Hugh Powell Arvin - Page 9

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               We note that 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 the proceeding has been                    
          instituted or maintained by the taxpayer primarily for delay or             
          that the taxpayer's position in such proceedings is frivolous or            
          groundless.  In this case, we conclude that the position advanced           
          by petitioner is frivolous and groundless.  Nevertheless,                   
          respondent has not asked for penalties under section 6673 to be             
          imposed, and we choose not to do so at this time.  We caution               
          petitioner that such penalties under section 6673 may be imposed            
          if he continues to advance the same frivolous and groundless                
          arguments in the future.                                                    
               Reviewed and adopted as the report of the Small Tax Case               
               To reflect the forgoing,                                               

                                                       Decision will be               
                                                  entered for respondent.             

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