T.C. Memo. 2006-52
UNITED STATES TAX COURT
DAVID H. SAXON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 17981-05. Filed March 23, 2006.
David H. Saxon, pro se.
James L. May, Jr., for respondent.
MEMORANDUM OPINION
JACOBS, Judge: Respondent determined a $130,095.30
deficiency in petitioner’s 2003 Federal income tax, a $29,271.44
addition to tax under section 6651(a)(1), a $7,155.24 addition to
tax under section 6651(a)(2), and a $3,356.85 addition to tax
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under section 6654(a).1 This case is before the Court on
respondent’s motion to dismiss for failure to state a claim upon
which relief can be granted and to impose a penalty under section
6673 (motion to dismiss).
Background
When the petition in this case was filed, petitioner resided
in Maryville, Tennessee.
Petitioner failed to file an income tax return for 2003. In
addition, he failed to pay any tax for 2003, including estimated
income tax.
On September 26, 2005, petitioner filed a petition with the
Court seeking judicial review of respondent’s aforementioned
determination of the deficiency and additions to tax for 2003.
In the petition, petitioner alleges he was required to file a
return only if (1) the Secretary through a designated delegate
obtained approval from the Office of Management and Budget (OMB)
for a valid control number appearing on the form petitioner is
required to file and authorizing the collection of income tax
information and (2) petitioner’s income exceeds the exempt amount
under section 151(d). No meaningful facts supporting
1
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the year at issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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petitioner’s claims of error with respect to respondent’s
determinations for 2003 are contained in the petition.
On October 27, 2005, respondent filed the motion to dismiss,
asserting that in the petition petitioner makes no claims of
factual error and asserts only frivolous law and legal
conclusions. Respondent posits that petitioner has not alleged
any justiciable error with respect to the determinations set
forth in the notice of deficiency or any facts in support of any
error. On December 27, 2005, petitioner filed his notice of
objection to respondent’s motion to dismiss.2
Discussion
Rule 34(b)(4) provides that a petition filed in this Court
shall contain “Clear and concise assignments of each and every
error which the petitioner alleges to have been committed by the
Commissioner in the determination of the deficiency or
liability.” Further, Rule 34(b)(5) provides that the petition
2
Respondent filed a motion to dismiss on similar grounds in
petitioner’s lien and levy case at docket No. 16369-05L
(collection case). A hearing on respondent’s motion in the
collection case was held on Dec. 21, 2005. Petitioner did not
appear at that hearing. On Dec. 23, 2005, the Court entered an
order of dismissal and decision in the collection case. On Dec.
27, 2005, the Court received petitioner’s statement of position
with respect to the collection case. See Rule 50(c).
Although no hearing had been set for arguments on
respondent’s motion to dismiss in this case, on Dec. 27, 2005,
petitioner filed a premature written statement of his position
with respect to respondent’s motion to dismiss. The Court
concludes that a hearing is unnecessary for the proper
disposition of respondent’s motion to dismiss.
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shall contain “Clear and concise lettered statements of the facts
on which the petitioner bases the assignments of error, except
with respect to those assignments of error as to which the burden
of proof is on the Commissioner.” Any issue not raised in the
pleadings is deemed conceded. Rule 34(b)(4); Jarvis v.
Commissioner, 78 T.C. 646 (1982); Gordon v. Commissioner, 73 T.C.
736, 739 (1980). The Court may dismiss a case at any time and
enter a decision against a taxpayer for failure to comply with
the Court’s Rules. Rule 123; see Goza v. Commissioner, 114 T.C.
176 (2000); Klein v. Commissioner, 45 T.C. 308 (1965); Stephens
v. Commissioner, T.C. Memo. 2005-183; White v. Commissioner, T.C.
Memo. 1981-609.
The petition includes allegations that respondent failed to
demonstrate that petitioner is liable for Federal income taxes.
Petitioner claims that he is not liable for Federal income taxes
because the OMB control number, 1545-0074, on the Form 1040, U.S.
Individual Income Tax Return, for 2003 is invalid and does not
comply with the requirements of the Paperwork Reduction Act of
1980 (PRA), 44 U.S.C. secs. 3501-3520 (2000). None of
petitioner’s allegations states a claim on which relief may be
granted.
Claims that violation of the PRA excuses a taxpayer from
filing returns and/or paying taxes have been considered and
universally rejected as meritless by this and other courts. See,
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e.g., James v. United States, 970 F.2d 750, 753 n.6 (10th Cir.
1992); United States v. Neff, 954 F.2d 698, 699 (11th Cir. 1992);
Freas v. Commissioner, T.C. Memo. 1993-552; Andreas v.
Commissioner, T.C. Memo. 1993-551.
Petitioner argues that he is not obligated to pay Federal
income tax because (1) the Internal Revenue Code does not assign
a value to the “exempt amount”, (2) the “exempt amount” appears
in IRS publications and instructions “ex post facto”, and (3) he
is not required “to comply with a law ‘ex post facto’”.
Petitioner’s argument is incomprehensible. If petitioner means
to assert that the taxation of income in excess of the exempt
amount is an ex post facto law in violation of Article I of the
Constitution, that argument has no merit. The constitutional
prohibition against ex post facto laws applies only to penal
legislation that imposes or increases criminal punishment for
conduct predating its enactment. Harisiades v. Shaughnessy, 342
U.S. 580, 594 (1952). The Ex Post Facto Clause is not applicable
in a civil context. Johannessen v. United States, 225 U.S. 227,
242 (1912). The Federal income tax imposed under the Internal
Revenue Code is not penal legislation and does not impose or
increase criminal punishment. Accordingly, imposition of Federal
income tax on income in excess of the exempt amount does not
violate the Ex Post Facto Clause of the U.S. Constitution. See
Karpa v. Commissioner, 909 F.2d 784 (4th Cir. 1990) (retroactive
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increase in penalty imposed for substantial understatement did
not violate the Ex Post Facto Clause of the U.S. Constitution),
affg. T.C. Memo. 1989-535; DiLeo v. Commissioner, 96 T.C. 858,
878 (1991) (amendment of section 6661 does not violate the Ex
Post Facto Clause of the U.S. Constitution), affd. 959 F.2d 16
(2d Cir. 1992); Lyle v. Commissioner, T.C. Memo. 1999-184
(section 86 does not violate the Ex Post Facto Clause of the U.S.
Constitution), affd. without published opinion 218 F.3d 744(5th
Cir. 2002).
Lastly, petitioner maintains that unsubstantiated statements
on Forms 1099 that he received income from third parties are not
sufficient to support respondent’s determinations in the notice
of deficiency because the statements were not made under penalty
of perjury.3 However, when a petition does not contain a
justiciable assignment of error with respect to the
Commissioner’s determination, the Commissioner need not provide
the foundation for his determination. See Roat v. Commissioner,
847 F.2d 1379, 1383 (9th Cir. 1988) (sustaining a Tax Court order
dismissing taxpayers’ case for failure to prosecute). Petitioner
has failed to assign error in the manner required by Rule
34(b)(4) and (5) with respect to any item included in the notice
of deficiency for 2003. Consequently, respondent was entitled to
3
Apparently, respondent determined petitioner’s income for
2003 on the basis of third-party information.
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rely on the third-party information to determine petitioner’s
income for 2003. See sec. 6201(d); Parker v. Commissioner, 117
F.3d 785 (5th Cir. 1997) (when the taxpayer files no return or
other sworn statement denying receipt of unreported income, the
Commissioner has no duty to investigate a third-party payment
report); Silver v. Commissioner, T.C. Memo. 2005-281; Martinez v.
Commissioner, T.C. Memo. 2005-213; White v. Commissioner, T.C.
Memo. 1997-459.
In sum, we find that petitioner failed to state in the
petition any justiciable basis on which this Court may grant him
relief. Because petitioner has failed to state a claim for which
relief can be granted, we shall grant respondent’s motion to
dismiss as to the deficiency in income tax for 2003 in the amount
set forth in the notice of deficiency. See Funk v. Commissioner,
123 T.C. 213, 216-217 (2004) (finding that a petition and an
amended petition failed to state a claim upon which relief could
be granted when they lacked a clear statement of error and
contained “nothing more than frivolous rhetoric and legalistic
gibberish”).
Petitioner’s failure to file and pay tax (including
estimated income tax) was not due to reasonable cause, but rather
due to willful neglect. Accordingly, we find that the additions
to tax under sections 6651(a)(1), 6651(a)(2) and 6654 are
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applicable in the respective amounts set forth in the notice of
deficiency.
Respondent requests that this Court impose a penalty
pursuant to section 6673 because petitioner has instituted this
proceeding primarily for delay. Respondent contends that
petitioner’s position is groundless and/or frivolous, and that
petitioner filed his petition as a protest to paying income
taxes.
Section 6673(a)(1) provides that this Court may require a
taxpayer to pay to the United States a penalty not in excess of
$25,000 whenever it appears that: (1) The taxpayer instituted or
maintained the proceedings primarily for delay; (2) the
taxpayer’s position in the proceeding is frivolous or groundless;
or (3) the taxpayer unreasonably failed to pursue available
administrative remedies.
We have previously imposed a penalty pursuant to section
6673(a)(1) against petitioner for asserting arguments similar to
those advanced herein. In docket No. 16369-05L, petitioner
raised similar frivolous arguments with respect to collection of
his income tax liabilities for 2000, 2001, and 2002, and
respondent filed a motion to dismiss for failure to state a claim
upon which relief can be granted and to impose a penalty under
section 6673. On December 23, 2005, this Court entered an order
of dismissal and decision in docket No. 16369-05L that respondent
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could proceed with the collection of petitioner’s tax liabilities
for 2000, 2001, and 2002, and we imposed a $5,000 penalty
pursuant to section 6673(a)(1).
We find that petitioner has asserted frivolous and
groundless arguments in this proceeding which are similar to
those advanced in his prior case before this Court. We also find
that petitioner instituted this proceeding primarily for delay.
Consequently, we hold that petitioner is liable for a $5,000
penalty pursuant to section 6673(a)(1).
To reflect the foregoing,
An appropriate order of
dismissal and decision will be
entered for respondent.