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frivolous or groundless or the proceedings were instituted
primarily for delay. Sec. 6673(a)(1)(B). A position maintained
by the taxpayer is frivolous if it is “contrary to established
law and unsupported by a reasoned, colorable argument for change
in the law.” Coleman v. Commissioner, 791 F.2d 68, 71 (7th Cir.
1986); Gilligan v. Commissioner, T.C. Memo. 2004-194.
Petitioners made numerous frivolous arguments during the
administrative proceedings, in these proceedings, and in the
petition. In lieu of appearing at trial, petitioners submitted a
statement in which they made more frivolous arguments.
We will deny respondent’s motion to impose a penalty under
section 6673. However, we warn petitioners that the Court may
impose this penalty in the future if petitioners make frivolous
arguments or institute proceedings primarily for delay.
To reflect the foregoing and concessions by respondent and
because of computational adjustments,
An appropriate order will
be issued, and decision will
be entered under Rule 155.
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Last modified: May 25, 2011