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C. Penalty Under Section 6673(a)
Respondent moved the Court at the end of trial to impose a
penalty under section 6673(a)(1). Respondent asserts that
petitioner’s position in this case is frivolous and groundless.
Respondent also asserts that petitioner instituted these
proceedings primarily for the purpose of delay.
Section 6673(a)(1) authorizes the Court to require a
taxpayer to pay to the United States a penalty of up to $25,000
whenever it appears that proceedings have been instituted or
maintained by the taxpayer primarily for delay or that the
taxpayer’s position in such proceeding is frivolous or
groundless. Here, petitioner did not offer any evidence at
trial, nor did he otherwise make any legitimate attempt to prove
respondent’s determinations wrong. Petitioner was warned by
respondent before trial and was warned by the Court during trial
that his position (or lack thereof) was without merit and could
subject him to a penalty of up to $25,000 under section 6673(a).
Petitioner disregarded these warnings and has consumed wastefully
the time, resources, and effort of the Court. We conclude from
the record that petitioner’s positions in this proceeding are
frivolous and without merit. We also conclude from the record
that petitioner has instituted and maintained this proceeding
primarily for delay. Pursuant to section 6673, we require
petitioner to pay to the United States a penalty of $10,000.
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Last modified: May 25, 2011