John H. Webster - Page 8

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          relating to reasonable cause and lack of willful neglect.  It is            
          mandatory and extenuating circumstances are irrelevant.”  Estate            
          of Ruben v. Commissioner, 33 T.C. 1071, 1072 (1960).  Petitioner            
          does not argue, nor do we find, that any statutory exception                
          under section 6654 applies in this case.  Accordingly, we sustain           
          respondent’s determination on this issue.                                   
               The Tax Court is authorized under section 6673(a)(1) to                
          require a taxpayer to pay to the United States a penalty not in             
          excess of $25,000 when it appears to the Court that the                     
          taxpayer’s position in the proceeding is frivolous or groundless.           
          Petitioner’s position, based on stale and meritless contentions,            
          is manifestly frivolous and groundless, and his action has                  
          resulted in the waste of limited judicial and administrative                
          resources.  At trial we warned petitioner of these penalty                  
          provisions, and he promptly brought his arguments to an end.                
          Under these circumstances we shall not impose a penalty under               
          section 6673(a)(1) at this time, but we caution petitioner that             
          the imposition of the penalty is likely if he returns to this               
          Court with similar arguments in the future.                                 
               Reviewed and adopted as the report of the Small Tax Case               
               To reflect respondent’s concession,                                    
                                                  Decision will be entered            
                                             under Rule 155.                          

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