                         T.C. Memo. 2003-46



                       UNITED STATES TAX COURT



               GARY JAMES COPELAND, Petitioner v.
          COMMISSIONER OF INTERNAL REVENUE, Respondent




     Docket No. 9305-02L.             Filed February 25, 2003.



     Gary James Copeland, pro se.

     Rollin G. Thorley, for respondent.



                         MEMORANDUM OPINION


     CHIECHI, Judge:    This case is before the Court on respon-

dent’s motion for summary judgment and to impose a penalty under
                              - 2 -

section 66731 (respondent’s motion).2   We shall grant respon-

dent’s motion.

                           Background

     The record establishes and/or the parties do not dispute the

following.

     Petitioner resided in Henderson, Nevada, at the time he

filed the petition in this case.

     On or about April 15, 1998, petitioner filed a Federal

income tax (tax) return for his taxable year 1997 (1997 return).

In his 1997 return, petitioner reported total income of $0, total

tax of $0, and claimed a refund of $238.11 of tax withheld.

Petitioner attached a two-page document to his 1997 return

(petitioner’s attachment to his 1997 return).   That document, as

completed by petitioner, stated in pertinent part:

     I, Gary J. Copeland am submitting this as part of my
     1997 income tax return

     Even though I know that no section of the Internal
     Revenue Code:
          1) establishes an income tax “liability” as, for
     example, Code Sections 4401, 5005, and 5703 do with
     respect to wagering, alcohol, and tobacco taxes;
          2) provides that income taxes “have to be paid on
     the basis of a return”-as, for example, Code Sections
     4374, 4401(c), 5061(a) and 5703(b) do with respect to
     other taxes;


     1
      All section references are to the Internal Revenue Code in
effect at all relevant times. All Rule references are to the Tax
Court Rules of Practice and Procedure.
     2
      Although the Court ordered petitioner to file a response to
respondent’s motion, petitioner failed to do so.
                         - 3 -

I am filing anyway, because I know that the government
has prosecuted others for failing to file income tax
returns by (erroneously) invoking Code Sections 7201
and 7203. Therefore, this return is not being filed
voluntarily, but is being filed out of fear that if I
did not file this return, I could also be (illegally)
prosecuted for failing to file an income tax return for
the year 1997.

     3) In addition to the above, I am filing even
though the “Privacy Act Notice” as contained in a 1040
booklet clearly informs me that I am not required to
file. It does so in at least two places.

          a) In one place, it states that I need only
file a return for “any tax” I may be “liable” for.
Since no Code Section makes me “liable” for income
taxes, this provision notifies me that I do not have to
file an income tax return;

          b) In another place, it directs me to Code
Section 6001. This section provides, in relevant part,
that “Whenever in the judgment of the Secretary it is
necessary, he may require any person by notice served
upon such person; or by regulations, to make such
returns, render such statements, or keep such records,
as the Secretary deems sufficient to show whether or
not such person is liable for the tax under this ti-
tle.” Since the Secretary of the Treasury did not
“serve” me with any such “notice” and since no legisla-
tive regulation exists requiring anyone to file an
income tax return, I am again informed by the “Privacy
Act Notice” that I am not required to file an income
tax return.

   *       *       *       *       *       *       *

     7) It should also be noted that I had “zero”
income according to The Supreme Court’s definition of
income * * * since in Merchant’s Loan & Trust Co v.
Smietanka, 225 U.S. 509, (at pages 518 & 519) that
court held that “The word (income) must be given the
same meaning in all of the Income Tax Acts of Congress
that was given to it in the Corporation Excise Tax Act
of 1909.” Therefore, since I had no earnings in 1997
that would have been taxable as “income” under the
Corporation Excise Tax Act of 1909, I can only swear to
having “zero” income in 1997. Obviously, since I know
                                - 4 -

     the legal definition of “income”, if I were to swear to
     having received any other amount of “income”, I would
     be committing perjury * * *. So, not wishing to commit
     perjury * * * I can only swear to having “zero” income
     for 1997. [Reproduced literally.]

     On or about April 15, 1999, petitioner filed a tax return

for his taxable year 1998 (1998 return).   In his 1998 return,

petitioner reported total income of $0 and total tax of $0.

Petitioner attached a three-page document to his 1998 return

(petitioner’s attachment to his 1998 return), which was very

similar to petitioner’s attachment to his 1997 return.

     On August 3, 2000, respondent issued to petitioner a notice

of deficiency (notice) with respect to his taxable years 1997 and

1998, which he received.   In that notice, respondent determined a

deficiency in, and an accuracy-related penalty under section 6662

on, petitioner’s tax (1) for his taxable year 1997 in the respec-

tive amounts of $2,104 and $421 and (2) for his taxable year 1998

in the respective amounts of $2,021 and $404.

     Petitioner did not file a petition in the Court with respect

to the notice relating to his taxable years 1997 and 1998.

Instead, on October 30, 2000, in response to the notice, peti-

tioner sent a letter (petitioner’s October 30, 2000 letter) to

the Internal Revenue Service.   That letter stated in pertinent

part:

               Your Deficiency Notice dated August 3, 2000

          According to your “Deficiency Notice” of above
     date (cover sheet [page 1 of notice with respect to
                         - 5 -

petitioner’s taxable years 1997 and 1998] attached),
there is an alleged deficiency with respect to my 1997
& 1998 income taxes of $2,104.00 & $2021.00 respec-
tively, and if I wanted to “contest this deficiency
before making payment,” I must “file a petition with
the United States Tax Court.” Before I file, pay, or
do anything with respect to your “Notice,” I must first
establish whether or not it was sent pursuant to law,
whether or not it has the “force and effect of law,”
and whether you had any authority to send me the notice
in the first place.

   *       *       *       *       *       *       *

     Let me further point out that IR Code Sections
6001 and 6011 (as identified in the 1040 Privacy Act)
notify me that I need only “comply with regulations.”
Nothing in the Privacy Act Notice or in the above
statutes informs me that I have to “comply” with, or
pay attention to, letters and/or alleged “determina-
tions” sent to me by various and sundry employees of
the IRS.

     Please note that Section 6212 states that “If the
Secretary determines that there is a deficiency in
respect of any tax ... he is authorized to send notice
of such deficiency, etc., etc., etc.” However, the
“Notice” I received was not sent by the Secretary, but
by James J. Walsh, who is identified as being the
District Director in Phoenix, AZ, and I have no way of
knowing whether he has been delegated by the Secretary
to send out such notices on the Secretary’s behalf. So
before I do anything at all with respect to your “No-
tice,” I would have to see a Delegation Order from the
Secretary of the Treasury delegating to James J. Walsh,
the authority to send out Deficiency Notices.

     In addition, I would also like you to send me (or
identify for me) the legislative regulations that you
claim implement Code Sections 6212 and 6213. I have
also attached an excerpt from the IRS Procedures Manual
* * * which points out that the IRS is required to
“make available to all taxpayers comprehensive, accu-
rate, and timely information on the requirements of tax
law and regulations.” So, pursuant to this provision
from your Procedures Manual, I am asking that you
identify (“make available”) for me the legislative
regulations that you claim implement both Code Sections
                               - 6 -

     6212 and 6213, since I have not been able to locate
     them.

          Without your furnishing me with these documents
     and information, I will be unable to “ascertain” * * *
     whether the individual who sent me the Deficiency
     Notice was authorized to do so, and whether I am le-
     gally required to take any notice of it. * * *
     [Reproduced literally.]

     On January 8, 2001, respondent assessed petitioner’s tax, as

well as any penalties and interest as provided by law, for each

of his taxable years 1997 and 1998.    (We shall refer to those

assessed amounts, as well as interest as provided by law accrued

after January 8, 2001, as petitioner’s unpaid liabilities for

1997 and 1998.)

     On January 8, 2001, respondent issued to petitioner a notice

of balance due with respect to petitioner’s unpaid liabilities

for 1997 and 1998.

     On August 14, 2001, respondent issued to petitioner a final

notice of intent to levy and notice of your right to a hearing

(notice of intent to levy) with respect to his taxable years 1997

and 1998.   On or about September 10, 2001, in response to the

notice of intent to levy, petitioner filed Form 12153, Request

for a Collection Due Process Hearing (Form 12153), and requested

a hearing with respondent’s Appeals Office (Appeals Office).

Petitioner attached a document to his Form 12153.    That document

stated in pertinent part:

          I am requesting a “Due Process Hearing” as out-
     lined in From 12153. I am “challenging the appropri-
                         - 7 -

ateness of (the) collection action” as specified
6330(c)(2)(A)(ii). If any IRS employee attempts to
deny me the “Due Process Hearing” guaranteed to me by
law, or recommends that seizure action be taken without
producing the documentation required by sections 6320
and 6330, or without addressing the issues provided for
in these Code Sections, I will seek damages * * * and
seek that employees termination * * *.

     I am requesting to see copies of the following
documents:

1) A copy of the statutory “Notice and Demand”
2) A copy of the record of my assessments. And since
Code Section 6201(a)(1) and IRS Transaction Code 150
states “all assessments have to be based on filed
returns” I will have to see a copy of the returns from
which any claimed assessments are based.
3) The name or names of the IRS employees who imposed
the “frivolous” penalty along with their Federal ID
number.
4) The delegation of authority from the Secretary
authorizing such persons to impose a “frivolous” pen-
alty.
5) The official job description(s) of those IRS employ-
ees who imposed the “frivolous” penalty.
6) Code Section 6001 and 6011 (which are specifically
mentioned in the Privacy Act Notice in the 1040 book-
let) advise the public that they need only to “comply
with regulations,” I am requesting that you also have
at the hearing the Treasury regulation that allows IRS
employees to impose the “frivolous” penalty, and the
regulation that requires me to pay it.
7) Lastly, I will be challenging the existence of the
underlying tax liability, which Code Section
6330(c)(2)(b) specifically authorizes me to do.

     In lieu of producing these specified documents
listed above, “verification from the Secretary (of the
Treasury) that the requirements of any applicable law
or administrative procedures have been met”, will be
acceptable. But the appeals officer better have either
the documents as identified above, or “verification
from the Secretary”. If the appeals officer can not
produce neither document, than no Due Process Hearing
should be scheduled until he has those documents in
hand. * * * [Reproduced literally.]
                               - 8 -

     On April 22, 2002, respondent’s Appeals officer held an

Appeals Office hearing with petitioner with respect to the notice

of intent to levy.   At the Appeals Office hearing, the Appeals

officer relied on Form 4340, Certificate of Assessments, Pay-

ments, and Other Specified Matters (Form 4340), with respect to

each of petitioner’s taxable years 1997 and 1998.

     On May 7, 2002, the Appeals Office issued to petitioner a

notice of determination concerning collection action(s) under

section 6320 and/or 6330 (notice of determination).   An attach-

ment to the notice of determination stated in pertinent part:

     The Secretary has provided you with sufficient verifi-
     cation that the requirements of any applicable law or
     administrative procedures have been met.

     You requested a Collection Due Process Hearing under
     IRC 6330 opposing levy action. Your Request for a
     Collection Due Process was timely filed and you are
     entitled to judicial review.

     The case was assigned to Tony Aguiar, Appeals Officer,
     who had no prior involvement with respect to the dis-
     puted tax liability.

     The levy notice reflects a liability for income taxes
     owed for 1997 and 1998. Zero type income tax returns
     were filed for 1997 and 1998. Statutory Notices of
     Deficiency were sent to you for both years on August 3,
     2000. You responded to the sent Statutory Notice of
     Deficiency with your interpretation of the tax laws.
     You were given an opportunity to petition the United
     States Tax Court and choose not to. The Statutory
     Notice of Deficiency defaulted and an assessment was
     made. The assessment made is valid. The assessment
     has been made and notice and demand letters were issued
     by regular mail to your last known address as required
     and demonstrated by forms 4340s in the administrative
     file.
                               - 9 -

     You have not challenged the appropriateness of the levy
     action. At your Collection Due Process Hearing you
     spoke about whether the assessment made was done so by
     one delegated with the authority to do so. You stated
     you do not believe you received a proper Statutory
     Notice of Deficiency for the Secretary of the Treasury
     did not sign it. I explained it [sic] the Statutory
     Notice of Deficiency does not have to be signed by the
     Secretary of the Treasury to be valid. You have been
     previously given an opportunity to contest the amount
     assessed as income tax. Due to fact you have had a
     previous opportunity the underlying liability is not to
     be considered under the Collection Due Process.

     Review of the information stated above and now present
     in the administrative file shows the requirements of
     all applicable laws and administrative procedures have
     been met. Assessments were properly made. You were
     billed and did not pay the amounts due. Collection
     proceeded with enforced collection and they should be
     allowed to continue.

     It is Appeals determination that the proposed collec-
     tion action balances the need for efficient collection
     of taxes with the legitimate concern that collection
     action is no more intrusive than necessary.

                            Discussion

     The Court may grant summary judgment where there is no

genuine issue of material fact and a decision may be rendered as

a matter of law.   Rule 121(b); Sundstrand Corp. v. Commissioner,

98 T.C. 518, 520 (1992), affd. 17 F.3d 965 (7th Cir. 1994).

We conclude that there is no genuine issue of material fact

regarding the questions raised in respondent’s motion.

     With respect to petitioner’s taxable years 1997 and 1998,

petitioner received a notice of deficiency, but he did not file a

petition with respect to that notice.    In the petition, peti-

tioner admits that he received the notice of deficiency and
                              - 10 -

alleges that “the deficiency notice Petitioner received was

invalid, because it was not sent out by the Secretary as required

by Code Section 6212.”   On the instant record, we find that

petitioner may not challenge the existence or the amount of

petitioner’s unpaid liabilities for 1997 and 1998.3   See sec.

6330(c)(2)(B); Sego v. Commissioner, 114 T.C. 604, 610-611

(2000); Goza v. Commissioner, 114 T.C. 176, 182-183 (2000).

     Where, as is the case here, the validity of the underlying

tax liabilities is not properly placed at issue, the Court will

review the determination of the Commissioner of Internal Revenue

for abuse of discretion.   Sego v. Commissioner, supra at 610;

Goza v. Commissioner, supra at 181-182.

     As was true of petitioner’s attachment to his 1997 return,

petitioner’s attachment to his 1998 return, petitioner’s October

30, 2000 letter, and petitioner’s attachment to Form 12153, the

petition contains contentions, arguments, and requests that the

Court finds to be frivolous and/or groundless.    To illustrate,

petitioner contends in the petition that respondent failed to

issue petitioner the notice and demand for payment required by

section 6303(a).   We reject that contention.   Forms 4340 with

respect to petitioner’s taxable years 1997 and 1998 show that



     3
      We note that, pursuant to Rule 37(c), petitioner is deemed
to have admitted that he may not challenge the existence or the
amount of his unpaid liabilities for 1997 and 1998 because he
received a notice of deficiency with respect to those years.
                               - 11 -

respondent sent petitioner a notice of balance due on January 8,

2001, the same day on which respondent assessed petitioner’s tax,

as well as any penalties and interest as provided by law, for

each of those years.   A notice of balance due constitutes the

notice and demand for payment under section 6303(a).     Craig v.

Commissioner, 119 T.C. 252, 262-263 (2002).

       As a further illustration of the frivolous and/or groundless

nature of petitioner’s position in this case, petitioner contends

in the petition that the Appeals officer failed to obtain and to

produce verification that the requirements of any applicable law

or administrative procedure have been met, as required by section

6330(c)(1).    The record establishes that the Appeals officer

obtained verification from the Secretary that the requirements of

any applicable law or administrative procedure were met, and we

reject petitioner’s contention to the contrary.    At the Appeals

Office hearing, the Appeals officer relied on Forms 4340 with

respect to petitioner’s taxable years 1997 and 1998.    Section

6330(c)(1) does not require the Appeals officer to rely on a

particular document to satisfy the verification requirement

imposed by that section.    Craig v. Commissioner, supra at 261-

262.    Nor does section 6330(c)(1) require the Appeals officer to

provide petitioner with a copy of the verification upon which the

Appeals officer relied.    Id. at 262.   Form 4340 is a valid

verification that the requirements of any applicable law or
                             - 12 -

administrative procedure have been met.   Id.   Petitioner has not

shown any irregularity in respondent’s assessment procedure that

would raise a question about the validity of the assessments or

the information contained in Forms 4340 with respect to peti-

tioner’s taxable years 1997 and 1998.   We hold that the assess-

ments with respect to petitioner’s taxable years 1997 and 1998

were valid and that the Appeals officer satisfied the verifica-

tion requirement of section 6330(c)(1).   See id.4

     Based upon our examination of the entire record before us,

we find that respondent did not abuse respondent’s discretion in

determining to proceed with the collection action as determined


     4
      We shall not specifically address any additional matters,
such as the following, which petitioner asserts in his petition,
all of which, as indicated above, the Court finds to be frivolous
and/or groundless:

          6)   * * * But in any case, Petitioner
               pointed out to the appeals officer, if
               he would simply identify for Petitioner
               the statute that established Peti-
               tioner’s income tax “liability”; Peti-
               tioner would pay the taxes and penalties
               at issue without further adieu. * * *

          7)   Petitioner asked the appeals officer to
               identify for Petitioner the statute that
               required Petitioner “to pay” the income
               taxes at issue. Even though the exis-
               tence of such a statute was a “relevant
               issue relating to the unpaid tax,” as
               stated in 6330(c)(2)(A). Despite the law
               specifically providing that this issue
               could be raised (since it is obviously a
               “relevant issue.” What could be more
               relevant?) the appeals officer refused
               to identify any such statute. * * *
                               - 13 -

in the notice of determination with respect to petitioner’s

taxable years 1997 and 1998.

     In respondent’s motion, respondent requests that the Court

require petitioner to pay a penalty to the United States pursuant

to section 6673(a)(1).   Section 6673(a)(1) authorizes the Court

to require a taxpayer to pay to the United States a penalty in an

amount not to exceed $25,000 whenever it appears to the Court,

inter alia, that a proceeding before it was instituted or main-

tained primarily for delay, sec. 6673(a)(1)(A), or that the

taxpayer’s position in such a proceeding is frivolous or ground-

less, sec. 6673(a)(1)(B).

     In Pierson v. Commissioner, 115 T.C. 576, 581 (2000), we

issued an unequivocal warning to taxpayers concerning the imposi-

tion of a penalty under section 6673(a) on those taxpayers who

abuse the protections afforded by sections 6320 and 6330 by

instituting or maintaining actions under those sections primarily

for delay or by taking frivolous or groundless positions in such

actions.

     In the instant case, petitioner advances, we believe primar-

ily for delay, frivolous and/or groundless contentions, argu-

ments, and requests, thereby causing the Court to waste its

limited resources.   We shall impose a penalty on petitioner

pursuant to section 6673(a)(1) in the amount of $1,000.

     We have considered all of petitioner’s contentions, argu-
                             - 14 -

ments, and requests that are not discussed herein, and we find

them to be without merit and/or irrelevant.

     On the record before us, we shall grant respondent’s motion.

     To reflect the foregoing,

                                      An appropriate order granting

                                 respondent’s motion and decision

                                 will be entered for respondent.
