T.C. Memo. 1996-551
UNITED STATES TAX COURT
CHARLES TESLOVICH, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 7586-95. Filed December 19, 1996.
Charles Teslovich, pro se.
Frank A. Falvo, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
FOLEY, Judge: By notice dated April 10, 1995, respondent
determined deficiencies in and additions to petitioner's Federal
income taxes as follows:
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Additions to Tax
Year Deficiency Sec. 6651(a)(1) Sec. 6654
1988 $5,621 $1,405 $359
1989 35,648 8,912 2,413
1990 5,774 1,444 380
1991 4,421 1,105 254
1992 3,765 941 165
1993 4,552 -- --
All section references are to the Internal Revenue Code in
effect for the years in issue, and all Rule references are to the
Tax Court Rules of Practice and Procedure.
Respondent has conceded that there are no deficiencies and
additions to tax for 1988, 1990, 1991, 1992, and 1993. As a
result, the issues for decision are as follows:
1. Whether petitioner failed to report $104,278 of income
in 1989. We hold that he did.
2. Whether petitioner, pursuant to section 6651(a)(1), is
liable for an addition to tax for failure to file a timely
Federal income tax return. We hold that he is liable.
3. Whether petitioner, pursuant to section 6654, is liable
for an addition to tax for failure to make estimated income tax
payments. We hold that he is liable.
FINDINGS OF FACT
Petitioner resided in Pittsburgh, Pennsylvania, at the time
his petition was filed.
On July 26, 1996, respondent, pursuant to Rule 91(f),
submitted a motion to show cause why proposed facts in evidence
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should not be accepted as established. Respondent attached a
proposed First Stipulation of Facts to the motion. The Court,
pursuant to Rule 91(f), granted respondent's motion and issued an
order requiring petitioner, on or before August 9, 1996, to show
cause why the facts and evidence set forth in the stipulation
should not be accepted as established for purposes of this case.
Petitioner failed to comply with the order. As a result, by
order dated September 4, 1996, the Court deemed the facts
admitted for purposes of this case.
Petitioner maintained brokerage accounts at BC Financial
Corp. and Habersheir Securities, Inc. During 1989, petitioner
received $104,147 in proceeds from the sale of stock held in
these accounts. During this same period, petitioner received
interest income of $67 and $64 from New England Mutual Life
Insurance Co. and Dollar Bank, respectively. Petitioner did not
file a 1989 Federal income tax return.
On April 10, 1995, respondent issued petitioner a notice of
deficiency in which she determined that petitioner was liable for
a deficiency of $35,648 for 1989. She also determined that
petitioner was liable for additions to tax for failure to file a
timely return and for failure to make estimated income tax
payments.
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OPINION
I. Unreported Income
Respondent's notice of deficiency is presumed to be correct,
and the taxpayer bears the burden of proving that it is
erroneous. Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115
(1933). Gross income includes all income from whatever source
derived. Sec. 61(a). Interest income and proceeds from the sale
of stock constitute gross income. Sec. 61(a); secs. 1.61-6(a);
1.61-7(a), Income Tax Regs.
Respondent contends that petitioner failed to report $131 in
interest income and $104,147 in proceeds from the sale of stock.
Petitioner contends that the Internal Revenue Service has
orchestrated a campaign of harassment and false allegations
against him. He, however, failed to present any evidence to
refute respondent's determination and, as a result, has failed to
carry his burden of proof relating to this issue. Accordingly,
we conclude that petitioner received $104,278 of unreported
income in 1989, and the deficiency determined by respondent is
sustained.
II. Addition to Tax for Failure To File a Timely Return
Section 6651(a)(1) imposes an addition to tax for failure to
file a timely return, unless it is shown that such failure is due
to reasonable cause and not due to willful neglect. Petitioner
bears the burden of proving that his failure to file a timely
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return was due to reasonable cause and not willful neglect. Rule
142(a); Baldwin v. Commissioner, 84 T.C. 859, 870 (1985).
Petitioner, however, did not dispute his liability for this
addition to tax. As a result, petitioner has failed to carry his
burden of proof and is liable for the addition to tax.
III. Addition to Tax for Failure To Make Estimated Tax Payments
Section 6654 imposes an addition to tax for failure to make
estimated income tax payments. Petitioner bears the burden of
proving that he paid estimated tax or that an exception applies.
Rule 142(a); Grosshandler v. Commissioner, 75 T.C. 1, 20-21
(1980). Petitioner, however, did not dispute his liability for
this addition to tax. As a result, petitioner has failed to
carry his burden of proof and is liable for the addition to tax.
We have considered the other arguments made by petitioner
and respondent and found them to be either irrelevant or without
merit.
To reflect the foregoing,
Decision will be entered
under Rule 155.