                         T.C. Memo. 2002-156



                       UNITED STATES TAX COURT



                MICHAEL SAWUKAYTIS, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 11672-00.                Filed June 19, 2002.


     Michael Sawukaytis, pro se.

     Kimberly J. Webb, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     VASQUEZ, Judge:    Respondent determined a deficiency of

$13,976 and an addition to tax of $726 pursuant to section

6651(a)(1)1 in petitioner’s 1996 Federal income tax.




     1
        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.
                               - 2 -

     The issues for decision are:     (1) Whether petitioner

received gross income subject to tax, as determined by

respondent; (2) whether petitioner is liable for an addition to

tax for failing to file a Federal income tax return for 1996; and

(3) whether petitioner engaged in behavior warranting the

imposition of a penalty pursuant to section 6673(a).

                         FINDINGS OF FACT

     Some of the facts have been stipulated and are so found.

The stipulation of facts and the attached exhibits are

incorporated herein by this reference.     At the time he filed his

petition, petitioner resided in Ann Arbor, Michigan.

     During 1996, petitioner was employed at the Ford Motor Co.

(Ford).   In 1996, Ford paid petitioner $69,699 in wage income.

In 1996, petitioner received a $162 State tax refund for 1995 and

$29 of interest from a credit union.

     Petitioner did not file a Federal income tax return for

1996.   Pursuant to section 6020(b), respondent prepared a

substitute for return for petitioner.

                              OPINION

     Section 61 defines gross income as all income from whatever

source derived.   Gross income includes compensation for services

and interest.   Sec. 61(a)(1), (4).

     Petitioner does not challenge the facts on which

respondent’s determinations are based or respondent’s calculation
                                 - 3 -

of tax.2    Petitioner stipulated that during 1996 he received

compensation from Ford.     At trial, petitioner testified that

during 1996 he received interest income and a State tax refund.

     In motions, at trial, and on brief, petitioner advanced

shopworn arguments characteristic of tax-protester rhetoric that

has been universally rejected by this and other courts.     Wilcox

v. Commissioner, 848 F.2d 1007 (9th Cir. 1988), affg. T.C. Memo.

1987-225; Carter v. Commissioner, 784 F.2d 1006, 1009 (9th Cir.

1986).     Petitioner argues that the income tax is an excise tax

and that he did not engage in excise taxable activities in 1996.3

We shall not painstakingly address petitioner’s assertions “with

somber reasoning and copious citation of precedent; to do so

might suggest that these arguments have some colorable merit.”

Crain v. Commissioner, 737 F.2d 1417, 1417 (5th Cir. 1984).

Accordingly, we sustain respondent’s deficiency determination.

     Respondent also determined that petitioner is liable for an



     2
        Cf. sec. 7491(a), effective for court proceedings arising
in connection with examinations commencing after July 22, 1998.
Petitioner does not contend that his examination began after July
22, 1998, or that sec. 7491(a) is applicable to his case. In any
event, we do not find that resolution of this case depends on
which party has the burden of proof. We resolve the issue on the
basis of a preponderance of evidence in the record. Regardless
of which party has the burden of proof, we still sustain
respondent’s deficiency determination for the reasons stated
below.
     3
        Petitioner testified: “The income tax is an excise tax.
Congress, who sets the laws, even says so in the Congressional
Record. The income tax is therefore not a tax on income.”
                                - 4 -

addition to tax pursuant to section 6651(a)(1).   Section

6651(a)(1) imposes an addition to tax for failure to file a

return on the date prescribed (determined with regard to any

extension of time for filing), unless the taxpayer can establish

that such failure is due to reasonable cause and not due to

willful neglect.    Rule 142(a); United States v. Boyle, 469 U.S.

241, 245 (1985).4

     Petitioner stipulated that he did not file a return for

1996, and he offered no evidence showing that his failure to file

was due to reasonable cause and not due to willful neglect.

Accordingly, we hold that petitioner is liable for the addition

to tax under section 6651(a)(1).

     Section 6673(a)(1) authorizes this Court to require a

taxpayer to pay to the United States a penalty not to exceed

$25,000 if the taxpayer took frivolous positions in the

proceedings or instituted the proceedings primarily for delay.      A

position maintained by the taxpayer is “frivolous” where it is

“contrary to established law and unsupported by a reasoned,

colorable argument for change in the law.”    Coleman v.

Commissioner, 791 F.2d 68, 71 (7th Cir. 1986).

     On May 10, 2001, petitioner filed a request for admissions.



     4
        Cf. sec. 7491(c), effective for court proceedings arising
in connection with examinations commencing after July 22, 1998.
Petitioner does not contend that his examination began after July
22, 1998, or that sec. 7491(c) is applicable to his case.
                                 - 5 -

Most of the requested admissions regarded respondent’s opinion

about the Sixteenth Amendment and whether the income tax was a

direct or indirect tax.     On May 18, 2001, respondent filed a

response to petitioner’s request for admissions.

     On May 29, 2001, petitioner filed a motion for review of

response to petitioner’s request for admissions.      Petitioner

alleged that respondent’s responses to petitioner’s paragraphs

regarding respondent’s opinion about the Sixteenth Amendment and

whether the income tax was a direct or indirect tax were

insufficient.5

     On July 7, 2001, the Court denied petitioner’s motion for

review of response to petitioner’s request for admissions.      The

Court found that respondent’s answers were sufficient.

     On August 3, 2001, petitioner filed a motion to reconsider

the Court’s order of July 7, 2001.       Petitioner stated that he was

seeking respondent’s position on a point of law regarding the

nature of the income tax.    On August 6, 2001, the Court denied

this motion.

     On September 4, 2001, petitioner filed a motion for leave to

file interlocutory appeal seeking review of the Court’s denial of

petitioner’s motion to reconsider Court’s order of July 7, 2001.

Petitioner stated that he was seeking respondent’s “policy and


     5
        Respondent objected to these paragraphs on the ground
that the request for admissions sought admissions based on
statements of law rather than statements of fact.
                                   - 6 -

procedure” on a point of law regarding the nature of the income

tax.    On September 27, 2001, the Court denied this motion.

       On September 17, 2001, petitioner filed a motion to quash

subpoena duces tecum.    The subpoena required petitioner to appear

30 minutes before the trial and to bring certain documents with

him.    On October 5, 2001, the Court denied this motion.

       On October 23, 2001, petitioner filed a motion for

reconsideration of the Court’s order of October 5, 2001.           On

October 24, 2001, the Court denied this motion.

       On December 3, 2001, over a month after the trial of this

case, petitioner filed a motion to reconsider the denial of

motion to quash subpoena duces tecum.         On December 11, 2001, the

Court denied this motion.

       At trial, the Court warned petitioner that his arguments

were frivolous and of the provisions of section 6673.         Petitioner

filed several frivolous documents with the Court.         Petitioner’s

position, based on stale and meritless contentions, is manifestly

frivolous and groundless, and he has wasted the time and

resources of this Court.    Accordingly, we shall impose a penalty

of $12,500 pursuant to section 6673.

       To reflect the foregoing,

                                                Decision will be

                                           entered for respondent.
