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By motion made at the conclusion of trial, respondent
requests the Court to impose a penalty on petitioner under
section 6673(a). Section 6673(a)(1) authorizes the Tax Court to
require a taxpayer to pay a penalty not to exceed $25,000 if the
proceedings have been instituted or maintained by the taxpayer
primarily for delay or if the taxpayer's position in such
proceeding is frivolous or groundless. Sec. 6673(a)(1)(A) and
(B). A position maintained by the taxpayer is "frivolous" where
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).
Petitioner's pretrial correspondence to respondent contained
arguments that are typically deemed frivolous for purposes of
section 6673(a). The objectionable arguments, however, are
contained in documents introduced into evidence not by
petitioner, but by respondent. Petitioner's position in this
case focused almost entirely on issues related to the burden of
proof, demonstrated by his ill-fated strategy to proceed as
though it did not rest with him. Although we consider
petitioner's position on the point to be tenuous, we do not
consider it to be frivolous within the meaning of section
6673(a). Respondent's motion for a penalty under that section
will therefore be denied.
To reflect the foregoing,
An appropriate order and
decision will be entered.
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Last modified: May 25, 2011