T.C. Memo. 2002-60
UNITED STATES TAX COURT
DALE I. DIRKES, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 11925-98. Filed February 28, 2002.
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) and Rules 180, 181, and 183.1 The Court agrees with
1
Unless otherwise indicated, section references are to the
Internal Revenue Code in effect for the year in issue, and Rule
references are to the Tax Court Rules of Practice and Procedure.
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and adopts the opinion of the Special Trial Judge, which is set
forth below.
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 an objection to the motion.
Background
On April 7, 1998, respondent sent a notice of deficiency to
petitioner determining a deficiency in his Federal income tax for
1994 of $23,543, and additions to tax pursuant to section
6651(a)(1) and section 6654(a) of $3,498.50 and $671.13,
respectively. Respondent determined that petitioner failed to
timely file his Federal income tax return for 1994, failed to pay
estimated taxes, and failed to report the following amounts
includable in his income:
Capital gains $60,628
Wages 37,323
Respondent also determined that petitioner was entitled to a
standard deduction of $3,175 and an exemption of $1,862.
Petitioner timely filed his petition with the Court on July
6, 1998, in which he 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 thirty-
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seven thousand, three hundred and twenty-
three dollars, ($37,323), in wages.
B. The Commissioner has erroneously
alleged that the petitioner received a
capital gain of sixty thousand, six hundred
and twenty-eight dollars, ($60,628).
* * * * * * *
D. The Commissioner has erroneously
alleged that the petitioner owes a
delinquency penalty of three thousand, four
hundred ninety-eight dollars and fifty cents,
($3,498.50), pursuant to Internal Revenue
Code Sec. 6651(a)(1).
E. The Commissioner has erroneously
alleged that petitioner owes a penalty of six
hundred seventy-one dollars and thirteen
cents, ($671.13), for failure to file
quarterly estimates pursuant to Internal
Revenue Code Sec. 6654.
Further, petitioner alleges:
5. The facts upon which 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 less than
twenty thousand dollars, ($20,000). This
compensation consisted of approximately
eleven, (11), days of regular wages with the
remaining compensation deriving from the
exercise of Incentive Stock Option(s).
Petitioner is without documentation
sufficient to produce a more detailed
analysis of said compensation.
* * * * * * *
C. The petitioner’s failure to file
federal income tax returns in a timely manner
is not due to or resultant from willful
neglect.
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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 of
the statutory notice of deficiency. Thus, this adjustment is no
longer at issue.
The notice of deficiency allowed petitioner a standard
deduction of $3,175 based on “married filing separate” status.
Respondent concedes that petitioner should be allowed a standard
deduction of $3,800 based upon “single” filing status. This
adjustment is not at issue.
For the purpose of this motion, respondent concedes the
sections 6651(a)(1) and 6654(a) additions to tax. Thus, these
adjustments are no longer at issue.
Before respondent filed the motion for summary judgment,
petitioner filed a reply to respondent’s answer to the petition
in which he avers:
2. On or about September 29, 1998, Petitioner
received his W2 forms for the first time from his
previous employer, MCI Communications Corporation
* * *. Those W2's indicate that Petitioner’s total
income for the calendar year 1994 was thirty-seven
thousand, three hundred twenty-three dollars and eleven
cents, ($37,323.11). This income includes all
Incentive Stock Options, (ICO’s), exercised in calendar
year 1994.
The notice of deficiency included in petitioner’s income
wages of $37,323 for 1994. Pursuant to petitioner’s admission in
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paragraph 2 of his reply to respondent’s answer, he is deemed to
have conceded that amount. Thus, these wages are no longer in
issue.
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 Fla. 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
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 stated, the issues framed by the pleadings in
this case are: (1) Whether petitioner failed to report capital
gain of $60,628; (2) whether he failed to report wages of
$37,323; (3) whether he is allowed an exemption of $1,862; (4)
whether he is allowed a standard deduction of $3,175; (5) whether
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he is liable for an addition to tax pursuant to section
6651(a)(1) of $3,498.50; and (6) whether he is liable for an
addition to tax pursuant to section 6654(a) of $671.13.
For the purpose of this motion, respondent concedes the
capital gain adjustment of $60,628, and petitioner admits having
received wages of $37,323 from MCI for 1994.
Based on decreased adjusted gross income resulting from
respondent’s concessions, respondent concedes that petitioner is
entitled to an exemption in the amount of $2,450. This
adjustment is not at issue.
Respondent concedes that petitioner is entitled to a
standard deduction of $3,800 based upon “single” filing status.
This adjustment is not at issue.
Respondent concedes that petitioner is not liable for
additions to tax pursuant to sections 6651(a)(1) and 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.
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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.