…But they were phony arguments.
Roy Stallard went before the Tax Court before. In Stallard v. Commissioner (T.C. Memo 1992-593), he was fined $8,000 for making frivolous arguments. Fast forward a few years. Mr. Stallard again finds himself in Tax Court. The IRS found that he owed $52,174; he challenged it by filing a petition in Tax Court. But that petition cited numerous Tax Protester arguments, such as:
“4. Because, with respect to a tax imposed on the transfer of property, the person made liable for its payment may be the transferor, transferee or as in the case of the death tax, a third party, due process requires that Congress identify the person made liable for payment of each tax imposed, and so it usually does. The legal personality of each person made liable for the payment every other tax imposed by Congress is described clearly within the IRC, but such is not the case with regard to the purported tax debt here. There is neither an Act of Congress nor a Treasury Regulation which clearly and unequivocally identifies the person made liable for the payment of the purported tax debt.”
[Reproduced literally.]
Needless to say, the Tax Court wasn’t impressed and gave Mr. Stallard a warning:
“…[The] Court also indicated that the petition contains statements, contentions, and arguments that the Court finds to be frivolous and groundless…In the event that petitioner continues to advance frivolous and/or groundless statements, contentions, and arguments, the Court will be inclined to impose a penalty not in excess of $25,000 on petitioner under section 6673(a)(1), I.R.C.”
Surprise of surprises, Mr. Stallard responded with an amended petition that contained a series of frivolous arguments. It starts, “The notice of deficiency is notice in name only and does not meet due process of law requirements for notice….” It makes for interesting reading.
As we’ve said many times, Yes Virginia, there is an income tax and you must pay it. The Tax Court wasn’t as amused as we are in reading his arguments. The Tax Court judges just don’t have much of a sense of humor about court arguments. They warned Mr. Stallard that he could be fined $25,000. He was.
Case: Stallard v. Commissioner (T.C. Memo 2006-42)
