through several treaties made with them et al."
[16] In
[18] This Court has also specifically held that members of the Seneca Nation were not exempt from Federal income taxes based on the same legal sources relied on by petitioner.
[19] Existing case law is clear and specific. We find that petitioner is not exempt from taxation because of his status as a member of the Seneca Nation. Additionally, petitioner's apparent contention that his income is somehow attributable to his status as a member of the Seneca Nation is vague and unsupported by the record, and we find that none of petitioner's income was derived directly or indirectly from the use of Indian land, or from services performed on Indian land, or related in any way to petitioner's status as a member of the Seneca Nation. Respondent is sustained on this issue.
[20] We hold that petitioner is not exempt from Federal*43 income taxes either because of his status as a member of the Seneca Nation, or because of the source of his income in this case. Furthermore, petitioner was required to file an income tax return for 1994 because he meets the requirements of section 6012.
2. BOND INTEREST INCOME
[21] Petitioner does not question the inclusion in gross income of wages and unemployment compensation if he is found to be subject to the Federal income tax. However, petitioner contests the inclusion of $ 50 of bond interest income *44 [23] In this case, petitioner does not contest the amount of income received from bond interest. Petitioner's sole contention is that the interest income was not includable in income for the 1994 tax year because he "thinks" that he did not purchase or own any stocks or bonds until 1997. Petitioner offered to provide documentation of his contention to this Court, but failed to do so.
[24] Upon the basis of the record, we find that petitioner received $ 50 in gross income from A.G. Edwards for the 1994 tax year. Respondent is sustained on this issue.
3. HEAD-OF-HOUSEHOLD STATUS
[25] Petitioner contends that his correct filing status is head of household.
[26] Petitioner testified that his 13-year-old son lived with him for the entire taxable year, and both parties have stipulated that petitioner was unmarried at all times during 1994.
[27]
[28] Upon the basis of the record, we*45 find that petitioner satisfied the head of household filing requirements of
4. DEPENDENCY EXEMPTION DEDUCTIONS
[29] Petitioner claimed a dependency exemption deduction on his 1994 Federal income tax return.
[30] Deductions are a matter of legislative grace, and the taxpayer bears the burden of proving that he is entitled to any deductions claimed.
[31]
[32] Petitioner testified that his son lived with him for the entire 1994 tax year, and it is clear from the record that petitioner met the support requirement of
[33] We find that petitioner satisfied the requirements of
5. ADDITION TO TAX
[34]
[35] Petitioner is a cash-method taxpayer whose tax year is the 12-month calender year. It is undisputed that he did not have any Federal income tax liability for the 1993 tax year. Additionally, petitioner is a United States citizen.
[36]
[37] Upon the basis of the record, we find that petitioner meets the requirements of
*47 [38] To reflect the foregoing,
[39] Decision will be entered under Rule 155.
1. Respondent has conceded that petitioner is not liable for the addition to tax under
2. Petitioner's oral motion to withdraw his Tax Court petition was made at the call of the calendar on Mar. 2, 1998, and was denied.↩
3. The treaty is known as the Treaty of Canadaigua or the Treaty of the Six Nations, Nov. 11, 1794, 7 Stat. 44.↩
4. The treaty is known as the Treaty of Peace and Amity or the Treaty of Ghent, Dec. 24, 1814, 8 Stat. 218, T.S. 109.↩
5. The treaty is known as the Treaty of Amity, Commerce, and Navigation or the Jay Treaty, Nov. 19, 1794, 8 Stat. 116, T.S. 105.↩
6. Specifically,
7. It should also be noted that the taxpayer in
8. This income was characterized as bond interest by petitioner and as "proceeds from broker transactions" by respondent.↩
9. Petitioner included the $ 50 in the $ 16,495 amount reported on line 7 as Wages, salaries, tips, etc., on his 1994 income tax return.↩