           Case: 13-11581    Date Filed: 09/26/2013   Page: 1 of 5


                                                          [DO NOT PUBLISH]



             IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                            No. 13-11581
                        Non-Argument Calendar
                      ________________________

                            Agency No. 21102-10



DAVID LOVEN NELSON,

                                                             Petitioner-Appellant,

                                  versus

COMMISSIONER OF IRS,

                                                          Respondent-Appellee.

                      ________________________

                  Petition for Review of a Decision of the
                               U.S.Tax Court
                        ________________________

                            (September 26, 2013)

Before DUBINA, HULL and JORDAN, Circuit Judges.

PER CURIAM:
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      Appellant David Nelson appeals pro se the tax court’s decision upholding

the Commissioner of the Internal Revenue Service’s (“the Commissioner”)

deficiency determinations for tax years 2005 and 2008. According to the

Commissioner, Nelson had a tax deficiency in 2005 of $40,153, and was assessed

penalties of: (1) $9,034.43 under I.R.C. § 6651(a)(1); (2) $1,610.62 under

§ 6654(a); and (3) $9,837.49 under § 6651(a)(2). In 2008, Nelson’s tax deficiency

was $86,440, and he was assessed penalties of: (1) $12,112.20 under § 6651(a)(1);

and (2) $3,499.08 under § 6651(a)(2). The record shows that, during the years in

question, Nelson’s tax returns indicated that his wages were zero and that his

occupation was “American citizen.” However, Nelson was employed by

Northwest Airlines as a pilot and earned wages of $154,749.00 in 2005, and

$264,640.00 in 2008.

      Nelson argued before the tax court that he did not receive “wages” because

his activities did not constitute “employment,” as those terms are defined in the

Internal Revenue Code. He claimed that, during 2005 and 2008, he did not have

any taxable income because he did not perform a “service” (1) within the

Commonwealth of Puerto Rico, the Virgin Islands, Guam, or American Samoa,

(2) on or in connection with an American vessel or aircraft under a contract of

service entered into within the Commonwealth of Puerto Rico, the Virgin Islands,

Guam, or American Samoa, (3) for the United States or any instrumentality


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thereof. Thus, he asserted that he did not earn “wages” based on, inter alia, the

definitions of “employment” and “employee” in 26 U.S.C. §§ 3121 and 3401(c).

The tax court rejected Nelson’s arguments as frivolous, upheld the Commissioner’s

deficiency determinations, and sua sponte imposed a $2,000 sanction against

Nelson. On appeal, Nelson again argues that, in 2005 and 2008, he was not

engaged in any activities subject to federal employment taxation, as defined in

§ 3121(b). He concedes that he was paid for his work at Northwest Airlines and

essentially contends that the issue on appeal is whether his pay from 2005 and

2008 constitutes wages from “employment.”

      Section 1 of the Internal Revenue Code imposes a tax on the “taxable

income” of every individual. 26 U.S.C. § 1(a)-(d); see also 26 U.S.C. § 3101

(imposing FICA taxes on “every individual”). Taxable income is gross income

minus allowable deductions. 26 U.S.C. § 63(a). “[G]ross income means all income

from whatever source derived, including (but not limited to) . . . [c]ompensation

for services.” 26 U.S.C. § 61(a)(1). “Wages” include “all remuneration for

employment.” 26 U.S.C. § 3121(a). “Employment” is defined as “any service, of

whatever nature, performed by an employee for the person employing him,

irrespective of the citizenship or residence of either, within the United States.” Id.

§ 3121(b)(A)(i) (emphasis added).




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      Undisputedly, Nelson worked for Northwest Airlines as a pilot and received

“wages” for his work. Indeed, Nelson concedes that he was paid in exchange for

his services. Nelson’s wages, as compensation for services, constituted taxable

gross income. See 26 U.S.C. §§ 1(a)-(d), 61(a)(1), 63(a). Further, Nelson’s work

for Northwest constitutes “employment” within § 3121(b), because his service was

performed within the United States, irrespective of the citizenship or residence of

either party. See id. § 3121(b)(A)(i). Nelson’s reading of the statute wholly

ignores subsection (i), which defines “employment” as service between an

employer and employee within the United States. We have repeatedly rejected

arguments, such as Nelson’s, asserting that private sector employment income is

not subject to federal taxation. See United States v. Morse, 532 F.3d 1130,

1132-33 (11th Cir. 2008); Motes v. United States, 785 F.2d 928, 928 (11th Cir.

1986). Thus, we affirm the tax court’s determination.

      Moreover, we have imposed sanctions, even against pro se litigants, for

maintaining such frivolous arguments after being warned that the arguments are

frivolous. See Morse,532 F.3d at 1133; Motes, 785 F.2d at 728. Nelson has

previously been warned, both by the tax court and by this Court, that his arguments

are frivolous. See Nelson v. United States, 392 F. App’x 681, 682-83 (11th Cir.

2010) (unpublished). Further, Nelson’s reply brief was filed 24 days after the

Commissioner filed a motion for sanctions, affording Nelson a “reasonable


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opportunity to respond” to the motion in his brief. See Fed.R.App.P. 38. In

addition, the docket sheet shows that Nelson has made no separate response to the

Commissioner’s motion. Accordingly, we conclude that sanctions are appropriate,

and we will enter a separate order granting the Commissioner’s motion for

sanctions.

      AFFIRMED.




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