T.C. Memo. 2001-98
UNITED STATES TAX COURT
DALE I. DIRKES, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 11924-98. Filed April 24, 2001.
Dale I. Dirkes, pro se.
Frederick W. Krieg, for respondent.
MEMORANDUM OPINION
DAWSON, Judge: This case was assigned to Special Trial
Judge Daniel J. Dinan pursuant to the provisions of section
7443A(b)(5).1 The Court agrees with and adopts the opinion of
the Special Trial Judge, which is set forth below.
1
Unless otherwise indicated, section references are to
the Internal Revenue Code in effect for the year in issue. Rule
references are to the Tax Court Rules of Practice and Procedure.
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OPINION OF THE SPECIAL TRIAL JUDGE
DINAN, Special Trial Judge: This matter is before the Court
on respondent’s Motion for Summary Judgment filed pursuant to
Rule 121(a). Petitioner filed Petitioner’s Objection to
Respondent’s Motion for Summary Judgment. As explained below, we
will grant respondent’s Motion for Summary Judgment.
Background
On April 7, 1998, respondent mailed a notice of deficiency
to petitioner determining a deficiency in his Federal income tax
for 1993 of $71,280 and additions to tax pursuant to section
6651(a)(1) and section 6654(a) of $13,143 and $2,115.63,
respectively. Respondent determined that petitioner failed to
timely file his income tax return for the year in issue, failed
to pay estimated taxes, and failed to report the following
amounts includable in income:
Capital gain $137,835
Interest 13
Prior year refund 227
Wages 103,582
Respondent also determined that petitioner was entitled to a
standard deduction of $3,100 and that petitioner’s filing status
was “married filing separate return”.
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Petitioner timely filed his petition with the Court on July
6, 1998. In his petition, petitioner alleged, in pertinent part:
4. The determination of the tax set forth in said
notice of deficiency is based upon the following
errors:
A. The Commissioner has erroneously
alleged that the petitioner received two
hundred forty-one thousand, six hundred and
fifty-seven dollars, ($241,657), as total
income.
B. The Commissioner has erroneously
alleged that the petitioner received a
capital gain of one hundred thirty-seven
thousand, eight hundred and thirty-five
dollars, ($137,835).
* * * * * * *
D. The Commissioner has erroneously
alleged that the petitioner owes a
delinquency penalty pursuant to Internal
Revenue Code §6651(a)(1) in the amount of
thirteen thousand, one hundred and forty-
three dollars, ($13,143).
E. The Commissioner has erroneously
alleged that petitioner owes a penalty of two
thousand, one hundred fifteen dollars and
sixty-three cents ($2,115.63), for failure to
file adequate quarterly estimates pursuant to
Internal Revenue Code §6654.
Further, petitioner alleges:
5. The facts upon which the petitioner relies, as
the basis of the petitioner’s case, are as follows:
A. To the best of petitioner’s
information, knowledge and belief, the
petitioner’s total income was approximately
one hundred three thousand, eight hundred
seventy-seven dollars and twenty-four cents,
($103,877.24). This is the sum of the
following:
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Approximate base salary: $70,174.14
Deferred compensation plan: 224.97
Incentive Stock Option (ISO): 33,183.75
Interest: 13.38
Wages for sports officiating: 54.00
Federal income tax refund: 227.00
Total 103,877.24
See exhibits B, C, D, and E.[2]
* * * * * * *
C. The petitioner’s failure to file
federal income tax returns in a timely manner
is not due to or resultant from willful
neglect.
D. The petitioner’s failure to file
federal income tax returns in a timely manner
is due to and resultant from reasonable
cause.
In his Motion for Summary Judgment respondent, for the
purpose of this motion, concedes the capital gain adjustment in
the statutory notice of deficiency in the amount of $137,835
(Adjustment I.A.) and the sections 6651(a)(1) and 6654(a)
additions to tax.
2
Exhibit B consists of four copies of Forms W-2, Wage
and Tax Statement, issued by MCI Communications Corp. to
petitioner for 1993. These Forms W-2 show that petitioner
received wages, tips and other income totaling $103,582.86. This
amount included deferred compensation plan income of $224.97 and
incentive stock options of $33,183.75. Exhibit C is a Form 1099-
INT issued by Community Credit Union to petitioner for 1993
showing that he received interest income of $13.38. Exhibit D is
a Texas Sports Officials, Inc. Officiating Pay Summary showing
that petitioner was paid $54 in 1993. Exhibit E is a Kentucky
Form 1099-G showing that petitioner received a State tax refund
of $227 in 1993.
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The statutory notice of deficiency allowed a standard
deduction of $3,100 for 1993 (Adjustment I.D.) because petitioner
had not filed a 1993 Form 1040, U.S. Individual Income Tax
Return. Subsequently, petitioner substantiated itemized
deductions of $10,880 for an increased deduction of $7,780 over
the statutory notice standard deduction, and respondent concedes
that amount.
The statutory notice of deficiency allowed one exemption and
determined that petitioner’s tax liability was to be determined
using “married filing separate return” tax rates. Petitioner’s
petition assigned no error to these determinations.
Discussion
Summary judgment is appropriate “if the pleadings, answers
to interrogatories, depositions, admissions, and any other
acceptable materials, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that a
decision may be rendered as a matter of law.” Rule 121(b);
Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), affd.
17 F.3d 965 (7th Cir. 1994); Naftel v. Commissioner, 85 T.C. 527,
529 (1985). Summary judgment is intended to expedite litigation
and avoid unnecessary and expensive trials. See Florida Peach
Corp. v. Commissioner, 90 T.C. 678, 681 (1988); Espinoza v.
Commissioner, 78 T.C. 412, 415-416 (1982). The moving party
bears the burden of proving that there is no genuine issue of
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material fact, and factual inferences will be made in a manner
most favorable to the party opposing summary judgment. See
Dahlstrom v. Commissioner, 85 T.C. 812, 821 (1985).
As previously discussed, the issues framed by the pleadings
in this case are: (1) Whether petitioner failed to report
capital gain of $137,835; (2) whether petitioner failed to report
interest income of $13; (3) whether petitioner should have
reported as income a $227 State tax refund; (4) whether
petitioner failed to report wages of $103,582; (5) whether
petitioner is liable for an addition to tax pursuant to section
6651(a)(1) of $13,143; and (6) whether petitioner is liable for
an addition to tax pursuant to section 6654(a) of $2,115.63.
As we have stated, supra, respondent for the purpose of his
motion, concedes the capital gain adjustment of $137,835.
Petitioner admits having received interest income of $13
(petition par. 5.A.).
Petitioner admits having received a (state) tax refund of
$227 (petition par. 5.A.).
Petitioner admits having received wages of $103,636.86
(petition par. 5.A.).3
3
Included in petitioner’s income figure of $103,636.86
is $54 for sports officiating. The $54 is not included in
respondent’s “wages” adjustment of $103,582, and respondent does
not assert a claim for the amount.
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Respondent concedes that petitioner is not liable for an
addition to tax pursuant to section 6651(a)(1).
Respondent concedes that petitioner is not liable for an
addition to tax pursuant to section 6654(a).
Conclusion
For the reasons stated herein, we find and hold that there
is no genuine issue as to any material fact remaining for
litigation in this case and that a decision may be rendered as a
matter of law.
To reflect the foregoing,
An order granting
respondent’s motion for
summary judgment will be
issued, and decision will
be entered pursuant to
Rule 155.