                          T.C. Memo. 2005-143



                        UNITED STATES TAX COURT



                CHRISTOPHER RICHARDSON, Petitioner v.
            COMMISSIONER OF INTERNAL REVENUE, Respondent



       Docket No. 11880-04.              Filed June 20, 2005.


       Christopher Richardson, pro se.

       Ric D. Hulshoff, for respondent.



               MEMORANDUM FINDINGS OF FACT AND OPINION


       COLVIN, Judge:   Respondent determined deficiencies in

petitioner’s Federal income tax as follows:

                                  Additions to Tax
Year    Deficiency   Sec. 6651(a)(1) Sec 6651(a)(2)    Sec. 6654(a)
1998      $5,518        $1,241.55        $1,379.50        $250.45
1999       5,088         1,144.80         1,170.24         244.35
2000       3,547           798.08           602.99         190.77
2001       4,410           992.25           485.10         174.52
                                - 2 -

     Respondent concedes that petitioner is not liable for the

addition to tax under section 6651(a)(2) for failure to pay for

the years in issue.1

     After respondent’s concession, the issues for decision are:

     1.   Whether petitioner had unreported income as determined

by respondent for 1998-2001.    We hold that he did.

     2.   Whether petitioner is liable for self-employment tax on

his earnings from Eniva Corp. of $221 for 2000 and $112 for 2001.

We hold that he is.

     3.   Whether petitioner’s filing status for 1998-2001 is

single.   We hold that it is.

     4.    Whether petitioner may claim more than one personal

exemption for 1998-2001.   We hold that he may not.

     5.   Whether petitioner is liable for the additions to tax

under section 6651(a)(1) for failure to file and section 6654 for

failure to pay estimated tax for 1998-2001.    We hold that he is.

     Section references are to the Internal Revenue Code in

effect for the taxable years in issue.    Rule references are to

the Tax Court Rules of Practice and Procedure.




     1
        Respondent does not contend that petitioner is liable for
the addition to tax for failure to file under sec. 6651(a)(1) in
an amount larger than respondent determined for any of the years
in issue.
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                         FINDINGS OF FACT

     Petitioner lived in Black Canyon City, Arizona, when he

filed the petition in this case.

     Petitioner was a beneficiary in 1998-2001 of the Frank J.

Nagy Trust, administered by KeyBank National Association

(KeyBank) as trustee.   Petitioner earned interest in the amounts

of $18,171 for 1998, $19,065 for 1999, $12,879 for 2000, and

$17,155 for 2001, and dividends in the amounts of $9,440 for

1998, $7,140 for 1999, $3,807 for 2000, and $5,866 for 2001 from

the trust.   He received Social Security benefits of $10,821 for

1998, $10,962 for 1999, $11,226 for 2000, and $11,640 for 2001.

He received nonemployee compensation from Eniva Corp. in the

amounts of $1,565 for 2000 and $794 for 2001.   No Federal income

tax was withheld for petitioner in the years in issue by any of

these payors.

     Petitioner did not file Federal income tax returns for 1998-

2001 or make estimated tax payments for those years.

     Respondent issued notices of deficiency to petitioner for

the years in issue.   Respondent determined that petitioner

received taxable income based on documents provided by

third-party payors.   Respondent determined that petitioner’s

filing status was single and allowed petitioner one exemption.

     Before trial, petitioner asserted that he had a Fifth

Amendment right not to testify because to do so would have
                                 - 4 -

required him to waive his Fifth Amendment privilege against

self-incrimination.   Petitioner did not identify or exchange any

documents, identify witnesses, or file a pretrial memorandum as

required by the Standing Pretrial Order.    Respondent complied

with these requirements.

                              OPINION

A.   Burdens of Production and Proof

     1.   Burden of Production

          a.   Section 6201(d)

     If a taxpayer asserts a reasonable dispute with respect to

any item of income reported on a third-party information return

and the taxpayer has fully cooperated with the Secretary, the

Secretary has the burden of producing reasonable and probative

information concerning that deficiency in addition to such

information return.   Sec. 6201(d).

     Petitioner did not introduce any evidence to refute

respondent’s evidence or show that respondent’s determination of

petitioner’s income is in error.    We conclude that respondent

does not have the burden of production under section 6201(d)

because petitioner did not assert a reasonable dispute with

respect to any item of income reported on an information return

and petitioner has not fully cooperated with respondent.    Even if

respondent had the burden of proceeding under section 6201(d),

respondent met that burden by producing information returns with
                                - 5 -

certified transcripts from respondent’s files and from Social

Security Administration files and declarations and supporting

records from Ann Patterson (Patterson), vice president of KeyBank

and Curtis E. Cichanowski (Cichanowski), director of finance for

Eniva Corp.    The declarations were made under penalties of

perjury pursuant to and in the form required by 28 U.S.C. section

1746 (2000).

     The declarations are admissible under rules 803(6) and

902(11) of the Federal Rules of Evidence.    Rule 803(6) of the

Federal Rules of Evidence provides an exception to the hearsay

rule for records that are kept in the course of a regularly

conducted activity and made at or near the time of the event by a

person with knowledge.    Rule 902(11) of the Federal Rules of

Evidence states the requirements for self-authentication of a

business record.    To qualify under Rule 902(11), a domestic

record of a regularly conducted business activity must be

accompanied by a declaration certifying that the record (1) was

made at or near the time of the occurrence of the matters set

forth by, or from information transmitted by, a person with

knowledge of those matters; (2) was kept in the course of the

regularly conducted activity; and (3) was made by the regularly

conducted activity as a regular practice.    All of the underlying

documents were kept in the regular course of business, and the
                               - 6 -

declarations of the validity of these documents were made by

people familiar with them.

     We conclude that section 6201(d) does not apply in this

case.

          b.   Determination in Unreported Income Cases

     The U.S. Court of Appeals for the Ninth Circuit (to which an

appeal of this case would lie) has held that in order for the

presumption of correctness to attach to the notice of deficiency

in unreported income cases, the Commissioner must establish “some

evidentiary foundation linking the taxpayer” to the

income-producing activity, Weimerskirch v. Commissioner, 596 F.2d

358, 361-362 (9th Cir. 1979), revg. 67 T.C. 672 (1977), or some

substantive evidence “demonstrating that the taxpayer received

unreported income”, Edwards v. Commissioner, 680 F.2d 1268, 1270

(9th Cir. 1982); see also Rapp v. Commissioner, 774 F.2d 932, 935

(9th Cir. 1985).   Once there is evidence of actual receipt of

funds by the taxpayer, the taxpayer has the burden of proving

that all or part of those funds is not taxable.    Tokarski v.

Commissioner, 87 T.C. 74, 76-77 (1986).

     There is ample evidence linking petitioner to

income-producing activities.   He received interest and dividends

from the trust through KeyBank, Social Security benefits from the

Social Security Administration, and nonemployee compensation from

Eniva Corp. during the years in issue.    At trial, respondent
                                  - 7 -

submitted Forms 1099-MISC, Miscellaneous Income, transcripts from

the Social Security Administration, employer records, and

declarations under penalties of perjury of Patterson for KeyBank

and Cichanowski for Eniva Corp. as to the validity of these

underlying documents.   The Forms 1099-MISC, certified

transcripts, declarations, and supporting documents show that

petitioner received income during the years in issue.     Petitioner

bears the burden of proving respondent’s determinations are in

error.    See Edwards v. Commissioner, supra; Weimerskirch v.

Commissioner, supra.

     2.    Burden of Proof

     Petitioner contends that respondent generally bears the

burden of proof.   We disagree.    The burden of proof for a factual

issue relating to liability for tax shifts to the Commissioner

under certain circumstances.   Sec. 7491(a).    Under section

7491(a), the burden of proof with respect to a factual issue

relevant to a taxpayer’s liability for tax shifts from the

taxpayer to the Commissioner if, inter alia, the taxpayer has:

(a) Complied with substantiation requirements under the Internal

Revenue Code, sec. 7491(a)(2)(A); (b) maintained all records

required by the Internal Revenue Code, sec. 7491(a)(2)(B); and

(c) cooperated with reasonable requests by the Secretary for

information, documents, and meetings, id.      A taxpayer bears the

burden of proving that he or she has met the requirements of
                                - 8 -

section 7491(a).   See H. Conf. Rept. 105-599, at 239 (1998),

1998-3 C.B. 747, 993; S. Rept. 105-174, at 45 (1998), 1998-3 C.B.

537, 581.   Petitioner does not contend that he meets the

requirements of section 7491(a), and the record shows that he did

not meet those requirements because he did not cooperate with

respondent.   Thus, petitioner bears the burden of proof.    See

Rule 142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933).

     3.     Whether Petitioner’s Fifth Amendment Claims Affect the
            Burden of Proof

     Before trial, petitioner asserted Fifth Amendment rights

against self-incrimination.   However, even if petitioner’s claim

were bona fide (which we need not decide), it would have no

effect on petitioner’s burden of proof.    See United States v.

Rylander, 460 U.S. 752, 758 (1983); Petzoldt v. Commissioner, 92

T.C. 661, 684-685 (1989); Traficant v. Commissioner, 89 T.C. 501,

504 (1987), affd. 884 F.2d 258 (6th Cir. 1989).

B.   Petitioner’s Income in 1998-2001

     Petitioner has not shown that respondent’s determination of

his income for 1998-2001 is incorrect.    We conclude that

petitioner received taxable income in 1998-2001 as determined by

respondent.

C.   Whether Petitioner Is Liable for Self-Employment Tax

     Respondent determined that petitioner is liable for self-

employment tax on his earnings from Eniva Corp. for 2000 and

2001.
                                - 9 -

       Section 1401 imposes a tax on an individual’s

self-employment income.    The self-employment tax is imposed on

net earnings of $400 or more derived by an individual from a

trade or business carried on by him.    Sec. 1402(a) and (b).

       Petitioner did not prove that respondent’s determination of

his liability for self-employment tax was incorrect.    We conclude

that the income attributable to petitioner from Eniva Corp. in

2000 and 2001 is earnings from self-employment under section

1402, subject to the tax imposed by section 1401.

D.     Filing Status and Exemptions

       Petitioner did not file returns for the years in issue.

Respondent determined that petitioner’s filing status was single

and allowed petitioner one exemption.    Petitioner offered no

evidence on these points.    We deem petitioner to have conceded

these issues.    See Funk v. Commissioner, 123 T.C. 213, 217-218

(2004); Swain v. Commissioner, 118 T.C. 358, 363-365 (2002).

E.     Whether Petitioner Is Liable for Additions to Tax

       Section 7491(c) places on the Commissioner the burden of

producing evidence that it is appropriate to impose additions to

tax.    To meet the burden of production under section 7491(c), the

Commissioner must produce evidence showing that it is appropriate

to impose the particular addition to tax, but need not produce

evidence relating to defenses such as reasonable cause or
                               - 10 -

substantial authority.    Higbee v. Commissioner, 116 T.C. 438, 446

(2001); H. Conf. Rept. 105-599, supra at 241, 1998-3 C.B. at 995.

     Petitioner did not file returns for 1998-2001, and he did

not make estimated tax payments with respect to his tax liability

for those years.    There is no evidence that petitioner paid any

tax for the years in issue.    Thus, respondent has met the burden

of production, and petitioner is liable for additions to tax for

failure to file under section 6651(a)(1) of $1,241.55 for 1998,

$1,144.80 for 1999, $798.08 for 2000, and $992.25 for 2001, and

additions to tax under section 6654 for failure to pay estimated

tax of $250.45 for 1998, $244.35 for 1999, $190.77 for 2000, and

$174.52 for 2001.

     To reflect the foregoing,


                                               Decision will be

                                          entered for respondent.
