T.C. Memo. 1996-60
UNITED STATES TAX COURT
JAMES V. & MELINDA S. EDMISTON, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 1760-94. Filed February 15, 1996.
James V. Edmiston, pro se.
Margaret S. Rigg, for respondent.
MEMORANDUM OPINION
DEAN, Special Trial Judge: This case was heard pursuant to
the provisions of section 7443A(b) of the Code and Rules 180,
181, and 182.1
1
All section references are to the Internal Revenue Code in
effect for the taxable year in issue. All Rule references are to
the Tax Court Rules of Practice and Procedure.
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Respondent determined a deficiency in petitioners' 1991
Federal income tax in the amount of $5,018 and an accuracy-
related penalty under section 6662(a) in the amount of $1,004.
The issues for decision are: (1) Whether petitioners are
entitled to deduct for the year 1991, Schedule C expenses
totaling $27,720;2 and (2) whether petitioners are liable for the
accuracy-related penalty under section 6662 due to negligence or
disregard of rules or regulations.
Some of the facts have been stipulated and are so found.
The Stipulation of Facts and the exhibits attached thereto are
incorporated herein by reference.
Petitioners resided in Redwood City, California, at the time
the Petition was filed. Petitioners filed a joint individual
income tax return, Form 1040, for the year 1991. Attached to the
return is a Schedule C for "Edmiston Enterprises" listing total
business expenses of $27,720.
Petitioner, Melinda S. Edmiston did not appear at trial and
did not sign the stipulation of facts in this case. Respondent
orally moved to dismiss her for failure to properly prosecute her
case. Respondent's motion will be granted.
2
Petitioners' entitlement to the "Earned Income" credit
under sec. 32 as well as their liability for the tax on self-
employment income under secs. 1401-1403 and their entitlement to
the deduction under sec. 164(f) of one-half the amount, if any,
of any self-employment tax imposed, is dependent upon our
resolution of this issue.
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We decide this case based upon the basic principle that the
burden of establishing error in the deficiency notice or
establishing claims raised in the petition or at trial rests upon
petitioner. Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115
(1933).
Apart from the few facts that were stipulated, there is no
probative evidence in the record. Almost all of Mr. Edmiston's
testimony at trial may be characterized as tax "protester"
rhetoric. He questioned the validity of his joint individual
income tax return because of the absence of OMB (Office of
Management and Budget) numbers from Form 1040 and stated his
belief that only Federal employees are subject to Federal income
tax. We see no need to address these or similar arguments of
petitioner. See Crain v. Commissioner, 737 F.2d 1417 (5th Cir.
1984).
Petitioner, in response to a question by the Court, did
testify that during the year 1991 he was involved in certain
"business ventures". He testified that he was "selling land in
LA for a company named EIC" and doing "undercover work" for
banks. Petitioner further testified that he had "substantial"
expenses, connected with these activities, that he correctly
reported. At trial, however, Mr. Edmiston presented no
documentation to substantiate any of his claimed Schedule C
expenses.
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Petitioner has failed to carry his burden of proof and
respondent's determinations are therefore sustained.
To reflect the foregoing,
An appropriate order and
decision will be entered for
respondent.