T.C. Memo. 2003-119
UNITED STATES TAX COURT
BRIAN HILVETY, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 2568-02. Filed April 28, 2003.
Brian Hilvety, pro se.
Kathleen C. Schlenzig, for respondent.
MEMORANDUM OPINION
CHIECHI, Judge: Respondent determined the following defi-
ciency in, and additions to, petitioner’s Federal income tax
(tax):1
1
Respondent also determined interest on the amounts of those
items as provided by law.
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Additions to tax
Year Deficiency Sec. 6651(a)(1)2 Sec. 6651(a)(2) Sec. 6654(a)
1997 $3,088 $694.35 $570.91 $166.23
The issues remaining for decision are:3
(1) Does petitioner have unreported wage income for his
taxable year 1997? We hold that he does.
(2) Is petitioner liable for his taxable year 1997 for an
addition to tax under section 6651(a)(1)? We hold that he is.
(3) Is petitioner liable for his taxable year 1997 for an
addition to tax under section 6654(a)? We hold that he is.
Background
Some of the facts have been stipulated and are so found.
Petitioner had a mailing address in Moweaqua, Illinois, at
the time he filed the petition.
During 1997, R.W.P. Enterprises, Inc., d/b/a Rat’s Whole
Place, paid petitioner wages of $11,130. That company withheld
from those wages FICA tax and Medicare tax of $690 and $161,
respectively.
During 1997, Trading Specialties International, Inc., paid
petitioner wages of $15,522. That company withheld from those
2
All section references are to the Internal Revenue Code in
effect for the year at issue. All Rule references are to the Tax
Court Rules of Practice and Procedure.
3
Respondent concedes that petitioner is not liable for his
taxable year 1997 for an addition to tax under sec. 6651(a)(2).
Respondent conceded in the parties’ stipulation of facts that
petitioner had prepaid credits in excess of those determined in
the notice of deficiency (notice) issued to him for that year.
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wages Federal income tax, FICA tax, and Medicare tax of $2, $962,
and $225, respectively.
During 1997, World of Powersports, Inc., paid petitioner
wages of $38. That company withheld from those wages FICA tax of
$2.
During 1997, petitioner did not make any estimated tax
payments to the Internal Revenue Service.
Petitioner did not file a tax return for his taxable year
1997.
On January 31, 2002, petitioner filed the petition in this
case. The petition contains allegations, contentions, arguments,
and questions that the Court finds to be frivolous and/or ground-
less.
On March 7, 2003, respondent submitted respondent’s trial
memorandum in this case. Attached to respondent’s trial memoran-
dum was a copy of a draft of a stipulation of facts proposed by
petitioner (petitioner’s proposed stipulation of facts) as well
as petitioner’s cover letter dated February 28, 2003, transmit-
ting such proposed stipulation of facts to respondent’s counsel
(petitioner’s February 28, 2003 transmittal letter).
In an Order dated March 10, 2003 (March 10, 2003 Order), the
Court ordered respondent’s trial memorandum, including the
attachments thereto, to be filed as of the date of receipt by the
Court. In that Order, the Court found that certain statements
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and arguments set forth in petitioner’s proposed stipulation of
facts and petitioner’s February 28, 2003 transmittal letter are
frivolous and/or groundless. In the March 10, 2003 Order, the
Court reminded petitioner about section 6673(a) and admonished
him that, in the event he continued to advance frivolous and/or
groundless contentions and arguments, the Court would be inclined
to impose a penalty not in excess of $25,000 on him under section
6673(a)(1).
On March 10, 2003, petitioner submitted petitioner’s trial
memorandum to the Court. In an Order dated March 11, 2003 (March
11, 2003 Order), the Court ordered petitioner’s trial memorandum
to be filed as of the date of receipt by the Court. In that
Order, the Court found that petitioner’s trial memorandum set
forth issues, statements, contentions, and arguments that are
frivolous and groundless. In the Court’s March 11, 2003 Order,
the Court reminded petitioner about its March 10, 2003 Order and
issued a second reminder to petitioner about section 6673(a) and
a second admonition to him that, in the event he continued to
advance frivolous and/or groundless statements, contentions, and
arguments, the Court would be inclined to impose a penalty not in
excess of $25,000 on him under section 6673(a)(1).
On March 24, 2003, at the call of this case from the calen-
dar (calendar call) at the Court’s trial session in Chicago,
Illinois, the Court again reminded petitioner that, in the event
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he advanced frivolous and/or groundless contentions and arguments
at trial, the Court would impose a penalty on him under section
6673(a)(1). The Court also advised petitioner at the calendar
call that, in the event he advanced such types of contentions and
arguments at trial, as opposed to presenting facts that are
relevant to resolving the issues remaining in the instant case,
the Court would probably not allow him to testify about such
frivolous and/or groundless contentions and arguments.
On March 24, 2003, this case was called for trial. Peti-
tioner was the only witness. The following colloquy took place
between the Court and petitioner during petitioner’s testimony:
THE COURT: * * * Mr. Hilvety, you may now testify
to any facts that are relevant to resolving the deter-
minations in the notice of deficiency that remain at
issue in this case.
THE WITNESS: Well, the fact is that the notice of
deficiency is deficient on its face because it has no
section listed for the deficiency.
THE COURT: That’s a legal argument. I want any
facts that you want to testify to that * * * [are]
relevant to resolving the issues that remain in this
case.
THE WITNESS: Well, the Internal Revenue Service
is required to state what the tax is derived from under
section 62--
THE COURT: That’s an argument, and it’s a frivo-
lous argument, and I told you this morning and I’ll
tell you now. I’ll give you one more chance, and
unless you’re going to start testifying to facts that
are relevant to resolving the issues in this case as
opposed to making frivolous and/or groundless conten-
tions and arguments, you will be excused from testify-
ing altogether, and I will entertain a motion to dis-
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miss for failure to properly prosecute this case.
Do you understand what I’m saying to you?
THE WITNESS: Yes, I do.
THE COURT: Okay. Now, what facts that are rele-
vant to resolving the issues that remain in this case
do you want to testify about?
THE WITNESS: In light * * * [of] what you’ve just
said, I have nothing else.
On cross-examination, the following dialogue took place
between respondent’s counsel and petitioner:
Q Mr. Hilvety, you did not file a tax return for
taxable year 1997, did you?
A I could not find in the Internal Revenue Code
anywhere where I was required by law, written by Con-
gress, to file a return.
Q Sir, did you or did you not file a tax return
for 1997?
* * * * * * *
THE WITNESS: No, I did not.
The Court did not order any posttrial briefs in this case.
Nonetheless, on March 26, 2003, petitioner submitted to the Court
a document that the Court had filed as petitioner’s supplement to
petitioner’s trial memorandum (petitioner’s supplement). Peti-
tioner’s supplement contains questions, statements, contentions,
and arguments that the Court finds to be frivolous and/or ground-
less. Petitioner’s supplement also argues for the first time
that respondent mailed the notice to him with respect to his
taxable year 1997 after the period of limitations prescribed by
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section 6501 for that year had expired.
Discussion
Petitioner has introduced no credible evidence with respect
to any factual issue relevant to ascertaining whether the deter-
minations in the notice are erroneous. We find that petitioner
has the burden of proving that those determinations are wrong.
Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933); sec.
7491(a).
Petitioner proffered no evidence and advanced no argument
establishing that respondent’s determination that he had wage
income for 1997 totaling $26,690 is in error. Indeed, petitioner
concedes in the parties’ stipulation of facts in this case that
he had that amount of wage income for that year.
Nor has petitioner proffered any evidence or advanced any
argument establishing that respondent is wrong in determining
that he is liable for his taxable year 1997 for additions to tax
under sections 6651(a)(1) and 6654(a).4
We now turn to section 6673(a)(1), a provision that the
Court brought to petitioner’s attention several times both before
and during the trial in this case. The Court specifically
advised petitioner before and during trial that the questions,
4
Petitioner conceded on cross-examination at trial and in
petitioner’s supplement to petitioner’s trial memorandum that he
did not file a return for his taxable year 1997. We conclude
that respondent has satisfied respondent’s burden of production
under sec. 7491(c).
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statements, contentions, and arguments that he was advancing in
his trial memorandum and that he attempted to advance at trial
were frivolous and/or groundless. Moreover, the Court reminded
petitioner before and during trial about section 6673(a)(1) and
admonished him that, in the event he continued to make frivolous
and/or groundless statements, contentions, and arguments, the
Court would be inclined to impose a penalty on him under that
section. Nonetheless, petitioner persisted throughout the course
of the proceedings in this case in advancing frivolous and/or
groundless questions, statements, contentions, and arguments.
Section 6673(a)(1) authorizes the Court to impose a penalty
in favor of the United States in an amount not to exceed $25,000
whenever it appears that a taxpayer’s position in a proceeding is
frivolous and/or groundless or that the taxpayer institutes or
maintains a proceeding in the Court primarily for delay.
On the instant record, we find that petitioner’s position in
this case is frivolous and/or groundless5 and that he instituted
and maintained this proceeding primarily for delay. Accordingly,
we shall impose a penalty on petitioner under section 6673(a)(1)
in the amount of $500.
5
Although not pled in the petition, petitioner argues for
the first time in petitioner’s supplement to petitioner’s trial
memorandum that the period of limitations under sec. 6501 with
respect to his taxable year 1997 has expired. That argument is
groundless. Petitioner did not file a tax return for 1997. We
hold that the period of limitations for that year has not ex-
pired. Sec. 6501(c)(3).
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We have considered all of petitioner’s contentions, argu-
ments, and requests that are not discussed herein, and we find
them to be without merit and/or irrelevant.
To reflect the foregoing and respondent’s concession,
Decision will be entered under
Rule 155.