United States Tax Court

T.C. Memo. 2023-46

TYRONE BURNETT,

Petitioner

v.

COMMISSIONER OF INTERNAL REVENUE,

Respondent

—————

Docket No. 6818-20. Filed April 10, 2023.

—————

Tyrone Burnett, pro se.

Lynn M. Barrett, Timothy A. Lohrstorfer, and William M. Rowe, for 

respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

NEGA, Judge: By notice of deficiency dated March 9, 2020, 

respondent determined a deficiency in petitioner’s 2017 Federal income 

tax of $8,168 and additions to tax of $1,449.22, $869.53, and $149.60 

under sections 6651(a)(1) and (2) and 6654(a), respectively.1 The issues 

for decision are (1) whether respondent issued to petitioner a valid 

statutory notice of deficiency for tax year 2017; (2) whether petitioner 

failed to report taxable retirement income of $55,738 and taxable 

interest income of $40 for tax year 2017; and (3) whether petitioner is 

liable for additions to tax under sections 6651(a)(1) and (2) and 6654(a)

for tax year 2017.

1 Unless otherwise indicated, all statutory references are to the Internal 

Revenue Code, Title 26 U.S.C. (Code), in effect at all relevant times, all regulation 

references are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in effect at all 

relevant times, and all Rule references are to the Tax Court Rules of Practice and 

Procedure.

Served 04/10/23
2

[*2] FINDINGS OF FACT

At the time petitioner timely filed his Petition with this Court, he

resided in Indiana. Petitioner was retired during tax year 2017 and 

received $55,738 in retirement payments from the Defense Finance and 

Accounting Service (DFAS) and $40 in interest payments from the U.S. 

Treasury Department, Internal Revenue Service IMF (IRS).

Petitioner failed to file Form 1040, U.S. Individual Income Tax 

Return, for tax year 2017 and, amounts withheld notwithstanding, did 

not pay any tax for that year.2 Through respondent’s Automated 

Substitute for Return program, respondent prepared a substitute for 

return (SFR) for petitioner pursuant to section 6020(b). On October 21, 

2019, respondent sent to petitioner a Notice 2566, informing him that, 

despite prior notices, respondent had not received Form 1040 from 

petitioner for tax year 2017 and warning him that respondent would 

assess tax should petitioner fail to file by November 20, 2019. On March 

9, 2020, respondent issued to petitioner the notice of deficiency. 

Petitioner timely filed a Petition with the Court, disputing the 

deficiency, as well as the additions to tax under sections 6651(a)(1) and 

(2) and 6654(a).

OPINION

I. Validity of the Notice of Deficiency

The Tax Court is a court of limited jurisdiction and may exercise 

jurisdiction only to the extent authorized by Congress. Naftel v. 

Commissioner, 85 T.C. 527, 529 (1985); Breman v. Commissioner, 66 

T.C. 61, 66 (1976). Our deficiency jurisdiction depends on a valid notice 

of deficiency and a timely filed petition. Rule 13(a), (c); see, e.g., John C. 

Hom & Assocs. v. Commissioner, 140 T.C. 210, 212 (2013). Petitioner 

contends that the notice of deficiency is invalid because (1) it was not 

signed by an employee of respondent and (2) it correctly reported his 

name as “Tyrone Burnett,” in contrast to other, unrelated documents 

that listed his name as “Tyrone Burnett, Sr.” Petitioner’s arguments 

are without merit.3

2 Respondent’s records show a withholding credit applied against petitioner’s 

2017 tax liability. This withholding credit was subsequently reversed.

3 We also note that, in numerous opinions, we have determined that arguments 

asserting that a notice of deficiency is invalid because it is not signed by a particular 
3

[*3] We have previously observed that “courts have held repeatedly 

that a notice of deficiency is valid if it notifies the taxpayer that a 

deficiency has been determined and gives the taxpayer the opportunity 

to petition this Court for redetermination of the proposed deficiency.” 

John C. Hom & Assocs., 140 T.C. at 213 (first citing Frieling v. 

Commissioner, 81 T.C. 42, 53 (1983); and then citing Perlmutter v. 

Commissioner, 44 T.C. 382 (1965), aff’d, 373 F.2d 45 (10th Cir. 1967)). 

On the record before us, these threshold requirements have been met. 

Because the notice of deficiency is valid on its face, we will not look 

behind the notice to examine respondent’s motives or the administrative 

policies and procedures involved in making the notice’s determinations. 

See Greenberg’s Express, Inc. v. Commissioner, 62 T.C. 324, 327 (1974).4 

We thus find that respondent issued to petitioner a valid notice of 

deficiency for tax year 2017.

II. Retirement Income and Interest Income

In general, the Commissioner’s determinations set forth in a 

notice of deficiency are presumed correct, and the taxpayer bears the 

burden of proving them erroneous. Rule 142(a)(1); Welch v. Helvering, 

290 U.S. 111, 115 (1933). In cases appealable to the U.S. Court of 

Appeals for the Seventh Circuit, as this one is barring a contrary written 

stipulation, see § 7482(b)(1)(A), (2), a taxpayer may rebut this 

presumption by demonstrating that an assessment is arbitrary and 

excessive or lacks a rational foundation, Pittman v. Commissioner, 100 

F.3d 1308, 1313 (7th Cir. 1996), aff’g T.C. Memo. 1995-243. In cases like 

petitioner’s that involve unreported income, this showing is typically

made “when the Commissioner makes no evidentiary showing at all but 

simply rests on the presumption or when the Commissioner’s evidence 

completely fails to link the taxpayer to alleged unreported income.” Id. 

Pursuant to section 7491(a), the burden of proof as to factual matters 

shifts to the Commissioner under certain circumstances. Petitioner does 

not contend, and the evidence does not establish, that the burden of 

proof shifts to respondent under section 7491(a) as to any issue of fact. 

Therefore, petitioner bears the burden of proof as to all factual issues.

person, such as the Commissioner or a particular IRS employee, are frivolous. See, 

e.g., Reynolds v. Commissioner, T.C. Memo. 2006-192, 92 T.C.M. (CCH) 260, 262; Ball 

v. Commissioner, T.C. Memo. 2006-141, 92 T.C.M. (CCH) 7, 8.

4 The narrow exception to this rule is inapplicable to the case before us. See

Greenberg’s Express, Inc., 62 T.C. at 328.
4

[*4] Section 61(a) provides that “gross income” means “all income from 

whatever source derived.” The scope of section 61(a) is broad, and 

exclusions from gross income must be narrowly construed. 

Commissioner v. Schleier, 515 U.S. 323, 328 (1995); Commissioner v. 

Glenshaw Glass Co., 348 U.S. 426, 429 (1955); Helvering v. Clifford, 309 

U.S. 331, 334 (1940). Taxpayers seeking an exclusion from gross income 

must show that they are eligible for said exclusion and “must bring 

themselves within the clear scope of the exclusion.” Dobra v. 

Commissioner, 111 T.C. 339, 349 n.16 (1998). Section 61(a) expressly 

includes in gross income “[i]nterest” and “[p]ensions.” § 61(a)(4), (10).

Respondent submitted to the Court the following documents

authenticated pursuant to Rules 803(6) and 902(11) of the Federal Rules 

of Evidence, verifying the amounts paid to petitioner: a Wage and 

Income Transcript corresponding to petitioner’s tax year 2017, reflecting 

receipt of Form 1099–R, Distributions From Pensions, Annuities, 

Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.,

from DFAS, and Form 1099–INT, Interest Income, from the IRS; Forms 

4340, Certificate of Assessments, Payments, and Other Specified 

Matters, showing interest paid to petitioner in tax year 2017 with 

respect to overpayments on his 2013, 2014, and 2015 tax years; and 

Form 4340 corresponding to petitioner’s tax year 2017. Petitioner has 

failed to raise a reasonable dispute sufficient to shift the burden of 

producing probative information concerning the deficiency to 

respondent under section 6201(d). See Carlson v. Commissioner, T.C. 

Memo. 2012-76, 103 T.C.M. (CCH) 1408, 1409–10, aff’d, 604 F. App’x 

628 (9th Cir. 2015). Respondent is thus entitled to the presumption of 

correctness.

During trial, petitioner made various arguments to justify his 

failure to file, including an inability to access information regarding his 

retirement income and an issue where, on various unrelated documents, 

his name was listed as “Tyrone Burnett, Sr.” rather than “Tyrone 

Burnett,” as well as what seems to be a broader distrust of the 

government.5 Petitioner did not dispute receiving $55,738 from DFAS; 

rather, he expressed uncertainty as to whether the entirety of that 

amount is taxable income. Petitioner could not recall whether he 

received $40 of interest income from the IRS. Petitioner has introduced 

no evidence as to why these amounts do not constitute taxable income

and has thus failed to carry his burden of proof. Accordingly, we sustain 

respondent’s determination that petitioner received $55,738 of taxable 

5 Petitioner’s son is named Tyrone Burnett, Jr.
5

[*5] retirement income and $40 of taxable interest income in tax year

2017.

III. Penalties and Additions to Tax

A. Generally

The Commissioner bears the burden of production with respect to 

a taxpayer’s liability for penalties and additions to tax and must produce 

sufficient evidence indicating that it is appropriate to impose them. See

§ 7491(c); Higbee v. Commissioner, 116 T.C. 438, 446 (2001). As part of 

that burden, with respect to certain penalties, the Commissioner must 

also show compliance with the written approval requirement of section 

6751(b)(1). See Graev v. Commissioner, 149 T.C. 485, 493–94 (2017), 

supplementing and overruling in part 147 T.C. 460 (2016).6 Once the 

burden of production is met, the taxpayer must come forward with 

persuasive evidence that the Commissioner’s determination is incorrect 

or that the taxpayer had reasonable cause or substantial authority for 

his position. See Higbee, 116 T.C. at 446–47.

B. Section 6651(a)(1) Addition to Tax for Failure to File 

Timely

Section 6651(a)(1) authorizes the imposition of an addition to tax 

for failure to file a return timely, unless it is shown that such failure was 

due to “reasonable cause and not due to willful neglect.” See United 

States v. Boyle, 469 U.S. 241, 245 (1985). A taxpayer demonstrates 

reasonable cause when he shows that, despite exercising ordinary 

business care and prudence, he was unable to file the return on time, 

typically for reasons outside his control. Treas. Reg. § 301.6651-1(c)(1); 

see McMahan v. Commissioner, 114 F.3d 366, 368–69 (2d Cir. 1997), 

aff’g T.C. Memo. 1995-547. On the other hand, a taxpayer acts with 

willful neglect when his actions exhibit a “conscious, intentional failure 

or reckless indifference” toward compliance with his obligations under 

the Code. Boyle, 469 U.S. at 245.

6 Section 6751(b)(1) provides that “[n]o penalty under this title shall be 

assessed unless the initial determination of such assessment” receives supervisory 

approval. This provision does not apply to “any addition to tax under section 6651, 

6654, [or] 6655” or “any other penalty automatically calculated through electronic 

means.” § 6751(b)(2). Accordingly, respondent was not required to verify that the 

additions to tax determined against petitioner for tax year 2017 under sections 

6651(a)(1) and (2) and 6654 had been approved by a supervisor.
6

[*6] Petitioner failed to file a timely return for tax year 2017. 

Petitioner contended that he was “unable” to file “accurate returns,” but 

his statements in support of this position were, on the whole,

unsupported by evidence, irrelevant, or both. On the record before us, 

we find that petitioner has failed to carry his burden of establishing that 

his failure to timely file a return for tax year 2017 was due to reasonable 

cause and not due to willful neglect. We therefore sustain respondent’s 

imposition of the addition to tax under section 6651(a)(1).

C. Section 6651(a)(2) Addition to Tax for Failure to Timely 

Pay

Section 6651(a)(2) imposes upon a taxpayer an addition to tax for 

failing to pay taxes when due. This addition to tax applies whether the 

taxpayer files a return or the Commissioner prepares an SFR for the 

taxpayer. § 6651(g)(2).7 Like the addition for failure to file timely, this 

addition will not be applied when a taxpayer demonstrates that his 

failure to pay resulted from reasonable cause and not willful neglect. 

§ 6651(a)(2). A failure to pay may be considered due to reasonable cause 

to the extent the taxpayer has exercised ordinary business care and 

prudence in providing for payment of his tax liability but was 

nevertheless unable to pay the tax on the date due or would otherwise 

suffer an undue hardship. Treas. Reg. § 301.6651-1(c)(1).

Respondent prepared an SFR for petitioner, informing him that 

his retirement income and interest income resulted in a tax liability for 

2017. Petitioner did not remit timely payment for that tax liability. He

advanced no argument that his failure to pay was due to reasonable 

cause and failed to introduce any credible evidence establishing that, 

despite his acting with ordinary business care and prudence, payment 

of his 2017 tax liability posed an undue hardship. Accordingly, we find 

that petitioner has failed to establish that his failure to pay resulted 

from reasonable cause rather than willful neglect, and we sustain 

7 Petitioner’s unpaid tax resulted from an SFR prepared by respondent. 

Accordingly, as part of respondent’s burden of production with respect to the section 

6651(a)(2) addition to tax, respondent must introduce evidence sufficient to show that 

this SFR satisfies the requirements of section 6020(b). See Wheeler v. Commissioner, 

127 T.C. 200, 208–10 (2006), aff’d, 521 F.3d 1289 (10th Cir. 2008). The record contains

the IRC Section 6020(b) ASFR Certification corresponding to petitioner’s tax year

2017. We hold that this ASFR Certification satisfies the requirements of section 

6020(b) and that respondent has met his burden of production in this respect. See

Treas. Reg. § 301.6020-1(b)(2).
7

[*7] respondent’s determination as to the section 6651(a)(2) addition to 

tax.

D. Section 6654(a) Addition to Tax for Failure to Make 

Required Estimated Tax Payments

Section 6654(a) imposes an addition to tax for failure to make 

required estimated tax payments. The required annual payment of 

estimated tax is equal to the lesser of (1) 90% of the tax shown on the 

return for the taxable year (or, if no return is filed, 90% of the tax for 

such year), or (2) 100% of the tax shown on the taxpayer’s return for the 

immediately preceding taxable year.8 § 6654(d)(1)(B). Respondent 

established that petitioner filed a return for tax year 2016, that he failed 

to file a return for tax year 2017, and that he had an actual tax liability 

for 2017 but failed to make the required payments. Therefore, 

petitioner’s required annual payment for 2017 is 90% of the tax owed for 

that year. See id. cl. (i). Respondent has satisfied his burden of 

production for an addition to tax under section 6654(a). See Wheeler, 

127 T.C. at 211. Section 6654 has no general exception for reasonable 

cause or good faith, and petitioner has not shown that he satisfied any 

of the statutory exceptions under section 6654(e). See Mendes v. 

Commissioner, 121 T.C. 308, 323 (2003). Accordingly, petitioner is liable 

for the addition to tax under section 6654(a) for tax year 2017.

We have considered all the other arguments made by the parties, 

and to the extent not discussed above, find those arguments to be 

irrelevant, moot, or without merit.

To reflect the foregoing,

Decision will be entered for respondent.

8 Section 6654(d)(1)(B) provides that the 100% prior year return safe harbor 

shall not apply if the individual did not file a return for the prior taxable year.