                         T.C. Memo. 2003-27



                       UNITED STATES TAX COURT



                   TRACEE CREEN, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 4344-01.                Filed January 30, 2003.


     Tracee Creen, pro se.

     Jeanne Gramling, for respondent.



                         MEMORANDUM OPINION


     CHIECHI, Judge:    This case is before us on respondent’s

motion to dismiss for lack of prosecution.    At the request of

respondent, on October 7, 2002, the Court held a trial solely for

the purpose of permitting respondent to present evidence to
                               - 2 -

satisfy the burden of proof under Rule 142(a)1 that respondent

has with respect to the increased deficiency in Federal income

tax (tax) alleged in respondent’s amendment to answer.

                            Background

     The record establishes and/or the parties do not dispute the

following:

     At the time petitioner filed the petition, petitioner’s

mailing address was in Tryon, North Carolina.

     During 1998, Spartanburg Regional Medical Center

(Spartanburg Medical Center) employed petitioner and paid her

$16,679.62 in wages.   During that year, Spartanburg Medical

Center deposited all of petitioner’s wages directly into her bank

account, except for $99.16 that it paid petitioner by check.

Spartanburg Medical Center reported the wages that it paid

petitioner during 1998 in Form W-2, Wage and Tax Statement (Form

W-2).2

     In the notice of deficiency (notice) issued to petitioner

for her taxable year 1998, respondent determined a deficiency in

petitioner’s tax of $911 attributable to a State tax refund and

certain nonemployee compensation that she received during that



     1
      All Rule references are to the Tax Court Rules of Practice
and Procedure. All section references are to the Internal
Revenue Code in effect at all relevant times.
     2
      As reflected in Form W-2, during 1998 Spartanburg Medical
Center withheld $1,459.54 in tax from petitioner’s wages.
                                - 3 -

year, but respondent did not determine a deficiency of $1,459

attributable to petitioner’s wage income that she received during

1998 from Spartanburg Medical Center.

     On August 19, 2002, respondent filed a motion for leave to

file an amendment to answer (respondent’s motion to amend an-

swer), in which respondent alleged an increased deficiency for

petitioner’s taxable year 1998 in the amount of $1,459 attribut-

able to petitioner’s wage income of $16,679.62 from Spartanburg

Medical Center.3

     On August 20, 2002, the Court ordered petitioner to file a

written response to respondent’s motion to amend answer.    On

September 4, 2002, instead of filing such a response, petitioner

submitted to the Court a document that the Court had filed as

petitioner’s motion to dismiss (petitioner’s September 4, 2002

motion to dismiss).

     In an Order dated September 5, 2002 (September 5, 2002



     3
        In respondent’s amendment to answer, respondent alleges in
part:

          (c) Inasmuch as the Service Center initially
     assessed the income from Spartanburg Regional Medical
     Center under the math error provisions of I.R.C.
     § 6213(b)(1), respondent did not include the * * *
     $16,679.62 from Spartanburg Regional Medical Center in
     his determination of unreported income set forth in the
     notice of deficiency for 1998 * * *

          (d) Subsequently, respondent * * * abated the math
     error assessment of the tax resulting from the income
     received from Spartanburg Regional Medical Center.
                                  - 4 -

Order), the Court granted respondent’s motion to amend answer and

denied petitioner’s September 4, 2002 motion to dismiss.        In that

Order, the Court indicated that petitioner’s September 4, 2002

motion to dismiss contained various statements, arguments, and

contentions that the Court found to be frivolous and/or ground-

less.4    In the Court’s September 5, 2002 Order, the Court re-


     4
      The following excerpts from petitioner’s September 4, 2002
motion to dismiss illustrate the various frivolous and/or ground-
less statements, arguments, and contentions contained in that
motion:

     1.       Very few citizens and residents of the United
              States, domestic corporations, trusts, partner-
              ships, etc., are liable for federal income taxes
              imposed by Subtitle A of the Internal Revenue Code
              that require keeping books and records and filing
              returns. Taxing and liability statutes do not
              apply to income sources, articles, activities and
              transactions of the American people and domestic
              juristic entities other than those who receive
              income from foreign sources, insular possessions
              of the United States, and maritime activity regu-
              lated by treaty. * * *

          *        *       *        *       *       *       *

     4.       Court documents and published district and circuit
              court decisions verify that the Internal Revenue
              Service is agent of the [federal] United States of
              America, not Government of the United States.
              * * * Court records therefore verify that Internal
              Revenue Service personnel are agents of a foreign
              government and Internal Revenue Service claims are
              made on behalf of a government foreign to the
              United States.

          *        *       *        *       *       *       *

          U.S. Tax Court subject matter jurisdiction is
     limited to determining the correct amount of a defi-
                                                   (continued...)
                                 - 5 -

minded petitioner about section 6673(a)(1)5 and indicated that it

would be inclined to impose a penalty on her under that section

not in excess of $25,000 in the event that she continued to make



     4
      (...continued)
     ciency and whether or not proper procedure was used for
     determining the deficiency. Where venue, subject
     matter jurisdiction and other collateral issues are
     concerned, and where IRS personnel malfeasance and
     misfeasance are concerned, district courts of the
     United States, and under some circumstance, common law
     courts in States of the Union, have subject matter
     jurisdiction. Further, the U.S. Tax Court, which now
     appears to be classified as an Article I court of the
     United States, does not proceed in the course of the
     common law, as required by the Fifth, Sixth and Seventh
     Amendment to the Constitution of the United States, so
     it is incompetent to provide remedies prescribed by the
     Constitution and laws of the United States. Therefore,
     I move for the U.S. Tax Court to dismiss this matter
     for lack of subject matter jurisdiction. [Reproduced
     literally.]
     5
      Sec. 6673(a)(1) provides in pertinent part:

     SEC. 6673.    SANCTIONS AND COSTS AWARDED BY COURTS.

          (a) Tax Court Proceedings.--

               (1) Procedures instituted primarily for de-
          lay, etc.--Whenever it appears to the Tax Court
          that--

                       (A) proceedings before it have been
                  instituted or maintained by the taxpayer
                  primarily for delay, [or]

                       (B) the taxpayer’s position in such
                  proceeding is frivolous or groundless, * * *

     the Tax Court, in its decision, may require the tax-
     payer to pay to the United States a penalty not in
     excess of $25,000.
                                 - 6 -

frivolous and/or groundless statements, contentions, and/or

arguments.

     On at least five separate occasions during July, August, and

September 2002, respondent unsuccessfully attempted to contact

petitioner through written correspondence for the purpose of

preparing this case for trial.    At least during the pendency of

the instant proceeding, petitioner has failed to cooperate with

respondent.

     On October 7, 2002, this case was called from the Court’s

trial calendar (calendar call) at the Court’s trial session in

Columbia, South Carolina.   Neither petitioner nor any authorized

representative of petitioner appeared.   Counsel for respondent

appeared and filed with the Court a motion to dismiss this case

for lack of prosecution on those issues in the case on which

respondent claims petitioner has the burden of proof.   The Court

indicated that the Court would recall this case for hearing on

that motion on October 9, 2002.    The Court instructed respondent

to attempt to send to petitioner via overnight delivery a copy of

respondent’s motion to dismiss for lack of prosecution together

with a cover letter advising her that the Court had set that

motion for hearing on October 9, 2002, and that the Court would

grant respondent’s motion to dismiss for lack of prosecution if

petitioner did not appear at that hearing.   At the calendar call,

counsel for respondent requested the Court to hold a trial on the
                               - 7 -

increased deficiency alleged in respondent’s amendment to answer

on which respondent has the burden of proof.

     On October 7, 2002, this case was recalled for trial on the

increased deficiency alleged in respondent’s amendment to answer.

Neither petitioner nor any authorized representative of peti-

tioner appeared.   Respondent appeared, and the Court held a trial

on the increased deficiency alleged by respondent.6

     On October 9, 2002, this case was recalled for a hearing on

respondent’s motion to dismiss for lack of prosecution.   Neither

petitioner nor any authorized representative of petitioner

appeared.   Counsel for respondent appeared and informed the Court

that on October 7, 2002, she had sent to petitioner by U.S.

Postal Service Express Mail and by facsimile a copy of respon-

dent’s motion together with a transmittal letter informing

petitioner of the hearing on respondent’s motion to dismiss for

lack of prosecution that the Court scheduled on October 9, 2002,

and of the consequences of her failure to appear at that hearing.

     On October 10, 2002, the Court received a document from

petitioner that the Court had filed as petitioner’s motion to

dismiss (petitioner’s October 10, 2002 motion to dismiss).

     In an Order dated October 16, 2002 (October 16, 2002 Order),

the Court denied petitioner’s October 10, 2002 motion to dismiss.



     6
      The Court ordered the parties to file posttrial briefs.
Petitioner failed to file a brief in this case.
                               - 8 -

In that Order, the Court indicated that petitioner’s October 10,

2002 motion to dismiss, like petitioner’s September 4, 2002

motion to dismiss, contained various statements, arguments,

contentions, and/or questions that the Court found to be frivo-

lous and/or groundless.7   In the Court’s October 16, 2002 Order,


     7
      Petitioner’s October 10, 2002 motion to dismiss restated
certain of the frivolous and/or groundless statements, arguments,
and contentions contained in petitioner’s September 4, 2002
motion to dismiss and set forth additional frivolous and/or
groundless statements, arguments, contentions, and/or questions.
By way of illustration, petitioner’s October 10, 2002 motion to
dismiss stated:

         In order to resolve existing and/or avert future
     controversy, the following must be objectively proven
     in record for calendar years specified above. Please
     address all questions and, where necessary, provide
     documentary and whatever other evidence that supports
     the findings:

     1.   What class or classes of tax are at issue, i.e.,
          what taxing and liability statues, along with
          implementing regulations, make me a person liable
          for keeping books and records and filing returns?
          (Sixth Amendment right to know the nature of the
          action)

     2.   What internal revenue district, established in compli-
          ance with requirements of 26 U.S.C. § 7621 and Execu-
          tive Order #10289, is the situs of the taxable arti-
          cles, activities and/or transactions from which the
          alleged taxable income was derived?

     3.   What delegated authority, whether statutory or other-
          wise, does IRS have for administering the class or
          classes of tax at issue? (See 5 U.S.C. § 558(b))

     4.   What “officer, employee, or agency of the Treasury
          Department [or] other officer of the United States” is
          the delegate of the Secretary for purposes of collect-
          ing income and employment taxes imposed by Chapters 1,
                                                   (continued...)
                               - 9 -

the Court reminded petitioner about the Court’s September 5, 2002

Order, in which the Court had indicated that it would be inclined

to impose a penalty not in excess of $25,000 on her pursuant to

section 6673(a)(1) if she continued to make frivolous and/or

groundless statements, contentions, and/or arguments.

                            Discussion

     We turn first to respondent’s motion to dismiss for lack of

prosecution.   It is respondent’s position that petitioner has the

burden of proof on the determinations in the notice which that

motion addresses because petitioner failed to cooperate with

respondent in the preparation of this case for trial.   Petitioner

does not dispute respondent’s position.   On the record before us,

we agree with respondent that petitioner bears the burden of

proof with respect to the determinations in the notice.   See sec.

7491(a)(1) and (2)(B).

     Neither petitioner nor any authorized representative of

petitioner appeared at the hearing on October 9, 2002, on respon-




     7
      (...continued)
          2 and 21 of the Internal Revenue Code in States of the
          Union? (26 U.S.C. § 7701(a)(1)(A))

     5.   What order, agreement, contract or other such legal
          document or device does the Internal Revenue Service
          have that authorizes examination and collection activ-
          ity on behalf of the “delegate” of the Secretary, as
          defined at 26 U.S.C. § 7701(a)(12)(A), in States of the
          Union? See §§ 1001(b)(2) of P.L. 105-206.
                              - 10 -

dent’s motion to dismiss for lack of prosecution.8   The record in

this case does not contain any valid reason why the Court should

not dismiss this case for lack of prosecution.

     We turn now to the trial in this case that the Court held at

respondent’s request on the increased deficiency for 1998 alleged

in respondent’s amendment to answer on which respondent has the

burden of proof.   Neither petitioner nor any authorized represen-

tative of petitioner appeared at that trial.   Respondent appeared

and established at the trial that during 1998 petitioner received

$16,679.62 in wages from Spartanburg Medical Center.   On the

record before us, we find that respondent has carried respon-

dent’s burden of proof with respect to the increased deficiency

of $1,459 with respect to those wages alleged in respondent’s

amendment to answer.

     Based on our examination of the entire record before us, we

shall grant respondent’s motion to dismiss this case for failure

by petitioner to prosecute, and we shall enter a decision sus-

taining the deficiency determination of $911 in the notice,

increased by $1,459 as alleged in respondent’s answer to amend-

ment.9


     8
      Nor did petitioner or any authorized representative of
petitioner appear on Oct. 7, 2002, at the calendar call.
     9
      In an appendix to respondent’s brief, respondent states
that “A federal withholding credit in the amount of $1,460 will
be applied against the deficiency” for petitioner’s taxable year
                                                   (continued...)
                               - 11 -

     Although respondent does not ask the Court to impose a

penalty on petitioner under section 6673(a)(1), the Court will

sua sponte determine whether to impose such a penalty.    Neither

petitioner nor any authorized representative of petitioner

appeared on October 7, 2002, at the calendar call or at the trial

in this case.    Nor did petitioner or any authorized representa-

tive of petitioner appear at the hearing on October 9, 2002, on

respondent’s motion to dismiss for lack of prosecution.   More-

over, in the Court’s September 5, 2002 Order, the Court indicated

that petitioner’s September 4, 2002 motion to dismiss contained

various statements, arguments, and contentions that the Court

found to be frivolous and/or groundless.   In that Order, the

Court also indicated it would be inclined to impose a penalty on

petitioner under that section not in excess of $25,000 in the

event she continued to make frivolous and/or groundless state-

ments, contentions, and/or arguments.   Petitioner nonetheless

persisted in petitioner’s October 10, 2002 motion to dismiss in

advancing various statements, arguments, contentions, and ques-

tions that the Court found to be frivolous and/or groundless.

     On the record before us, we find that petitioner instituted

and maintained this case primarily for delay.   We further find on

that record that petitioner’s position in this case is frivolous



     9
        (...continued)
1998.
                              - 12 -

and/or groundless.   On the record before us, we shall impose a

penalty on petitioner pursuant to section 6673(a)(1) in the

amount of $250.

     To reflect the foregoing,



                                      An appropriate order of dis-

                                 missal for lack of prosecution and

                                 decision will be entered.
