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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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