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On the basis of the evidentiary record and previously cited
cases, we hold that respondent has not met his burden of
production with respect to the appropriateness of imposing the
section 6651(a)(2) additions to tax.
Prior to trial, respondent filed a motion for sanctions
pursuant to section 6673. Section 6673(a)(1) provides for a
penalty whenever it appears that proceedings have been instituted
or maintained by the taxpayer primarily for delay or that the
taxpayer’s position in the proceeding is frivolous or groundless.
We have already held that petitioner’s position with respect to
his liability for tax is frivolous. Accordingly, we impose a
penalty of $2,000.
An appropriate order and
decision will be entered for
respondent except for the
additions to tax under section
6651(a)(2), which do not apply.
19(...continued)
basis that the Court of Appeals had concluded that the
Commissioner filed valid returns pursuant to sec. 6020(b) in
Smalldridge, whereas in Phillips, “No such returns were filed”.
But see Phillips v. Commissioner, 88 T.C. at 540 (Swift, J.,
dissenting) (citing the Court of Appeals opinion in Smalldridge
as a basis for concluding that there was no justification for a
finding that the Commissioner was unreasonable in arguing that
certain audit examination documents and a notice of deficiency
constituted a “return”).
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