T.C. Memo. 2010-161
UNITED STATES TAX COURT
REX D. FRANCIS, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 3170-09. Filed July 26, 2010.
Rex D. Francis, pro se.
Luanne S. DiMauro, for respondent.
MEMORANDUM OPINION
COHEN, Judge: Respondent determined a deficiency of $560 in
petitioner’s Federal income tax for 2006. Most of the deficiency
resulted from petitioner’s failure to report on his return
unemployment compensation reported to the Internal Revenue
Service (IRS) by the Connecticut Department of Labor. The issue
for decision is whether petitioner is liable for the deficiency
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despite his contention that he did not receive all of the
unemployment compensation to which he was entitled. Unless
otherwise indicated, all section references are to the Internal
Revenue Code in effect for the year in issue, and all Rule
references are to the Tax Court Rules of Practice and Procedure.
Background
None of the facts have been stipulated, and the evidence
consists entirely of petitioner’s testimony and the admissions in
his petition. Petitioner resided in Connecticut at the time he
filed his petition.
Petitioner was unemployed for part of 2006 and received
unemployment compensation that he failed to report on his 2006
Federal tax return. Some of the unemployment compensation to
which he was entitled was offset by amounts owed to the
Connecticut Department of Labor for prior debts, and the
Connecticut Department of Labor reported some of the compensation
to the IRS. According to respondent, the deficiency determined
included $2,871, representing 11 weeks of unemployment
compensation at $261 per week, reported by the State of
Connecticut to the IRS, and another undisputed income item.
Petitioner asserts that he was entitled to unemployment
compensation for 26 weeks at $261 per week, or a total of $6,786,
less offsets for a debt that he owed the State of Connecticut and
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for Federal and State income taxes. He argues that he did not
receive the correct net amount of unemployment benefits.
Discussion
Because petitioner refused to stipulate any exhibits and
various evidentiary objections were sustained, the record is too
sparse for meaningful findings of fact. (Respondent asserts that
the absence of admissible records is due to late breakdown of
settlement negotiations with petitioner’s counsel, who prepared
the petition and negotiated a settlement but withdrew at the
calendar call shortly before trial. Petitioner consented to
counsel’s withdrawal, and both parties agreed to go forward.)
The petition is internally inconsistent about unemployment
compensation that petitioner received. The petition alleges that
petitioner was unemployed for part of 2006 and received
unemployment compensation during the period in which he was
unemployed, acknowledges that unemployment compensation is
taxable, alleges that petitioner never actually received
unemployment compensation, and asks the Court to determine that
he did not receive any unemployment compensation in 2006. From
his testimony, it appears that petitioner is disputing amounts
not paid to him by the Connecticut Department of Labor, but his
testimony is unclear as to whether nonpayment is attributable to
offsets or suspension of his benefits.
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Although it is certainly not apparent from the record what
occurred, if petitioner’s unemployment compensation was withheld
or diverted to pay his debts he is still taxable on it. See,
e.g., Doose v. Commissioner, T.C. Memo. 2010-18; Chambers v.
Commissioner, T.C. Memo. 2000-218 (and cases cited therein),
affd. 17 Fed. Appx. 688 (9th Cir. 2001). Petitioner acknowledges
his understanding of this general rule. His argument is that he
was entitled to receive from the Connecticut Department of Labor
more than amounts properly withheld or diverted and more than the
amounts reported to the IRS by the State.
The only thing clear from the record is that petitioner’s
claims do not fall within the Court’s jurisdiction. He wants an
explanation of “where did the $6,786 go?”. He indicates that he
has tried unsuccessfully to get that information elsewhere. With
his refusal to stipulate relevant facts and documents, and the
inconsistencies in his petition and his testimony, we are unable
even to speculate about the answer to his question.
This Court has limited jurisdiction, which does not include
authority to resolve disputes between a taxpayer and Federal or
State authorities arising in other contexts and only remotely
relevant to the determination of a deficiency that is before us.
See, e.g., Kindred v. Commissioner, T.C. Memo. 2010-107;
Hackworth v. Commissioner, T.C. Memo. 2004-173. In this case,
our limited jurisdiction is to determine whether petitioner has
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shown any error in the notice of deficiency. He has the burden
of showing error, and he has not done so. See generally sec.
6201(d); Rule 142(a).
For the foregoing reasons,
Decision will be entered
for respondent.