                  T.C. Summary Opinion 2005-148



                     UNITED STATES TAX COURT



                 GILLIS TRIPLETT, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 19733-03S.              Filed October 12, 2005.


     Gillis Triplett, pro se.

     John W. Sheffield III, for respondent.




     COUVILLION, Special Trial Judge:    This case was heard

pursuant to section 7463 in effect when the petition was filed.1

The decision to be entered is not reviewable by any other court,

and this opinion should not be cited as authority.


     1
      Unless otherwise indicated, subsequent section references
are to the Internal Revenue Code in effect for the years at
issue, and all Rule references are to the Tax Court Rules of
Practice and Procedure.
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Respondent determined the following deficiencies, section

6651(a)(1) addition to tax, and section 6662(a) penalties for the

1998, 1999, 2000, and 2001 taxable years:


Year             Deficiency        Sec. 6651(a)(1)        Sec. 6662(a)

1998               $3,716                 $100              $743.20
1999                2,483                  -0-               496.60
2000                2,467                  -0-               493.40
2001                3,440                  -0-               688.00


       The issues for decision are whether petitioner is entitled

to charitable contribution deductions claimed for 1998, 1999,

2000, and 2001, and whether he is liable for the section

6651(a)(1) addition to tax and the section 6662(a) penalties.

       Some of the facts were stipulated.        Those facts, with the

exhibits annexed thereto, are so found and made part hereof.

Petitioner’s legal residence at the time the petition was filed

was Mableton, Georgia.

       During the years at issue, petitioner was employed on and

off as a sales trainer for Parmalat-Atlanta Dairies.          He also

received unemployment compensation in the amount of $6,864 in

1999 and $1,582 in 2001.      At trial, petitioner did not state the

current status of his employment.     When employed, petitioner

worked 40 hours a week.

       On May 16, 1994, petitioner incorporated Embassy Christian

Center, Inc. (the Center).     Petitioner was listed as the

secretary, CEO, CFO, and Agent of the Center.          The Center’s
                                 - 3 -

business address at the time of incorporation was the same as

petitioner’s personal home address.       Petitioner opened a

corporate bank account on behalf of the Center with Nationsbank

and listed himself as the sole authorized signatory.2         Petitioner

also installed an additional phone line in his home in the name

of “Gillis Triplett d/b/a/ Embassy Christian Center, Inc.”

     Petitioner filed his 1998, 1999, and 2000 Federal income tax

returns untimely on April 1, 2002.       He filed his 2001 Federal

income tax return timely.   During the years in question,

petitioner reported total income and claimed deductions for

charitable contributions in the following amounts:3

     Year         Total Income              Charitable Contributions

     1998           $41,635                         $18,831
     1999            33,097                          16,549
     2000            32,968                          16,484
     2001            40,593                          20,297


     Respondent disallowed all the claimed charitable

contributions deductions due to lack of substantiation.


     2
      Petitioner testified that the Center had a treasurer for
some of the time during the years at issue who was authorized to
issue checks from the account, but he offered no evidence in
support of this testimony. Regardless, petitioner was authorized
to write checks on behalf of the Center at all times during the
years at issue.
     3
      The amounts listed on the notice of deficiency sent to
petitioner differ slightly from those referred to during trial
and in this opinion. The true amounts, listed herein, are taken
from petitioner’s 1998, 1999, 2000, and 2001 Federal income tax
returns. The difference in the amounts, however, is so nominal
that a Rule 155 computation is unnecessary.
                               - 4 -

     Deductions are a matter of legislative grace, and a taxpayer

must satisfy the specific statutory requirements for the

deductions he claims.   Deputy v. duPont, 308 U.S. 488 (1940); New

Colonial Ice Co. v. Helvering, 290 U.S. 435 (1934).   A taxpayer

bears the burden of proving entitlement to deductions claimed.

Rule 142 (a); Welch v. Helvering, 292 U.S. 111 (1933).     These

rules apply to deductions claimed for charitable contributions.

See Davis v. Commissioner, 81 T.C. 806, 815 (1983), affd. without

published opinion 767 F.2d 931 (9th Cir. 1985).

     In order to claim a charitable contributions deduction, a

taxpayer must establish that a gift was made to a qualified

entity organized and operated exclusively for an exempt purpose,

no part of the net earnings of which inures to the benefit of any

private individual.   Sec. 170(c)(2).   Therefore, the Court must

first examine whether the Center, the recipient of the bulk of

petitioner’s contributions,4 was a “qualified entity” under

section 170.

     Qualified entities under section 170 are generally

organizations that qualify for an exemption under section

501(c)(3).   See, e.g., Dew v. Commissioner, 91 T.C. 615, 623


     4
      Petitioner introduced at trial evidence that he contributed
approximately $100 to various other charitable organizations.
Furthermore, petitioner testified that he contributed even
greater amounts to these charitable organizations during each of
the years at issue. The Court is satisfied that he did not make
such contributions, and, if he did, petitioner did not establish
whether they were made to qualified charitable organizations.
                                - 5 -

(1988); Taylor v. Commissioner, T.C. Memo. 2000-17.    To qualify

for exemption under section 501(c)(3), the entity must (1) be

organized and operated exclusively for religious or charitable

purposes, (2) have no part of its earnings inuring to the benefit

of a private individual, and (3) have no substantial part of its

activities consist of the dissemination of propaganda or be

otherwise attempting to influence legislation.    Sec. 1.501(c)(3)-

1, Income Tax Regs.   Although they are separate requirements, the

“private inurement” test and the “operated exclusively for exempt

purposes” test prescribed by section 501(c)(3) often

substantially overlap.     Church of Ethereal Joy v. Commissioner,

83 T.C. 20, 21 (1984).   It is these two tests, in conjunction,

that the Court addresses in deciding this case.

     Petitioner claims that the Center operated exclusively for

an exempt purpose, as a church, contending that the Center held

regular services, received offerings, and had a clearly

identifiable membership.    Despite this testimony, however,

petitioner offered little evidence to substantiate his claim.

There is no evidence that petitioner, as its pastor, performed

marriages, burials, baptisms, or other sacerdotal functions, and,

while petitioner did obtain an associate’s degree from West

Angeles Church in California, he is not a licensed or ordained

minister.   Furthermore, although petitioner testified the Center

kept books and records documenting the offerings it received and
                               - 6 -

listing its members, he failed to produce such evidence at

trial.5

     Petitioner appeared as a motivational speaker at various

functions throughout Georgia and introduced into evidence several

letters thanking him for his service.   In addition, petitioner

sent tape recordings of his “sermons” to several organizations

and also introduced into evidence several letters thanking him

for the tapes.   The letters addressed petitioner as “Reverend” or

“Pastor” but made no mention of the church petitioner maintains

he represents.   Petitioner failed to substantiate, either to

respondent or to this Court, the relationship of his speaking

ministry to the Center.   However, were the Court to assume,

arguendo, that the Center operated for an exempt purpose, the

test is not merely that an organization have an exempt purpose,

but that it must operate “exclusively” for that exempt purpose.

     The definition of “exclusively”, under section 501(c)(3)

does not mean solely or absolutely without exception.   Church in

Boston v. Commissioner, 71 T.C. 102 (1978).   The Supreme Court,

however, has ruled the term has a fairly narrow definition.



     5
      When asked for a membership list, petitioner introduced
into evidence a flier advertising “Mastering Manhood Seminars and
Conferences”. The flier listed 10 men, including petitioner, who
were available to speak for seminars and workshops on various
motivational topics. Petitioner did not testify that the listed
men were members of the Center, nor did he explain why he
considered the flier an accurate membership list; therefore, the
Court declines to give much weight to this evidence.
                                - 7 -

Better Bus. Bureau v. United States, 326 U.S. 279 (1945).     In

Better Bus. Bureau, the Supreme Court stated:    “the presence of a

single * * * [nonexempt] purpose, if substantial in nature, will

destroy the exemption regardless of the number or importance of

truly * * * [exempt] purposes”.    Better Bus. Bureau v. United

States, supra at 283.    Therefore, even if the Court were

satisfied that the Center had an exempt purpose, the existence of

a substantial nonexempt purpose, furthered by the organization’s

activities, would preclude it from qualifying under section

501(c)(3).   Church of World Peace, Inc. v. Commissioner, T.C.

Memo. 1994-87.

     Petitioner testified extensively about the book publishing

activities of the Center, contending that the publishing and

distribution of literature was a significant aspect of the

Center’s activities.    The Center paid for the publishing of such

titles as “Why People Choose the Wrong Mate”, “Beware of the

Spirit of Religion”, and “How to Make the Devil Obey You”.

Petitioner authored each of the books and pamphlets that the

Center published.   Although the books had a religious theme,

writing and publishing books is not a religious activity unless

petitioner can prove the primary purpose for publishing the books

was not for profit but for the furtherance of a nonexempt

purpose.   The Inc. Trs. of the Gospel Worker Socy. v. United

States, 510 F.Supp. 374 (D.C.D.C. 1981); Pulpit Res. v.
                                - 8 -

Commissioner, 70 T.C. 594 (1978).    Petitioner testified that the

Center distributed the books at cost; however, he introduced no

evidence in support of this statement.    Absent introduction of

any financial statements from the Center whatsoever, the Court

cannot evaluate whether the Center did not in fact profit from

the publishing and distribution of books.    Therefore, the Court

finds that the publishing and distributing of books by the Center

was a substantial nonexempt activity.

     The existence of this substantial nonexempt purpose

precludes the Center from qualifying as an exempt organization

under section 501(c)(3).    In addition, the nature of this

nonexempt activity, publishing books, was conducted for the

exclusive benefit of petitioner, not the public.    As noted above,

petitioner authored each of the books the Center published.      He

then paid all publishing costs from his personal bank account and

deducted the costs as a charitable deduction on his Federal

income tax returns.    Respondent argues that petitioner

essentially incorporated the Center to enable the publishing of

books he authored.    Respondent’s argument is well founded.    As

previously noted, petitioner’s testimony was that a substantial

percentage of his earnings went to the Center; yet, his was the

sole authorized signature of this account.    No evidence was

offered to establish that the Center had members or received

contributions from others.    The Center did not maintain any books
                                 - 9 -

and records.     In effect, petitioner was using a claimed church as

his pocket book.     Therefore, the Court agrees with respondent,

and the Center also fails the “private inurement” test of section

501(c)(3).     Because petitioner’s contributions were to a

nonexempt organization, they are not deductible on his Federal

income tax return.6    Therefore, respondent is sustained on this

issue.

         Respondent determined section 6662(a) penalties in the

amounts of $743.20, $496.60, $439.40, and $688.00 for the years

1998, 1999, 2000, and 2001, respectively.      Section 6662 provides

for a 20-percent penalty for any underpayment to which the

section applies.     Sec. 6662(a).   Respondent determined that

section 6662(a) applied because petitioner was negligent or

disregarded rules or regulations.      Sec. 6662(b)(1).

     Negligence is defined as “any failure to make a reasonable

attempt to comply with the provisions of this title”.      Disregard

includes “careless, reckless, or intentional disregard”.      Sec.

6662(c).     The entirety of petitioner’s deductions for the years



     6
      Only a fraction of the amounts claimed as charitable
contributions on petitioner’s Federal income tax returns were in
the form of cash donations. The bulk of the deductions were for
payments petitioner made out of his personal bank account “on
behalf” of the Center, such as rent, natural gas and electricity
for petitioner’s personal residence, religious books, and office
supplies. Because the Court has denied the deduction of
contributions to the Center by petitioner, it is not necessary to
discuss the eligibility of the nature of petitioner’s
contributions.
                               - 10 -

at issue was disallowed.   Petitioner presented very little

evidence as to how he arrived at the amounts for most of the

contributions claimed on his returns.    In addition, the majority

of petitioner’s claimed charitable deductions were for personal

expenses.    The Court holds that petitioner disregarded rules and

regulations and sustains the section 6662(a) penalties for the

years at issue.

     Respondent also determined a section 6651(a)(1) addition to

tax for the year 1998 in the amount of $100.    A taxpayer is

liable for an addition to tax for failure to file a return timely

unless such failure “is due to reasonable cause and not due to

willful neglect.”   Sec. 6651(a)(1).    Willful neglect is defined

as “a conscious, intentional failure, or reckless indifference.”

United States v. Boyle, 469 U.S. 241, 245 (1985).     Petitioner was

required to file a timely Federal income tax return for 1998.

Sec. 6012.

     Petitioner filed his 1998 Federal income tax return

untimely, on April 1, 2002.7   Due to the lack of testimony or

other evidence explaining why he waited almost 3 years to file

his 1998 tax return, the Court holds that petitioner is liable

for the section 6651(a)(1) addition to tax for 2000.




     7
      Petitioner also filed his 1999 and 2000 Federal income tax
return untimely; however, respondent did not determine the sec.
6651(a)(1) addition to tax for those years.
                            - 11 -

    Reviewed and adopted as the report of the Small Tax Case

Division.



                                      Decision will be entered

                                  for respondent.
