                       T.C. Memo. 1996-480



                     UNITED STATES TAX COURT



                PETER PAUL LAGASSE, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 5319-96.                    Filed October 24, 1996.



     Peter Paul Lagasse, pro se.

     Carmino J. Santaniello, for respondent.



                       MEMORANDUM OPINION



     PANUTHOS, Chief Special Trial Judge:    This case was heard

pursuant to section 7443A(b)(3)1 and Rules 180, 181, and 182.

Respondent determined a deficiency in petitioner's 1993 Federal

     1
        All section references are to the Internal Revenue Code
in effect for the tax year at issue. All Rule references are to
the Tax Court Rules of Practice and Procedure.
                                - 2 -

income tax in the amount of $7,228 and an addition to tax under

section 6651(a)(1) in the amount of $215.

     The issues for decision are:   (1) Whether petitioner

received taxable wages and unemployment compensation in the

amounts determined by respondent and (2) whether petitioner is

liable for the addition to tax under section 6651(a)(1) for

failure to file a return.

     The parties were unable to agree on a stipulation of facts

in this case.   Our findings of fact are based on the record

consisting of testimony of witnesses and documents submitted into

evidence.

     During the period December 1992 through mid-February 1993,

petitioner was unemployed.    During the period January 6 through

February 8, 1993, the State of Connecticut issued seven checks in

the amount of $198 each, for a total of $1,386, as unemployment

compensation to petitioner.   The Connecticut Department of Labor

records further reflect that each of the seven payments to

petitioner was designated as $288; however, $90 was offset from

each payment to pay an outstanding child support order.

Accordingly, the total payments for unemployment insurance in

1993 paid on behalf of petitioner were $2,016 (7 X $288) although

petitioner was sent checks totaling $1,386 (7 X $198).    A total

of $630 was sent to the Connecticut court to be applied against

the outstanding court order for child support.   Sometime during

the last week of January 1994, petitioner was sent a Form 1099
                               - 3 -

from the State of Connecticut reflecting unemployment

compensation paid in the amount of $2,016.

     Petitioner became employed by Mark Industries (Mark)

sometime in February 1993.   Mark's records reflect that

petitioner was paid wages in 1993 in the amount of $40,125.02.

Petitioner was issued a Form W-2 by Mark in January 1994

reflecting wages paid in the amount of $40,125.02.

     Petitioner did not file a Federal income tax return for

1993.   Respondent prepared a substitute return reflecting the

unemployment compensation and the wage income.   The notice of

deficiency determined that petitioner failed to file a 1993

Federal income tax return and determined a deficiency based on

the failure to report unemployment compensation and wage income.

The notice of deficiency also determined an addition to tax for

failure to file a return.

     Petitioner argues that he decided not to file a return

because of alleged illegal and corrupt activity by State and

Federal officials.   Petitioner further asserts that employees of

Mark were engaged in illegal activities including alteration of

records reflecting hours actually worked by petitioner and other

employees.

     Respondent's determination in the notice of deficiency is

presumed correct, and the taxpayer has the burden of proving

error therein.   Rule 142(a); Welch v. Helvering, 290 U.S. 111

(1933).
                                 - 4 -

     At trial, respondent presented a representative of the

Connecticut Department of Labor as well as an individual who was

controller of Mark in 1993.   The witnesses presented records of

their respective organizations that supported the amounts

determined in the notice of deficiency.    Petitioner did not

present any evidence to contradict the testimony and documents

submitted by respondent supporting the determination.    Petitioner

asserted that there was continuing corruption, and, therefore, he

would not comply with the requirements of filing a return and

reporting income.   Petitioner has failed to establish that

respondent's determination is erroneous.    Since there is no

question that the unemployment compensation and the wages

constitute taxable income, respondent's determination as to the

deficiency is sustained.

     Section 6651(a)(1) provides for an addition to tax for

failure to timely file a Federal income tax return.    Petitioner

was required to file a 1993 Federal income tax return on or

before April 15, 1994.   Secs. 6012(a), 6072(a).   Section

6651(a)(1) further provides that a taxpayer may avoid the

addition to tax if the failure to file was due to reasonable

cause and not willful neglect.     United States v. Boyle, 469 U.S.

241, 245 (1985).

     We conclude that petitioner's failure to file his 1993

return was due to willful neglect and not due to reasonable

cause.   Petitioner's unsupported assertions of illegal acts by
                                 - 5 -

his former employer and by State and Federal officials have no

foundation, nor do such assertions in any event provide a basis

for petitioner's failure to file a Federal income tax return and

report income thereon as required by law.    Respondent is

sustained on this issue.

     To reflect the foregoing,

                                         Decision will be entered

                                    for respondent.
