Court Opinion

ID: 8406267
Source: CourtListenerOpinion
Date Created: 2022-10-28 00:01:17.409616+00
Date Added: 2024-06-11T16:47:10.463557
License: Public Domain

Case: 22-60204     Document: 00516524957         Page: 1     Date Filed: 10/27/2022

              United States Court of Appeals
                   for the Fifth Circuit
                                 ___________                         United States Court of Appeals
                                                                              Fifth Circuit

                                  No. 22-60204
                                                                            FILED
                                                                     October 27, 2022
                                Summary Calendar
                                 ___________                           Lyle W. Cayce
                                                                            Clerk
   Michael R. Lowe,

                                                           Petitioner—Appellant,

                                       versus

   Commissioner of Internal Revenue,

                                             Respondent—Appellee.
                   ______________________________

                        Appeal from a Decision of the
                          United States Tax Court
                          Tax Court No. 10954-20
                   ______________________________

   Before Wiener, Elrod, and Engelhardt, Circuit Judges.
   Jacques L. Wiener, Jr., Circuit Judge:*
          Appellant Michael Lowe appeals the Tax Court’s decision on his tax
   deficiencies. Lowe was given ample warning of the frivolous nature of his
   claims, yet here we are.

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 22-60204        Document: 00516524957              Page: 2       Date Filed: 10/27/2022

                                         No. 22-60204

           In 2017, Lowe was employed by AltairStrickland LLC as a “site
   quality manager.” That year, he received $193,068.81 for his work. Lowe
   claims no tax liability on this amount, because—in his own words—these
   “payments were not the result of any federal taxable activity whatsoever,
   were private, non-reportable, and did not constitute any excise amount of
   gains, profits, or income subject to any relevant income tax law of the United
   States.” Unsurprisingly, the Tax Court found all of that inapposite, correctly
   applying well-established law to a clear record. 1
           Because the Tax Court entered its decision after a trial on the
   merits, we review its findings of fact for clear error and its conclusions of
   law de novo. See Green v. Comm’r, 507 F.3d 857, 866 (5th Cir. 2007) (“Clear
   error exists when [we are] left with the definite and firm conviction that a
   mistake has been made.”).
           As this court has noted time and time again, “[w]e perceive no need
   to refute these arguments with somber reasoning and copious citation of
   precedent; to do so might suggest that these arguments have some colorable
   merit.” 2 Crain v. Comm’r, 737 F.2d 1417, 1417 (5th Cir. 1984); see also
   Williams v. Comm’r, 801 F. App’x 328, 329 (5th Cir. 2020), cert. denied, 141
   S. Ct. 1067 (2021).
           The record is clear that Lowe was provided ample opportunity to
   present his case to his fullest ability. The Tax Court was not obligated to
   accept Lowe’s self-assessment—which simply states that his tax liability was

           1
              At trial, Lowe affirmed that the source of these funds was his “work at
   AltairStrickland” and that he used this money to pay his mortgage, utilities, and other
   expenses.
            2
              On appeal, Lowe accuses the Tax Court and government counsel of “extortion,”
   conspiracy and other unlawful acts. Putting aside that these issues were brought here in the
   first instance, Lowe cites only statutes without regard for caselaw or addressing key
   assumptions premised on his misinterpretation of the tax code.

                                                2
Case: 22-60204      Document: 00516524957          Page: 3   Date Filed: 10/27/2022

                                    No. 22-60204

   $0—or his testimony regarding that assessment. See New England Merchants
   Nat. Bank v. Rosenfield, 679 F.2d 467, 473 (5th Cir. 1982) (reasoning that
   “neither [the trial or appellate] court is required to accept, as credible,
   unsupported self-serving testimony that flies in the teeth of unimpeachable
   contradictory evidence and universal experience”). We find no reason to
   depart from, or add to, the Tax Court’s thorough decision that Lowe had
   received unreported taxable income and that he failed to demonstrate that
   the government’s assessment was arbitrary or erroneous. See Toledano v.
   Comm’r, 362 F.2d 243, 245 (5th Cir. 1966).
          We now turn to Appellee Commissioner of Internal Revenue’s
   motion for sanctions against Lowe. The Internal Revenue Code authorizes
   us to impose a penalty in cases “where the decision of the Tax Court is
   affirmed and it appears that the appeal was instituted or maintained primarily
   for delay or that the taxpayer’s position in the appeal is frivolous or
   groundless.” 26 U.S.C. § 7482(c)(4). The Tax Court graciously spared Lowe
   of sanctions but warned him that the further advancement of frivolous
   arguments may prove otherwise.
          Having granted Lowe the courtesy of a response to the possibility of
   sanctions, we have no concern with the imposition of sanctions for his
   frivolous appeal. Appeals are frivolous when the result is obvious or the
   arguments of error are wholly without merit. Buck v. United States, 967 F.2d
   1060, 1062 (5th Cir. 1992). This court is no stranger to sanctions in similarly
   baseless tax cases. See Tello v. Comm’r, 410 F.3d 743, 744 (5th Cir. 2005).
   The Commissioner requests a lump-sum sanction of $8,000 and provides
   persuasive reasoning of that calculation. We agree that this amount is fair,
   and conclude that imposing a lump sum sanction, in lieu of costs, conserves
   the same government and judicial resources which Lowe is keen to waste.

                                         3
Case: 22-60204    Document: 00516524957         Page: 4   Date Filed: 10/27/2022

                                 No. 22-60204

         We AFFIRM the decision of the Tax Court, and GRANT the
   Commissioner’s motion for sanctions in the amount of $8,000 against Lowe.

                                      4