FI L ED U.S. COURT OF A P P E A LS E LE V EN T H C IR C U IT J ANUARY 13 , 2006 THOMAS K. KAH

N CL ERK [DO NOT PUBLISH]
IN THE UN ITED STATES COURT OF APPEALS FO R T HE EL EV EN TH CIRC UI T

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N o. 05- 1091 6 Non-A rgum ent Calendar

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. S. T ax Co urt N o. 893 4- 00 TH OMA S G . B RENN ER , Pet it io ne r-Ap pe ll an t,
ve rs us COMM ISSI ONER OF INTERNAL REVENUE, Respondent -Appellee

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Appe al f ro m aD ec isi on o f the United States T ax Court

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(J an ua ry13, 200 6) Be fo re E D MO N D SO N , Ch ie f Judg e, CA RN E S an d M A RC U S, Ci rc uit Jud ge s. PE R CU RIA M:2

Pe tit ion er -Appe llant T hom as G
. Br enne r, pr oc ee din g pr o se , appe al s th e de ci sio n of

the ta x c ourt de te rm ini ng tha t ( i) the not ic e of de fi ci en cy

iss ue d to Br enne r w as va lid ; ( ii) no c onst itu tio na l arg um en t a dvanc ed by Br enne r atta ck ing the im posi tio n of

af ed er al inc om e ta x w as va lid ; and ( iii ) sanc tio ns w er e due to be im po se d fo r Bre nn er’s p ers is te nc e in ad va nc in g fr iv ol ou s ar gu m en ts . No
r e v e r s i b l e e rr o r

h a s b e e n s h o w n ; w e a f

f i rm. Brenner filed no tax returns for tax y ears 1991 throug h 199 7, and no tax was wi th h el do n i n co m e B re n n erea rn eddu ri n g th at p er i o d . To d et erm i n e B re n n er ’s tax liabilityfor those y ears, the IRS sough t inform ation from him ; but Brenner, cl ai m ing aF if

th A m en dm en t pr ivi le ge , r ef use d to pr ovi de r ec or ds and s ough t t o pr ev en t thir d part ie s f

ro m pr ovi din g in fo rm at ionto the I RS
. A ft er r ec onstru ct ing Bren ne r’s in co m e u si ng th e b an k d ep os it s m et ho d, a n ot ic e o f de fic ie nc y is su ed
. Br enne r fi le d ti m el y

ac ha lle nge to the va lid ity of the de fi ci en cy

not ic e an d to the tax calculated by

the IRS
. Be fo re the ta x c ourt, the I RS tw ic e soug ht and w as gr an te d apr ote ct ive
or de r ag ai nst

Br enne r’ s di sc ove ry

r eque sts w hic h in cl ude d gr ound le ss o r fr ivo lou s (o r both) c ont en tio ns. T he ta x c ourt c au tio ne d B re nne r m or e than on ce that i t
w oul d be inc lin ed

to im pose ape na lty

on h im if he c ont inu ed

to advanc e fr ivo lou s or gr ound le ss arg um en ts. B re nne r m ove d f or sum m ar y j udgm en t onthe gr ound3

that the I RS ha d su

bm itt ed “ dum m y ” re tur ns o n hi s be ha lf

that di d no t c om

ply with 26 U. S. C. §§ 60 20(a)-( b) and 6211 , which sections Bre nner argued require the IRS to file substi tute invo luntary returns. Ac cording to Brenner’ s summ ary j udgm en t m oti on, be ca

use he f ile d no ta x r et

ur ns ( an d th e IR S fi le d no sub sti tut e inv oluntary

r et ur ns) , no “ de fi ci en cy ” co uld be va lid
. T he I RS r es pond ed that,
co ntr ar y to Br enne r’ s c ont en tio n, se ct ion621 1( a) r equir es no s ubst itu te r et ur n to be prepare d before deter

m ining a defic iency

and issui ng a notice; the IRS
supp or te d fu ll y

it s re sp on se wit h c it at io n t o c as e la w. T he m atte r pr oc ee de d to tr ia l. T he I RS intro duc ed e vid en ce de ta ili ng the
re co nstru ct ionof

Br enne r’ s in co m e fr om

bank d ep osi ts and i nc om e pa id t o Br enne r as r ep orte d to the I RS by the pay or s. B re nne r inv oke d th e Fi fth A m en dm en t and r ef

use d to te sti fy
. O n c ro ss- ex am inatio n of I RS w itn es se s, Brenner focused on the IRS’ s failure to com plete a “ subs titute for return;” Br enner intro duc ed

no e vid en ce to ch al le nge the inc om e ca lc ulatio ns. Br enne r’ s pr inc ipl e co nte nti on b ef or e the ta x c ourt, and a ga in o n a ppe al , is that no not ic e of

de fi ci en cy

c anbe va lid

unl es s th e ta xpay er

f ile s ar et ur n or the IRS prepares a

subst itute return for the y ears at issue. A s the tax court observed
co rr ec tly , se ct ion602 0( b) a llo w s pr ep ar at ionof asub sti tut e re tur

n f or anon -f ili ng taxpay er; but a section 6211 (a) deficiency can be deter

m ined in th e absence of a4

subs tit ute r et ur n. S ee U nit ed

S ta te s v. S ta ff

or d, 983 F
. 2d 2 5, 27 ( 5 Ci r. 199 3) th (“ althoug h the section [§ 602 0(b)] authorizes the Secr etary to file for a

taxpay er, the statute does no t require such a f iling .” ). Courts have stated repeatedly that section 621 1(a) r equires no sub stitut e re turn to be prepared by the IRS before de te rm ini ng a

de fi ci en cy

and i ssu ing anot ic e of

de fi ci en cy . S ee G ei se lm anv. United States, 961 F.2d 1, 5 (1 Cir. 1992 ) (c onclud ing th at the deficiency st procedures in the Code do no t require I RS to prepar e tax re turn for taxpay er bef ore de te rm ini ng i nc om e ta x de fi ci en cy ); S ch if f v. U nit ed

S ta te s, 919 F
. 2d 8 30, 832 ( 2d Cir. 1990 ) (“ when a ta xpay er does not file a tax r eturn, it is as if he filed a r eturn show ing az er o am ount

f or pur pose s of a sse ssi ng a

de fi ci en cy . T he re is no requirem ent that the IRS c om plete a substitu te return”) ; Roat v. C omm issio ner, 847 F. 2d 1 379, 138 1- 82 ( 9 Ci r. 198 8) ( “ D ef ic ie nc y pr oc ed ur es se t ou t i n th e th In te rn al Re ve nue Co de , 26 U
. S. C. § 62 11- 13, do n ot r equir e the Co m m iss ionto pr ep ar e a re tur

n onta xpay er ’ s be ha lf

be fo re de te rm ini ng and i ssu ing anot ic e of de fi ci en cy . ”)
. N oth ing in the Co de ’ s stru ct ur e or langua ge sup ports r ea din g tog ethe r se ct ion602 0( b) ’ s pr ovi sio ns a llo w ing pr ep ar at ionof sub sti tut e re tur

ns and the Code’ s deficiency provisio ns, 26 U. S. C. §§ 62 11-13. Roat, 847 F.2d at 1381 -8 2. Ar

ule r equir ing pr ep ar at ionof asub sti tut e re tur

n a s ac ondi tio n pr ec ed en t t o anot ic e of

de fi ci en cy

w oul d be c ontrary

to ta x po lic y . I d.Br enner ’s claim that a g raduated income tax is unconstitutional, a lbeit routinely championed by 1 tax protesters, is forec losed by Supr em e C o u rt prec edent a nd war rants no fur

ther c omment. See Br ushaber v. Union Pac. R. Co., 36 S.C t. 236, 244 (1916). 5 Br enne r co m

pla ins that se ct ion621 1 de fi ne s a“ de fi ci en cy ” to i nc lud e onl y the a m ount

by w hic h th e ta x im

pose d e xc ee ds the a m ount sho w n onthe ta x r et

ur n; ab se nt a return, n o d efi ci en cy can ex is t. Bre nn er re co gn iz es th atTreas . Reg . § 301. 6211 -1 , 26 C
. F. R. § 30 1. 6211 -1 , state s e xpr es sly that, if no r et ur n is f ile d,
se ct ion621 1' s r ef

er en ce to “ ‘ the a m ount

sho w n a s th e ta x by

the ta xpay er

upo n hi s re tur n’ sha ll be c onsi de re d z er o. ” § 30 1. 6211 -1 (a ). N one the le ss B re nne r as se rt s that the r eg ulatio n on ly

de fi ne s de fi ci en cy

in te rm s of

af ile d r et ur n be ca use any o th erd ef i n i t i o n wo u l di m

p erm i s s i b l y ex p an dth e u n d er l yin g l eg i s l at i o n . B re n n er ’s str ai ne d arg um en t - - w hic h he c ont en ds r ai se s an is sue of f ir st i m pr es sio n inthi s circuit -- is belied by

the Suprem e Court’ s pronou ncem ent that “ [w ] here there has been no tax return filed, the def iciency is the am ount of tax due,” L aing v. U nited St at es , 96 S.Ct . 47 3, 4 81 (19 76 ), an d t ha t Co ur t’s ci ta ti on to Treas . Reg . § 301.621 1-(a)
. Brenner’ s claim that the notice of deficiency issued to him

wa s inv al id i s w ith out

m er it. 1 Br enne r al so t ak es iss ue w iththe im posi tio n ( sua spon te ) by

the ta x c ourt of $15, 000 in s an ct ion s. T he ta x c ourt i s e m pow er ed to im pose a pe na lty of up t o $25, 000 on a

ta xpay er if , a m ong oth er

r ea sons , it

appe ar s to the c ourt tha t the6

ta xpay er ins tit ute d or m ai nta ine d pr oc ee din gs p ri m ar ily f or de lay , or the t ax p ayer ’s p o s i t i o n wa s fr i v o l o u s o r g ro u n d l es s . 2 6 U.S .C . § 6 6 7 3 (a )( 1 ). We
re vie wthe im

posi tio n of

sanc tio ns f

or abuse of dis cr et ion
. R obe rt s v. Com m issio ner, 329 F.3d 1224 , 1229 (11 Cir. 2003 ). th W e see no abuse of discretion. T he tax court twice issued protectiv e orders in r es pons e to B re nne r’ s di sc ove ry m oti ons an d ona t l ea st tw o oc ca sio ns p ut Br enne r on n oti ce that hi s c la im s w er e fr ivo lou s; h e w as w ar ne d sp ec if

ic al ly that i f he pe rs is te d i n a ss ert in g fr iv ol ou s cl ai m s h e co ul d b e su bjec t t o s an ct io ns . Br enne r, und aunte d by

the ta x c ourt’ s c au tio ns, m ove d f or sum m ar y j udgm en t on the ve ry ba sis of the c la im s th e ta x c ourt ha d di sc re dit ed
. A nd, pr oc ee din g to tr ia l, Brenner m ade no attem

pt to challenge the m erits of the IR S’ s deficiency de te rm inatio n; h e dogg ed ly a dvanc ed

his ba se le ss c ha lle nge to the va lid ity of the
no ti ce o f de fic ie nc y

an d ali ta ny of o th er m eri tl es s co ns ti tu ti on al arg um en ts . As
w e have not ed

- - an d a s B re nne r w as tol d r ep eate dly - - the lawpe rt ai nin g to Br enne r’ s c la im

is (and w as ) cl ear an d w el l- se ttl ed
. U nde r the se c ir cum stanc es , no ab use of dis cr et ionha s be ensho w n inthe ta x c ourt’ s or de r im posi ng s an ct ion s.26 U.S.C. § 7482(c) (4) authorizes the C ourt of Appeals to impose a penalty when a ffirmingthe 2 tax court if it appear s that the appe al was ma intained primarily for de lay or the taxpay er’ s position is f ri vo lou s. The Commissioner states that, during 2001 and 2002, the avera g e expense in attorne y salarie s 3 and other costs incurre d by

the Tax D ivision of the Depa rtment of Just ice in the de fense of fr ivolous taxpay e r a

pp e a ls i n whic h s anc tio ns we re awa rd e d w a s a

pp ro ximate ly

$6 ,9 00. A lum

p- sum is reque sted to save “ the g overnme nt the additional cost of calc ulating its e x penses, and also [to save] the cour t the time and expense of revie wing the submissions of costs.” Parker v. Commi ssioner, 117 F.3d 785, 787 (5 Cir. 1997)
. See Stoecklin v. Commi ssioner, 865 F.2d 1221, 1226 (11 Cir. 1989) th th (imposing a lump-sum sanction where appellant raised frivolous arguments in the tax court and on appea l). 7 T he Co m m iss ion er m ove s purs uant t o th e In te rn al Re ve nue Co de and R ule 2 38 o f the F ed er al Ru le s of Appe llate P ro ce dur e fo r the im posi tio n of

$60 00 i n sanc tio ns t o c om

pe nsate part ia lly

the gov er

nm ent f or it s di re ct c ost s of de fe ndi ng ag ai nst af ri vol ous ap pe al
. I n th e lig ht o f the w el l- se ttl ed c as e lawr ej ec tin g co nsi ste ntl y

the pos iti ons advanc ed

by Br enne r, tog ethe r w iththe e xpl ic it
wa rn i n g s o ff

er edb y th e t ax co u rt(b o th b ef o re an di n s up p o rto f t h at co u rt ’s im po si ti on of s an ct io ns in th is m at te r), Ru le 38 san ct io ns are ap pr op ria te . AF FIRMED ; the Co m

m iss ion er ’ s m oti on f

or sanc tio ns i n th e lum

p- sum of $6, 000 is GRANTED.

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