- 5 -
* * * * * * *
10) In addition, don’t notify me that the IRS is
“changing” my return, since there is no statute that
allows the IRS to do that. You might prepare a return
(pursuant to Code Section 6020(b)), where no return is
filed, but as in this case, a return has been filed, no
statute authorizes IRS personnel to “change” that
return.
* * * * * * *
*Note #1: The word “income” is not defined in the
Internal Revenue Code. * * * But, as stated above, it
can only be a derivative of corporate activity. * * *
B. Petitioner’s Failure To File for 1998
Petitioner failed to file a return or submit to respondent a
Form 1040 for the taxable year 1998.
C. Respondent’s Deficiency Notice and Petitioner’s Response
On December 8, 1999, respondent (acting through James J.
Walsh, District Director in Phoenix, Arizona) issued a notice of
deficiency to petitioner for the taxable years 1997 and 1998. In
the notice, respondent determined deficiencies in petitioner’s
Federal income taxes, an addition to tax, and an accuracy-related
penalty as follows:
Addition to Tax Accuracy-related Penalty
Year Deficiency Sec. 6651(a)(1) Sec. 6662(a)
1997 $2,966 —–- $593
1998 9,914 $2,479 ---
Insofar as his ultimate tax liability was concerned,
respondent gave petitioner credit for the amounts withheld from
his wages. However, we note that the determination of a
statutory deficiency does not take such withheld amounts into
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