T.C. Memo. 2006-257
UNITED STATES TAX COURT
WILLIAM EDWARD THOMASON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent*
Docket No. 7337-05L. Filed November 28, 2006.
P filed a petition for judicial review pursuant to
sec. 6330, I.R.C., in response to a determination by R
that levy action was appropriate. The Court sustained
R’s determination in a bench opinion rendered on a
motion for summary judgment. R subsequently filed a
motion for imposition of a penalty under sec. 6673,
I.R.C.
Held: A penalty under sec. 6673, I.R.C., is due
from P and is awarded to the United States in the
amount of $1,500.
William Edward Thomason, pro se.
John D. Davis, for respondent.
*
This opinion supplements the bench opinion previously
rendered in this case on August 30, 2006, in Pocatello, Idaho.
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SUPPLEMENTAL MEMORANDUM OPINION
WHERRY, Judge: The petition in this case was filed in
response to a Notice of Determination Concerning Collection
Action(s) Under Section 6320 and/or 6330.1 The matter is
presently before the Court on respondent’s motion for imposition
of a penalty under section 6673.
Background
Relevant background information may be summarized as
follows. Petitioner failed to file Federal income tax returns
for the 1987 to 1992 taxable years. On May 9, 1994, the Internal
Revenue Service (IRS) issued to petitioner a statutory notice of
deficiency for those years. Petitioner at no time alleged that
he did not receive the notice.
No petition was filed with the Tax Court in response to the
May 9, 1994, notice, and the deficiencies and additions to tax
determined therein, as well as statutory interest, were assessed
on November 14, 1994. Notices of balance due were sent to
petitioner for all years on that date and on December 19, 1994,
January 23, 1995, and February 27, 1995.
Respondent subsequently issued to petitioner with respect to
his 1987 through 1992 income tax liabilities a Final Notice of
1
Unless otherwise indicated, section references are to the
Internal Revenue Code of 1986, as amended.
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Intent To Levy and Notice of Your Right to a Hearing, dated
July 8, 2004. Petitioner, utilizing Form 12153, Request for a
Collection Due Process Hearing, timely sought a hearing,
explaining his disagreement as follows:
Everything you claim I owe is false. My income has
been so small for so long--If I filed--I’m sure I would
be eligable [sic] for Govt. help. I have no idea how
you arrived at the false numbers you claim against me.
I have suffered much because of your tactics of
intimidation and look forward to getting the whole mess
straightened out.
The IRS Office of Appeals thereafter sent petitioner a
letter dated December 3, 2004, briefly outlining the Appeals
process, explaining the issues that could be raised, indicating
that challenges to the tax liability would be unavailable except
through other avenues such as the audit reconsideration process,
advising of materials that should be submitted for consideration
of any collection alternatives, and requesting that petitioner
call to discuss and schedule the requested hearing. Petitioner
called on December 17, 2004, continuing to voice disagreement
with the liabilities. He was again urged to file missing returns
and to pursue audit reconsideration, but he apparently indicated
that he “was not interested” in making an appointment with a
local auditor or examiner. Petitioner also stated that he wanted
a face-to-face collection hearing.
On January 12, 2005, the settlement officer with Appeals to
whom petitioner’s case had been assigned sent a letter scheduling
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an in-person hearing for February 16, 2005, and reprising the
points made in the previous letter. Petitioner neither appeared
for the hearing nor contacted the officer prior thereto. The
officer left a voicemail message for petitioner, who returned the
call and alleged that he did not receive the January 12, 2005,
letter. During that conversation petitioner also advised that he
was “living from hand to mouth and throws away receipts”. The
parties rescheduled a hearing for March 17, 2005.
On March 17, 2005, the settlement officer received a call
from petitioner, who said that he was still working on completing
financial information and unfiled returns. The settlement
officer explained that she was unable to afford additional time
and would be closing the case.
On March 24, 2005, respondent issued to petitioner the
aforementioned Notice of Determination Concerning Collection
Action(s) Under Section 6320 and/or 6330 sustaining the notice of
intent to levy. An attachment to the notice repeated the
prohibition on petitioner’s challenges to his underlying
liabilities, stated that petitioner did not raise any other
relevant issues or submit proposals regarding collection
alternatives, and noted that petitioner also had not filed income
tax returns for 1993 through 2003.
Petitioner filed an imperfect petition disputing the notice
on April 18, 2005, and an amended petition on June 8, 2005, both
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reflecting an address in Shoshone, Idaho. The amended petition
read: “MY GROSS INCOME WAS FAR LESS THAN YOU CLAIM I OWE IN
TAXES. IN NOT ONE OF THOSE YEARS DID I EARN MORE THAN SEVEN OR
EIGHT THOUSAND DOLLARS. I KNOW I DID NOT FILE. I BELIEVED MY
INCOME DID NOT REQUIRE IT.”
Respondent then filed a motion for summary judgment on
June 2, 2006. Petitioner was directed to file any response to
respondent’s motion on or before June 30, 2006. No such response
was received, and the motion was calendared for hearing on
August 29, 2006, at the session of the Court in Pocatello, Idaho.
There was no appearance by or on behalf of petitioner at call of
the case or at any of multiple recalls, despite the Court’s
having contacted petitioner by telephone during the session and
alerted him of times for the recalls.
At the final recall on August 30, 2006, the Court rendered a
bench opinion granting respondent’s motion for summary judgment.
Earlier in the day, counsel for respondent had expressed a desire
to move for imposition of a penalty under section 6673 in the
amount of $1,500. The Court had directed that respondent file a
written motion to that effect, which the Court would consider
prior to entering a decision in the case. Respondent filed the
referenced motion on September 29, 2006, and petitioner was
ordered to file any response on or before November 2, 2006. To
date, no response has been received by the Court.
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Discussion
Section 6673(a)(1) authorizes the Court to require the
taxpayer to pay a penalty not in excess of $25,000 when it
appears to the Court that, inter alia, 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. In Pierson v. Commissioner, 115 T.C. 576, 581
(2000), we warned that taxpayers abusing the protections afforded
by sections 6320 and 6330 through the bringing of dilatory or
frivolous lien or levy actions will face sanctions under section
6673. We have since repeatedly disposed of cases premised on
arguments akin to those raised herein summarily and with
imposition of the section 6673 penalty. See, e.g., Craig v.
Commissioner, 119 T.C. 252, 264-265 (2002) (and cases cited
thereat).
With respect to the instant matter, we have become convinced
that petitioner instituted this proceeding primarily for delay.
Throughout the administrative and judicial process, petitioner
has repeatedly failed to raise any substantive issues of merit,
to supply requested information, to comply with orders of this
Court, to submit responses when afforded an opportunity to do so,
and to appear at scheduled proceedings. The resultant waste of
time and effort on the part of respondent and the Court is
undeniably one of the evils to which section 6673 is directed.
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It therefore is appropriate to grant respondent’s motion and to
award a penalty of $1,500 to the United States in this case. To
reflect the foregoing,
An appropriate order and
decision will be entered.