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We hold that respondent's determinations of a deficiency in
petitioner's Federal income tax for 1994 and additions to tax for
1994 pursuant to sections 6651(a)(1) and 6654(a) are sustained.
The second issue for decision is whether we should, sua
sponte, impose a penalty on petitioner pursuant to section
6673(a).
Whenever it appears to this Court that proceedings before it
have been instituted or maintained by the taxpayer primarily for
delay or that the taxpayer's position in such proceeding is
frivolous or groundless, the Court, in its discretion, may
require the taxpayer to pay to the United States a penalty not in
excess of $25,000. See sec. 6673(a)(1)(A) and (B). A position
maintained by a taxpayer in the Tax Court is frivolous "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).
Petitioner made numerous frivolous arguments in her trial
memorandum and at trial. She has caused this Court to waste its
limited resources on her erroneous views of the tax law while the
resolution of other taxpayers' bona fide controversies with
respondent were delayed. On the other hand, despite the lack of
any merit in petitioner's arguments, respondent failed to make a
motion to dismiss this case and proceeded to trial. Respondent
also failed to make any motion for a penalty under section 6673.
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