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moneymaking sole proprietorship by refusing to cooperate with
respondent during the audit. Fifth, petitioner misstated the
facts of his case in the affidavit, when he stated that he had no
source of income, and that he was not involved in a trade or
business. We conclude that petitioner failed to file Federal
income tax returns for each of the subject years with the intent
to conceal, mislead, or otherwise prevent the collection of
Federal income tax due and owing from him, and we sustain
respondent's determinations of the same.
As to respondent's motion for imposition of sanctions under
section 6673, section 6673(a)(1) allows this Court to award a
penalty not in excess of $25,000 when proceedings have been
instituted or maintained primarily for delay, or where the
taxpayer's position is frivolous or groundless. A taxpayer's
position is frivolous or groundless if it is contrary to
established law and unsupported by a reasoned, colorable argument
for change in the law. Coleman v. Commissioner, 791 F.2d 68, 71
(7th Cir. 1986); Sicalides v. Commissioner, T.C. Memo. 1989-164.
In our opinion, such is the case here, and we believe that a
penalty is appropriate. We will require petitioner to pay a
$5,000 penalty to the United States under section 6673(a).
To reflect the foregoing,
An appropriate order and
decision will be entered.
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Last modified: May 25, 2011