T.C. Memo. 1999-238

UNITED STATES TAX COURT

KENNETH G. AND KIM M. BOHNET, Petitioners v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 24733-97. Filed July 22, 1999.

Kenneth G. Bohnet and Kim M. Bohnet, pro sese.

Sandra Veliz, for respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

VASQUEZ, Judge: By separate notices of deficiency,

respondent determined the following deficiencies in and additions

to petitioners' 1995 Federal income tax:

 Addition to Tax

 Petitioner Deficiency Sec. 6651(a)

 Kenneth G. Bohnet $14,899.00 $2,298.50

 Kim M. Bohnet 2,419.00 265.75
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1 Respondent concedes that the credit for withholding

income tax for Kim M. Bohnet should be $1,976 and not $1,356 as

determined. Petitioners concede that their interest income for

1995 is taxable. 

Unless otherwise indicated, all section references are to the

Internal Revenue Code in effect for the year in issue, and all

Rule references are to the Tax Court Rules of Practice and

Procedure.

After concessions,1 the issues for decision are: (1)

Whether petitioners are liable for the deficiencies determined by

respondent, (2) whether petitioners are liable for additions to

tax for failing to file a Federal income tax return for 1995, and

(3) whether petitioners engaged in behavior warranting the

imposition of a penalty pursuant to section 6673(a).

FINDINGS OF FACT

Some of the facts have been stipulated and are so found. 

The stipulation of facts and the attached exhibits are

incorporated herein by this reference. At the time they filed

their petition, Kenneth G. Bohnet (Mr. Bohnet) and Kim M. Bohnet

(Mrs. Bohnet), husband and wife, resided in Ephrata, Washington. 

In 1995, Mr. Bohnet earned $65,500 from Korach & Wilson

Insurance, Inc., $855 in nonemployee compensation from Fortis

Investors, and $173 in interest income. In 1995, Mrs. Bohnet

earned $21,874 from Grant County, Washington, and $11 in interest
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income. Petitioners did not file a Federal income tax return for

1995. 

OPINION

Section 61 defines gross income as all income from whatever

source derived. Gross income includes compensation for services

and interest. See sec. 61(a)(1), (4). In general, the

Commissioner's determinations in a notice of deficiency are

presumed correct, and taxpayers bear the burden of proving them

erroneous. See Rule 142(a). 

Petitioners do not challenge the facts on which respondent's

determinations are based or respondent's calculation of tax. 

Petitioners stipulated that during 1995 they received wages and

interest. At trial and on brief, petitioners advanced shopworn

arguments characteristic of tax-protester rhetoric that has been

universally rejected by this and other courts. See Wilcox v.

Commissioner, 848 F.2d 1007 (9th Cir. 1988), affg. T.C. Memo.

1987-225; Carter v. Commissioner, 784 F.2d 1006, 1009 (9th Cir.

1986). Petitioners allege: (1) The wages they received are not

income subject to tax under section 61; (2) the Individual Master

File states that no notice of deficiency was ever sent; (3) the

Internal Revenue Service did not send a notice of deficiency and

did not file a return as mandated by section 6020(b); (4)

petitioners did not receive any wages, were not employees as

defined, and therefore had no filing requirement; and (5) taxing
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2 Respondent, in separate notices of deficiency sent to Mr.

Bohnet and Mrs. Bohnet, determined that Mr. Bohnet is taxable on

100 percent of the compensation and interest he received and Mrs.

Bohnet is taxable on 100 percent of the compensation and interest

she received. Respondent, however, did not determine that 50

percent of the income earned by each petitioner is taxable income

to the nonearning spouse.

their wages violates the Sixteenth Amendment. We shall not

painstakingly address petitioners' assertions "with somber

reasoning and copious citation of precedent; to do so might

suggest that these arguments have some colorable merit." Crain

v. Commissioner, 737 F.2d 1417, 1417 (5th Cir. 1984). 

Accordingly, we sustain respondent's determination that these

amounts are income.

We must next decide whether this income is community

property income.2 Under Washington law, with certain exceptions,

all property (including compensation earned by a spouse) acquired

after marriage is presumed community property and treated as

acquired or earned by each spouse. See Wash. Rev. Code Ann.

secs. 26.16.010 through 26.16.030 (West 1997); Zielasko v.

Commissioner, T.C. Memo. 1993-177. Community property income is

attributable 50 percent to each spouse. See Poe v. Seaborn, 282

U.S. 101 (1930). The parties presented no evidence demonstrating

that the compensation and interest earned by petitioners are not

community property. Therefore, we conclude that under Washington
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law this income is community property and must be allocated 50

percent to each petitioner. See also Rule 142(a).

Respondent also determined that petitioners are liable for

additions to tax pursuant to section 6651(a)(1). Section

6651(a)(1) imposes an addition to tax for failure to file a

return on the date prescribed (determined with regard to any

extension of time for filing), unless the taxpayer can establish

that such failure is due to reasonable cause and not due to

willful neglect. The taxpayer has the burden of proving the

addition is improper. See Rule 142(a); United States v. Boyle,

469 U.S. 241, 245 (1985). Petitioners stipulated that they did

not file a return for 1995, and they offered no evidence showing

that their failure to file was due to reasonable cause and not

due to willful neglect. Accordingly, we hold that petitioners

are liable for the additions to tax under section 6651(a)(1).

By motion made at the conclusion of trial, respondent

requested that the Court impose a penalty pursuant to section

6673. Section 6673(a)(1) authorizes this Court to require a

taxpayer to pay to the United States a penalty not to exceed

$25,000 if the taxpayer took frivolous positions in the

proceedings or instituted the proceedings primarily for delay. A

position maintained by the taxpayer is "frivolous" where it is
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"contrary to established law and unsupported by a reasoned,

colorable argument for change in the law." Coleman v.

Commissioner, 791 F.2d 68, 71 (7th Cir. 1986).

Petitioners' position, based on stale and meritless

contentions, is manifestly frivolous and groundless, and they

have wasted the time and resources of this Court. Accordingly,

we shall grant respondent's motion, and we shall impose a penalty

of $2,500 pursuant to section 6673.

To reflect the foregoing,

An appropriate order will

be issued, and decision will

be entered under Rule 155.