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on respondent’s determination that petitioners failed to report
(1) wage income in the amount of $53,678 (as reported on the four
Forms W-2 described above) and (2) nonemployee compensation in
the amount of $27,941 (as reported by Carpet Max on a Form 1099-
NEC).4
By registered letter dated January 4, 2000, petitioner
Theresa Smeton wrote to the Director of respondent’s Service
Center in Ogden, Utah, acknowledging receipt of the notice of
deficiency dated October 8, 1999, but challenging the Director’s
authority “to send me the Notice in the first place.”
Petitioners sent copies of this letter by registered mail to
Robert Rubin, Secretary of the Treasury, and Charles O. Rossotti,
Commissioner of Internal Revenue.
Petitioners knew that they had the right to contest
respondent’s deficiency determination by filing a petition for
redetermination with this Court.5 However, petitioners chose not
4 Unlike their wage income, petitioners did not disclose
the receipt of nonemployee compensation on their Form 1040 for
1997. In this regard, we note that Federal income tax is not
withheld from nonemployee compensation and that petitioners’ Form
1040 was essentially nothing other than a claim for refund of all
Federal income tax that had been withheld from petitioners’
wages.
5 In this regard, the first sentence of petitioner Theresa
Smeton’s letter dated Jan. 4, 2000, stated as follows:
According to your “Deficiency Notice” of above date
(cover sheet attached), there is an alleged deficiency
with respect to my 1997 income tax of $17,471.00, and
(continued...)
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