Robert Ho - Page 3

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          Loan & Trust Co. v. Smietanka, 255 U.S. 509 (1921); (5) his                 
          return is not frivolous; (6) no IRS employee has been delegated             
          authority to determine whether a return is “frivolous” or to                
          impose a frivolous return penalty; (7) the frivolous return                 
          penalty may not be applied to him because no legislative                    
          regulation implements it; (8) no statute allows the IRS to                  
          prepare a return for him because he has filed a “return”; and (9)           
          income, for purposes of the Federal income tax, “can only be a              
          derivative of corporate activity.”                                          
               Respondent prepared a substitute return for petitioner.3  On           
          June 6, 2003, respondent issued a 30-day letter in which                    
          respondent adjusted petitioner’s income tax liability for 2001.             
          On July 6, 2003, respondent received from petitioner a letter               
          asserting the same frivolous and groundless tax protester-type              
          arguments as indicated above.                                               
          Respondent’s Notice of Deficiency                                           
               On August 1, 2003, respondent issued a notice of deficiency            
          for 2001 to petitioner at the Eagle Rock address.  In the notice            
          of deficiency, respondent determined a deficiency of $4,809, an             
          addition to tax under section 6651(a)(1) for failure to timely              
          file of $1,202.25, and an addition to tax under section 6654(a)             

               3  The substitute return in evidence is a blank Form 1040              
          that reflects only petitioner’s name, Social Security number, and           
          filing status.  See sec. 6020(b); Swanson v. Commissioner, 121              
          T.C. 111, 112 n.1 (2003).                                                   

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