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Discussion
Section 6673(a)(1) Liability of Petitioner
Section 6673(a)(1) allows the Tax Court to impose a penalty
of up to $25,000, payable to the United States, when (A) a
taxpayer institutes or maintains a proceeding in the Tax Court
primarily for delay, (B) the taxpayer’s position in the
proceeding is frivolous or groundless, or (C) the taxpayer
unreasonably failed to pursue available administrative remedies.
In the case at hand, we hold that petitioner is subject to a
penalty under section 6673(a)(1) because he has taken frivolous
and groundless positions and unreasonably failed to pursue
available administrative remedies. Many of the positions
petitioner maintained throughout the Court proceedings were
frivolous or groundless. Petitioner’s “Delpit”, “Scar”, and
“Agency” arguments were entirely without merit. Petitioner’s
insistence, during most of the case, on the validity of the
trusts in the face of overwhelming contrary legal authority was
unjustified. At the administrative level, petitioner’s failure
to pursue available administrative remedies was unreasonable:
Petitioner refused to provide trust information to respondent’s
examiner, refused to produce records to support his return,
demanded written answers to irrelevant questions before he would
consider cooperating with respondent, made frivolous arguments in
response to a formal summons and failed to produce the records
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