Basil Nicholas Stephanatos - Page 5

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          agents.  He persisted in his course of scurrilous threats against           
          the IRS.  He did not turn over receipts in accordance with the              
          Court’s Standing Pretrial Order.  At the time of trial,                     
          respondent filed a Motion for Sanctions and Costs Pursuant to               
          I.R.C. Sec. 6673, setting out examples of petitioner’s failure to           
          cooperate in the determination of his correct tax liability and             
          his pursuit of frivolous arguments.                                         
                                       OPINION                                        
               Although prior to trial petitioner had pursued many of the             
          stale arguments common to tax protesters, at trial he had                   
          “refined” his position to two arguments:  First, petitioner                 
          argues that he had no taxable “gain” at the end of any year                 
          because, after paying for food, water, utilities, “mandatory                
          taxes” such as Social Security taxes and income taxes, recovery             
          of the cost of his education, and setting aside amounts for                 
          future retirement and medical costs, he had little left.  Second,           
          he had no “dominion” over the wages he received because, at the             
          end of the year, they had been spent on essentials.                         
               Several passages from his testimony leave no doubt that                
          petitioner contends that he may deduct all of his personal                  
          expenses, current and future, before paying tax on his wages:               
                    I’m only relying on myself funding my own                         
               retirement.  Then deduct whatever, of course, cost I                   
               owe to various persons and then whatever business                      
               expenses, whatever other life expenses, you know, eat                  
               food, drink water and then come up with my taxable real                
               income.                                                                





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