T.C. Memo. 1996-143
UNITED STATES TAX COURT
WAYNE CURTIS MCKEE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 3730-94. Filed March 21, 1996.
Wayne Curtis McKee, pro se.
Christal W. Hillstead, for respondent.
MEMORANDUM OPINION
DINAN, Special Trial Judge: This case was heard pursuant
to the provisions of section 7443A(b)(3) and Rules 180, 181, and
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182.1 Respondent determined deficiencies in petitioner's Federal
income tax and additions to tax as follows:
______Additions to Tax_______
Year Deficiency Sec. 6651(a) Sec. 6654
1989 $2,119 $530 $144
1990 2,456 614 160
1991 2,584 100 ---
The issues for decision are: (1) Whether petitioner is
liable for Federal income taxes on wages received during the
years in issue; (2) whether section 6501 bars the assessment and
collection of taxes when a taxpayer fails to file returns; (3)
whether petitioner is liable for additions to tax pursuant to
section 6651(a); and (4) whether petitioner is liable for
additions to tax pursuant to section 6654.
Some of the facts have been stipulated and are so found.
The stipulations of fact and attached exhibits are incorporated
herein by this reference. Petitioner resided in Sumner,
Washington, on the date the petition was filed in this case.
Petitioner failed to file Federal income tax returns for the
taxable years 1989, 1990, and 1991, despite having received wages
in the amounts of $19,214.85, $21,674.30 and $22,786.62 for those
years, respectively. Respondent determined deficiencies in
1
Unless otherwise indicated, all section references are
to the Internal Revenue Code in effect for the taxable years in
issue. All Rule references are to the Tax Court Rules of
Practice and Procedure.
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petitioner's Federal income taxes and additions to tax based on
Forms W-2 filed by petitioner's employer.
In his petition, petitioner raised traditional "tax
protester" type arguments. He maintains that reporting and
paying income taxes is strictly voluntary; that the 5th Amendment
to the Constitution of the United States prevents respondent from
requiring him to provide the information called for on an income
tax return; and it is the Government's responsibility to
calculate his taxes and send him a bill within 60 days of the
year's end.
The first issue for decision is whether petitioner is liable
for Federal income taxes on his wages. Respondent's
determinations as to petitioner's tax liability is presumed to be
correct, and petitioner bears the burden of proving otherwise.
Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).
Section 61 defines gross income as all income from whatever
source derived. Included within the definition of gross income
is "compensation for services". Sec. 61(a)(1). During the
taxable years 1989, 1990, and 1991, petitioner received taxable
wages. Sec. 61.
All of petitioner's arguments have been rejected repeatedly
by the courts. There is no doubt that petitioner was required to
file income tax returns for the years in issue and that he was
required to pay taxes on his wages. See secs. 1, 61, 6011, 6012,
7701(a). Petitioner is a classic tax protester raising
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traditional protester arguments. See Crain v. Commissioner, 737
F.2d 1417 (5th Cir. 1984). In Crain v. Commissioner, supra at
1417, when a tax protester raised similar arguments, the Court of
Appeals for the Fifth Circuit opined: "We perceive no need to
refute theses arguments with somber reasoning and copious
citation of precedent; to do so might suggest that these
arguments have some colorable merit." We agree.
This Court, as well as the Ninth Circuit, have held
petitioner's arguments to be nothing more than tax protester
rhetoric and legalistic gibberish. See Fuller v. United States,
786 F.2d 1437 (9th Cir. 1986); Hudson v. United States, 766 F.2d
1288 (9th Cir. 1985); McCoy v. Commissioner, 76 T.C. 1027 (1981),
affd. 696 F.2d 1234 (9th Cir. 1983); United States v. Romero,
640 F.2d 1014 (9th Cir. 1981); Woods v. Commissioner, 91 T.C. 88
(1988); Abrams v. Commissioner, 82 T.C. 403 (1984); Rowlee v.
Commissioner, 80 T.C. 111 (1983); Snyder v. Commissioner, T.C.
Memo. 1995-405; Devon v. Commissioner, T.C. Memo. 1995-206;
McGanty v. Commissioner, T.C. Memo. 1995-178; Diehl v.
Commissioner, T.C. Memo. 1990-48.
The next issue for decision is whether the statute of
limitations bars assessment where petitioner has failed to file
returns. Petitioner contends that the tax liability for the
taxable years in issue are uncollectible because respondent
failed to make an assessment within 60 days of the end of the
taxable year. Respondent contends otherwise.
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Pursuant to section 6501((3), in the case of the failure to
file a return, the tax may be assessed or a proceeding in court
for the collection of such tax may be begun without assessment at
any time. Accordingly, respondent is sustained on this issue
The third issue for decision is whether petitioner is liable
for section 6651(a)(1) additions to tax. Section 6651(a)(1)
imposes an addition to tax for failure to timely file a return,
unless the taxpayer establishes: (1) The failure did not result
from "willful neglect"; and (2) the failure was "due to
reasonable cause". "Willful neglect" has been interpreted to
mean a conscious, intentional failure, or reckless indifference.
United States v. Boyle, 469 U.S. 241, 245-246 (1985).
"Reasonable cause" requires the taxpayer to demonstrate that he
exercised ordinary business care and prudence and was nonetheless
unable to file a return within the prescribed time. United
States v. Boyle, supra at 246; sec. 301.6651-1(c)(1), Proced. and
Admin. Regs. The addition to tax equals 5 percent of the tax
required to be shown on the return for the first month, with an
additional 5 percent for each additional month or fraction of a
month during which the failure to file continues, not to exceed a
maximum of 25 percent. Sec. 6651(a)(1).
Petitioner made no attempt to comply with the law.
Accordingly, respondent's determinations with respect to the
additions to tax under section 6651(a) are sustained.
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The final issue for decision is whether petitioner is liable
for the additions to tax imposed under section 6654. Respondent
determined that petitioner was liable for additions to taxes
under section 6654(a) for failure to pay estimated income tax for
the years in issue. Where payments of tax, either through
withholding or by making estimated quarterly tax payments during
the course of the year, do not equal the percentage of total
liability required under the statute, imposition of the addition
to tax under section 6654 is automatic, unless petitioner shows
that one of the statutory exceptions apply. Niedringhaus v.
Commissioner, 99 T.C. 202, 222 (1992); Grosshandler v.
Commissioner, 75 T.C. 1, 20-21 (1980). Petitioner bears the
burden to show qualification for such exception. Habersham-Bey
v. Commissioner, 78 T.C. 304, 319-320 (1982). Petitioner has not
sustained this burden. Petitioner's employer did not withhold
any Federal income taxes from petitioner's 1989, 1990 or 1991
wages because petitioner filed "exempt" status. Petitioner did
not make any estimated tax payments for the years in issue.
Accordingly, we hold that petitioner is liable for the additions
to tax under section 6654 for the years in issue.
To reflect the foregoing,
Decision will be entered
for respondent.