                        T.C. Memo. 2005-281



                      UNITED STATES TAX COURT



                  GLEN B. SILVER, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 15740-04.               Filed December 5, 2005.



     Glen B. Silver, pro se.

     Kevin M. Murphy, for respondent.



             MEMORANDUM FINDINGS OF FACT AND OPINION


     COHEN, Judge:   Respondent determined deficiencies of

$34,578.07 and $34,855 in petitioner’s Federal income taxes for

2001 and 2002, respectively.   Respondent also determined that

petitioner was liable for additions to tax of $3,344.45 and

$1,666.11 under section 6651 and $426.25 and $217.06 under

section 6654 for those years, respectively.     Because petitioner
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did not raise any bona fide dispute with respect to the amounts

determined by respondent, the only issue for decision is the

appropriate amount of a penalty under section 6673.    Unless

otherwise indicated, all section references are to the Internal

Revenue Code in effect for the years in issue, and all Rule

references are to the Tax Court Rules of Practice and Procedure.

                          FINDINGS OF FACT

     Petitioner resided in New York at the time that he filed his

petition.   During the years in issue, petitioner was employed by

LSI Logic Corp.    Petitioner received wages of $60,796.32 in 2001

and $98,452.38 in 2002 from LSI Logic Corp.    Those wages were

reported to the Internal Revenue Service (IRS) on Forms W-2, Wage

and Tax Statement.

     During 2002, petitioner received a distribution from Charles

Schwab Trust Co., Trustee, in the amount of $33,112.44.    That

distribution was reported to the IRS on Form 1099-R,

Distributions From Pensions, Annuities, Retirement or Profit-

Sharing Plans, IRAs, Insurance Contracts, etc.

     Petitioner failed to file Federal income tax returns for

2001 and 2002.    Based on reports received from LSI Logic Corp.

and Charles Schwab Trust Co., Trustee, and other third-party

payers, respondent made the determinations set forth in the

notices of deficiency.
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     Petitioner filed two prior cases in this Court (and one

subsequent case).   Docket No. 3112-03 involved petitioner’s

Federal income tax liability for 1997, 1998, and 2000.    In an

oral opinion rendered September 21, 2004, the Court sustained

deficiencies and additions to tax under sections 6651(a)(1) and

6654(a) for each of those years.   In addition, the Court stated:

          I am also granting * * * the government’s motion
     for a penalty under Section 6673. As I did yesterday,
     I will make it in the relatively low amount of $3,000,
     but noting that the Court’s official records show that
     Mr. Silver has filed a case docketed in the ‘04 year, I
     urge him to reconsider any positions he takes that may
     result in an increase in penalties for making similar
     arguments in that case when it’s called next year about
     this time.

The reference to “yesterday” was to the Court’s oral opinion

rendered on September 20, 2004, in docket No. 15785-02L, a case

in which petitioner contested collection efforts with respect to

his tax liability for 1995 and 1996.    The Court, in docket No.

15785-02L, explained that petitioner’s arguments in that case

were frivolous, and the Court granted a motion for sanctions

under section 6673 in the amount of $3,000.

                              OPINION

     In the petition in this case, petitioner alleged that he

“did not receive any taxable income from any taxable source or

activity during the years 2001 and 2002.”    Petitioner also

alleged that he would be entitled to deductions, allowances, and

credits, but he did not specify the nature or amounts of any such
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items.   In his trial memorandum, petitioner identified the issue

as “Whether the Petitioner received the income alleged in the

Statutory Notices of Deficiency.”    He argued that the Government

had the burden of proving unreported income.     Petitioner did not

identify the nature or amount of any deductions to which he might

be entitled.   At the time of trial, petitioner relied on his view

of the Government’s burden of proof.     Petitioner declined to

testify at the trial.   His failure to produce evidence is a

ground for dismissal or for determination of the affected issues

against him.   Rule 149(b).

     At the trial, respondent presented the records of LSI Logic

Corp. and the Charles Schwab Trust Co., Trustee, concerning

payments made to petitioner during 2000 and 2001.     Those records

were authenticated by declarations from the custodians of the

records of each of the payers.    Although petitioner objected to

the records, the records were received pursuant to rules 803(6)

and 902(11), Federal Rules of Evidence, and 28 U.S.C. section

1746 (2000) (declarations under penalty of perjury).

     Respondent also introduced Certificates of Official Record,

under seal, consisting of Forms 4340, Certificate of Assessments,

Payments, and Other Specified Matters, for 2001 and 2002, and an

Information Returns Master File Transcript For The Tax Years 2002

and 2001 for petitioner.   Those records were received, over
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petitioner’s objection, under rules 803(8), 803(10), and 902(1),

Federal Rules of Evidence.

     Petitioner has failed to present any reasonable dispute with

respect to any item included in the notices of deficiency for

2001 and 2002.    In these circumstances, respondent was entitled

to rely on the third-party information.    See sec. 6201(d); Parker

v. Commissioner, 117 F.3d 785 (5th Cir. 1997).     Petitioner had

the burden of identifying and proving any deductions to which he

might be entitled.    See, e.g., Rockwell v. Commissioner, 512 F.2d

882 (9th Cir. 1975), affg. T.C. Memo. 1972-133.    He failed to do

so and has not shown that respondent’s determination is in any

way erroneous.

     The Forms 4340 also satisfy respondent’s burden of

production with respect to the additions to tax in issue.     See

sec. 7491(c); Higbee v. Commissioner, 116 T.C. 438, 446-449

(2001).

     Section 6673(a)(1) provides:

     SEC. 6673.    SANCTIONS AND COSTS AWARDED BY COURTS.

          (a) Tax Court Proceedings.--

               (1) Procedures instituted primarily for
          delay, etc.–-Whenever it appears to the Tax Court
          that--

                       (A) proceedings before it have been
                  instituted or maintained by the taxpayer
                  primarily for delay,

                       (B) the taxpayer’s position in such
                  proceeding is frivolous or groundless, or
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                       (C) the taxpayer unreasonably failed to
                  pursue available administrative remedies,

           the Tax Court, in its decision, may require the
           taxpayer to pay to the United States a penalty not
           in excess of $25,000.

      Petitioner did not specify in this case his theory why his

wages and other income are not taxable.    All of the items

included in respondent’s determination of income are identified

as gross income in section 61 and taxable under sections 1 and

63.   Arguments that wages are not taxable income, in whatever

form they appear, have been repeatedly and resoundly rejected in

innumerable cases, leading to sanctions against taxpayers at the

trial and appellate levels.    See, e.g., Coleman v. Commissioner,

791 F.2d 68 (7th Cir. 1986); Connor v. Commissioner, 770 F.2d 17

(2d Cir. 1985).

      Respondent has asked for a penalty in the maximum amount of

$25,000 in this case because, despite warnings a year earlier,

petitioner continued to maintain the same frivolous positions and

to impose extra burdens on respondent in securing evidence that

should have been stipulated by petitioner.

      The purpose of section 6673 is to deter litigants from

pursuing frivolous and dilatory claims that impose needless costs

on the courts and on respondent.    See, e.g., Coleman v.

Commissioner, supra at 72; Abrams v. Commissioner, 82 T.C. 403

(1984).   Considering prior notice to petitioner that his claims

were frivolous and the amounts involved, respondent’s motion for
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sanctions will be granted, and the maximum penalty under section

6673 in the amount of $25,000 will be awarded to the United

States.

     We take judicial notice that petitioner has filed a fourth

petition in this Court, docket No. 14694-05.       Needless to say, if

he pursues the same arguments in that case, he may expect an

additional penalty under section 6673.

     To reflect the foregoing,


                                              An appropriate order and

                                         decision for respondent will

                                         be entered.
