T.C. Memo. 2005-62
UNITED STATES TAX COURT
JONATHAN KAPLOWITZ, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 542-04L. Filed March 29, 2005.
Jonathan Kaplowitz, pro se.
Sandra K. Reid and Monica J. Miller, for respondent.
MEMORANDUM OPINION
PANUTHOS, Chief Special Trial Judge: This matter is before
the Court on respondent’s motion to dismiss for failure to state
a claim upon which relief can be granted pursuant to Rule 40 and
petitioner’s motion for partial summary judgment.1
1
Section references are to sections of the Internal
(continued...)
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Background2
Petitioner failed to file Federal income tax returns for the
taxable years 1996 through 2000. A notice of deficiency was
issued on June 19, 2002, determining deficiencies and additions
to tax for the taxable years 1996 through 2000. Petitioner
received the notice of deficiency and acknowledged receipt to
representatives of respondent. A timely petition was not filed
with this Court in response to the June 19, 2002, notice of
deficiency. The deficiencies, additions to tax, and interest
were assessed on November 11, 2002.
On August 21, 2003, respondent mailed a Final Notice-–Notice
of Intent to Levy and Notice of Your Right to a Hearing with
regard to petitioner’s tax liabilities for 1996 through 2000.
Petitioner submitted a timely request for hearing. Petitioner
was advised by the Appeals officer that the issue of the
underlying tax liability would not be the subject matter of the
hearing. See sec. 6330(c)(2)(B). Petitioner was also advised
that respondent could consider collection alternatives and that
1
(...continued)
Revenue Code, as amended, and Rule references are to the Tax
Court Rules of Practice and Procedure.
2
The background factual information is derived from
respondent’s determination letter dated Dec. 16, 2003.
Petitioner does not appear to dispute the factual narrative
provided by the IRS Appeals officer with respect to the failure
to file returns, the issuance of a notice of deficiency and a
final notice of intent to levy, and the subsequent hearing held
with the Appeals officer.
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petitioner should file tax returns for the years in issue. A
hearing was conducted with the Appeals officer, and petitioner
presented arguments that he was not subject to income tax and
that there were defects in respondent’s procedures.
On December 16, 2003, respondent issued to petitioner a
Notice of Determination Concerning Collection Action(s) Under
Section 6320 and/or 6330. The notice states that the Appeals
Office determined that it was appropriate to proceed with
collection for 1996 through 2000 as follows:
Unpaid
Year Liability1
1996 $11,562.07
1997 41,312.05
1998 31,040.43
1999 40,107.43
2000 25,793.49
1
Calculated through Nov. 30, 2003.
The letter advised, among other things, that petitioner could be
subject to sanctions pursuant to section 6673(a) for instituting
or maintaining an action primarily for delay or taking a position
that is frivolous or groundless.
On January 12, 2004, petitioner filed with the Court a
petition for lien or levy action seeking review of respondent’s
notice of determination. At the time that the petition was
filed, petitioner resided in Maitland, Florida.
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The petition asserts as error that “a) Failure of the
hearing officer to consider denial of due process at the
examination interview, an evidentiary hearing; b) Failure of the
hearing officer to consider procedural errors committed by the
Examinations Division in creating the Report of Tax Changes.” In
paragraph 5 of the petition, petitioner asserts facts that he
relies on, such as, that he was a “Citizen of the United States
of America”, that he was not engaged in interstate commerce, that
he is a natural person, that he has a Sixth Amendment right to
refute, confront, and cross-examine witnesses, that petitioner
was denied an opportunity during the examination process to raise
a defense against erroneous testimony, that there was no
opportunity to cross-examine witnesses related to documents used
by the examiner, and that he effectively did not have an
opportunity to dispute the tax liability.
Respondent filed a motion to dismiss for failure to state a
claim. Respondent contends that petitioner is barred under
section 6330(c)(2)(B) from challenging the existence or amount of
his tax liability in this proceeding because he received a notice
of deficiency and failed to file a timely petition in response
thereto.
After the petition was filed in response to the
determination letter, respondent filed an answer. Petitioner
filed a lengthy reply which contains primarily frivolous
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objections. Since that time, petitioner has filed numerous
lengthy motions and documents with the Court espousing frivolous
positions. Many of the motions have previously been denied. The
Court set for hearing: (1) Respondent’s motion to dismiss for
failure to state a claim and (2) petitioner’s motion for partial
summary judgment.3
On February 9, 2005, the Court ordered petitioner to show
cause in writing on or before March 4, 2005, why a penalty should
not be imposed pursuant to section 6673(a).
On February 22, 2005, petitioner filed a Verified Motion for
Ruling on Petitioner’s Motion to Set Aside Defaults Against the
petitioner Docketed on July 8, 2004, and a Verified Motion for
Findings of Fact and Conclusions at Law. On February 23, 2005,
petitioner filed a Motion to Postpone Answer to Order of February
9, 2004 Until Court Rules on Petitioner’s Motion to Set Aside IRS
Default Against Petitioner. All three motions contain frivolous
allegations and were summarily denied. In response to the Order
to show cause, petitioner filed a document entitled “Verified
Answer to Order to Show Cause Why Penalty Should Not Be Imposed.”
The document is replete with frivolous allegations.4
3
In October 2004, petitioner filed a petition for writ of
mandamus with the U.S. Court of Appeals for the 11th Circuit.
The writ was denied on Dec. 21, 2004.
4
On the same date petitioner filed a “Verified Motion to
Certify Issues for Review by the U.S. Court of Appeals for the
(continued...)
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Discussion
Section 6331(a) provides that if any person liable to pay
any tax neglects or refuses to pay such tax within 10 days after
notice and demand for payment, the Secretary is authorized to
collect such tax by levy on the person’s property. Section
6331(d) provides that at least 30 days before enforcing
collection by levy on the person’s property, the Secretary is
obliged to provide the person with a final notice of intent to
levy, including notice of the administrative appeals available to
the person.
Section 6330 generally provides that the Commissioner cannot
proceed with collection by levy until the person has been given
notice and the opportunity for an administrative review of the
matter (in the form of an Appeals Office hearing) and, if
dissatisfied, with judicial review of the administrative
determination. See Davis v. Commissioner, 115 T.C. 35, 37
(2000); Goza v. Commissioner, 114 T.C. 176, 179 (2000).
Section 6330(c) prescribes the matters that a person may
raise at an Appeals Office hearing. In sum, section 6330(c)
provides that a person may raise collection issues such as
spousal defenses, the appropriateness of the Commissioner’s
intended collection action, and possible alternative means of
4
(...continued)
Eleventh Circuit”. This motion also contained nothing but
frivolous allegations and was summarily denied.
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collection. Section 6330(c)(2)(B) provides that the existence
and amount of the underlying tax liability can be contested at an
Appeals Office hearing if the person did not receive a notice of
deficiency for the taxes in question or did not otherwise have an
opportunity to dispute the tax liability. See Sego v.
Commissioner, 114 T.C. 604, 609 (2000); Goza v. Commissioner,
supra. Section 6330(d) provides for judicial review of the
administrative determination in the Tax Court or a Federal
District Court, as may be appropriate.
Petitioner first contends that he was unlawfully denied the
opportunity to challenge the existence or amount of his tax
liabilities for the years in question. The record in this case
shows otherwise. As was the case in Goza v. Commissioner, supra,
petitioner received a notice of deficiency for the years in issue
and failed to file a timely petition for redetermination with
this Court. It follows that section 6330(c)(2)(B) bars
petitioner from challenging the existence or amount of the
underlying tax liability in this collection review proceeding.
Even if petitioner were permitted to challenge the underlying tax
liability, his arguments are clearly frivolous.
Petitioner has failed to raise a spousal defense, make a
valid challenge to the appropriateness of respondent’s intended
collection action, or offer alternative means of collection.
These issues are now deemed conceded. Rule 331(b)(4). Further,
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the nature of the Appeals Office hearing does not include the
taking of testimony under oath or the compulsory attendance of
witnesses. Davis v. Commissioner, supra at 41-42. In the
absence of a justiciable issue for review, we conclude that
petitioner has failed to state a claim for relief, and we shall
therefore grant respondent’s motion to dismiss. See Jackson v.
Commissioner, T.C. Memo. 2002-100; Yacksyzn v. Commissioner, T.C.
Memo. 2002-99; Weishan v. Commissioner, T.C. Memo. 2002-88, affd.
66 Fed. Appx. 113 (9th Cir. 2003).
Petitioner’s motion for partial summary judgment does not
raise any justiciable issues. Essentially, petitioner asserts
many of the same frivolous positions set forth in his numerous
documents filed with the Court. The U.S. Court of Appeals for
the Fifth Circuit stated: “We perceive no need to refute these
arguments with somber reasoning and copious citation of
precedent; to do so might suggest that these arguments have some
colorable merit.” Crain v. Commissioner, 737 F.2d 1417, 1417
(5th Cir. 1984). Suffice it to say that petitioner is a taxpayer
who is subject to the Federal income tax on his wages and other
sources of income. See secs. 1(c), 61(a)(1), (11), 7701(a)(1),
(14); Nestor v. Commissioner, 118 T.C. 162, 165 (2002),
supplemented by T.C. Memo. 2002-251. We shall deny petitioner’s
motion for partial summary judgment.
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Section 6673(a) authorizes the Tax Court to require a
taxpayer to pay to the United States a penalty not in excess of
$25,000 whenever it appears that proceedings have been instituted
or maintained by the taxpayer primarily for delay or that the
taxpayer’s position in such proceeding is frivolous or
groundless. Petitioner was specifically warned of the likelihood
of a penalty under section 6673 if he persisted in his frivolous
arguments. Petitioner was ordered to show cause why a penalty
under section 6673(a) should not be imposed. Petitioner’s
response was frivolous. Further, subsequent to the issuance of
the Order to show cause petitioner filed four separate motions,
all of which are frivolous. Petitioner has persisted. Serious
sanctions are necessary to deter petitioner and others similarly
situated. Takaba v. Commissioner, 119 T.C. 285, 295 (2002);
Hamzik v. Commissioner, T.C. Memo. 2004-223. We shall impose a
penalty on petitioner pursuant to section 6673(a) in the amount
of $15,000.
To reflect the foregoing,
An appropriate order and
decision will be entered.