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(1) Procedures instituted primarily for
delay, etc.–-Whenever it appears to the Tax
Court that--
(A) proceedings before it have been
instituted or maintained by the taxpayer
primarily for delay,
(B) the taxpayer’s position in such
proceeding is frivolous or groundless,
or
* * * * * * *
the Tax Court, in its decision, may require the
taxpayer to pay to the United States a penalty not in
excess of $25,000.
The purpose of section 6673 “is to compel taxpayers to think
and to conform their conduct to settled principles before they
file returns and litigate.” Coleman v. Commissioner, 791 F.2d
68, 71 (7th Cir. 1986); see also Grasselli v. Commissioner, T.C.
Memo. 1994-581 (quoting Coleman). A taxpayer’s position is
frivolous if it is contrary to established law and unsupported by
a reasoned, colorable argument for change in the law. E.g., Nis
Family Trust v. Commissioner, 115 T.C. 523, 544 (2000). We need
not find specific damages to invoke section 6673(a)(1); rather,
that section is a penalty provision, intended to deter and
penalize frivolous claims and positions in deficiency
proceedings. Bagby v. Commissioner, 102 T.C. 596, 613-614
(1994).
Dr. Trowbridge does not here argue for any change in the
law, and there is no plausible argument that, as maintained in
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