DocketNumber: No. 16905-05L
Citation Numbers: 2009 T.C. Memo. 88, 2009 Tax Ct. Memo LEXIS 172
Judges: WELLS
Filed Date: 4/28/2009
Status: Non-Precedential
Modified Date: 11/21/2020
MEMORANDUM OPINION
WELLS,
None of the facts have been stipulated, because petitioner claimed the protection of the
In documents that he sent to respondent, petitioner made various tax-protester arguments. He argued that, because he was white, he was a "sovereign citizen of Oregon" and a "non-resident alien of the United States". He claimed that his sovereign status made his body real property, gave him the ability to opt out of paying Federal taxes by revoking an election he had purportedly made under
For his 1991 taxable year petitioner filed a Form 1040NR, U.S. Nonresident Alien Income Tax Return, on which he listed an Oregon address. Petitioner crossed out large portions of the Form 1040NR, wrote "N/A" on several lines, reported tax of $ 163 on income not effectively connected with a U.S. trade or business, *174 sought a refund of $ 837 based on $ 1,000 paid with an extension request, and altered the jurat by adding "with express reservation of all my rights in law and equity, and all other natures of law." Petitioner also attached a page from a Form 1040X, Amended U.S. Individual Income Tax Return, on which he attempted to revoke his purported I am a nonresident alien individual who at no time during the year was either engaged in or received gross income that was effectively connected with the conduct of a trade or business within the political jurisdiction of the United States and pursuant to the authority of
Petitioner did not file any nonfrivolous Federal income tax returns for taxable years 1991 and 1992. Using third-party information returns and a bank deposits analysis, respondent determined tax deficiencies and additions to tax for petitioner's taxable years 1991 and 1992 as follows:
*2*Additions to Tax | |||
Year | Deficiency | ||
1991 | $ 33,519 | $ 8,380 | $1,929 |
1992 | 61,440 | 15,360 | 2,683 |
Petitioner earned nonemployee compensation of $ 18,563 during 1991, had capital gains of $ 1,577 and $ 17,240 during 1991 and 1992, respectively, and had other income of $ 494 and $ 1,995 during 1991 and 1992, respectively. On the basis of bank deposits, petitioner also had gross receipts from a business activity of $ 77,961 and $ 165,695 respectively, for his 1991 and 1992 taxable years.
On March 31, 1994, using the addresses on petitioner's earlier correspondence, respondent sent petitioner a notice of deficiency for petitioner's taxable years 1991 and 1992 (notice of deficiency) to three different *176 addresses: (a) 900 Rancho Vista Drive, Grants Pass, Oregon 95726-3746 (Grants Pass address); (b) P.O. Box 665, Rogue River, Oregon 97537; (c) 510 E. Main, Suite 2, Rogue River, Oregon 97537. All three of the envelopes containing the notice of deficiency were returned with a postage label that stated "Moved Left No Address Unable To Forward Return to Sender." The record contains copies of the returned envelopes. At that time petitioner had not filed a Federal income tax return for any taxable year after 1991, but the Grants Pass address is the address petitioner used on the 1040NR he submitted to respondent.
The tax liabilities for 1991 and 1992, including additions to tax, were assessed on September 12, 1994. On May 9, 1994, respondent assessed against petitioner a penalty of $ 500 under
On November 21, 2003, respondent sent petitioner a final notice of intent to levy and notice of his right to a hearing regarding his tax liabilities for taxable years 1991 and 1992 including the frivolous return penalty for 1992.
On November 24, 2003, respondent issued a notice of Federal tax lien *177 regarding the 1991 and 1992 income tax liabilities and the frivolous return penalty for 1992. On November 28, 2003, respondent sent petitioner a notice of the filing of a Federal tax lien and of his right to a hearing regarding the lien.
On December 22, 2003, petitioner timely mailed to respondent a Form 12153, Request for a Collection Due Process Hearing, in which he requested a face-to-face meeting (Appeals hearing request). In his Appeals hearing request petitioner contended that the proposed collection actions were inappropriate in part because he had six dependent children and little income. He did not substantiate his claims.
On May 19, 2004, respondent's Appeals Office (Appeals Office) sent petitioner a letter scheduling a correspondence hearing for June 9, 2004. The letter stated that if petitioner wanted a face-to-face meeting, he had to submit to the Appeals Office by June 2, 2004, the specific collection alternatives he was proposing and a completed and signed financial information statement with all necessary attachments. The letter further stated that the Appeals Office would not consider collection alternatives unless petitioner filed tax returns for 1993 through 2003. *178 Respondent attached to the letter a computerized transcript for each of the periods in issue.
In a letter dated May 26, 2004, petitioner responded to the settlement officer assigned to the case by the Appeals Office. In his response petitioner contended that the requested face-to-face meeting "was (and is) not for you to hear a response from me to you about your allegations, but rather for us to hear you explain why you have made these false accusations and taken these wrongful actions against me." Petitioner also asserted that he had not received the notice of deficiency and challenged the underlying tax liability. Petitioner claimed that during the years in issue he had several dependents and low pay and did not owe any income tax. Petitioner asserted that he could produce documentation to support his claim that he did not owe income tax for the years in issue. Petitioner did not provide, at the administrative level or at trial, any testimony or documentary evidence to dispute the underlying tax liability set out in the notice of deficiency. Petitioner did not propose specific collection alternatives, nor did he provide the requested financial information and tax returns.
On July 8, *179 2004, the settlement officer sent petitioner two notices of determination upholding the lien and levy to collect petitioner's 1991 and 1992 tax liabilities, including the frivolous return penalty. The notices stated that: (1) Respondent had followed all administrative, procedural, and statutory requirements in filing the notice of Federal tax lien and issuing the notice of intent to levy; (2) petitioner had failed to successfully challenge the assessed liabilities; (3) petitioner had failed to propose a viable collection alternative; and (4) the proposed collection actions balanced the need for efficient tax collection with petitioner's concern that they not be more intrusive than necessary.
This Court does not have jurisdiction to review a
II.
At a hearing requested under
Where the validity of the underlying tax liability is properly in issue, the Court will review the matter de novo.
Respondent concedes that petitioner did not receive a copy of the notice of deficiency when it was mailed to him during 1994 and that petitioner's underlying tax liability is properly in issue. As a general rule, the Commissioner's determinations in a notice of deficiency are presumed correct,
Respondent's revenue agent who conducted the audit of petitioner's taxable years 1991 and 1992 testified at trial. The revenue agent indicated that she used third-party information returns and a bank deposits analysis to determine petitioner's tax deficiencies for 1991 and 1992. Respondent introduced copies of petitioner's bank statements and a summary of the third-party information returns upon which the 1991 and 1992 deficiencies were based. Respondent provided a minimal evidenciary foundation linking petitioner to the income that respondent sought to tax, so the presumption of correctness applies. Petitioner did not offer any evidence at trial to refute respondent's determination of petitioner's *184 unreported income. On the basis of the record, petitioner has failed to show that respondent's determination of deficiencies in petitioner's income tax for 1991 and 1992 was not correct.
The only arguments that petitioner has raised are frivolous tax-protester type arguments. We do not address petitioner's frivolous and groundless arguments with "somber reasoning and copious citation of precedent; to do so might suggest that these arguments have some degree of colorable merit." See
Also to be decided is whether petitioner is liable for the additions to tax assessed by respondent under
Even where a taxpayer failed to file a return, the taxpayer may be relieved of the addition to tax if he can demonstrate that the "failure is due to reasonable cause and not due to willful neglect".
We conclude that respondent's determination of petitioner's underlying tax liabilities for 1991 and 1992, as set out in the notice of deficiency, is correct. Respondent's settlement officer verified that the requirements of
To reflect the foregoing,
1. Unless otherwise indicated, all section references are to the Internal Revenue Code, and all Rule references are to the Tax Court Rules of Practice and Procedure.
2.
3. To the extent that this Court does not have jurisdiction, the appeal must be filed in the appropriate District Court. See
4. For court proceedings arising in connection with examinations commenced after July 22, 1998, the Commissioner has the burden of production with respect to additions to tax.
5. Petitioner's Form 1040NR and Form 1040X were not valid tax returns for purposes of
Glenn Crain v. Commissioner of Internal Revenue , 737 F.2d 1417 ( 1984 )
Wagenknecht v. United States , 533 F.3d 412 ( 2008 )
United States v. Boyle , 105 S. Ct. 687 ( 1985 )
Robert D. Beard v. Commissioner of Internal Revenue , 793 F.2d 139 ( 1986 )
Welch v. Helvering , 54 S. Ct. 8 ( 1933 )
Sego v. Commissioner , 114 T.C. 604 ( 2000 )
Lunsford v. Comm'r , 117 T.C. 183 ( 2001 )
Goza v. Commissioner , 114 T.C. 176 ( 2000 )