Herndon v. Commissioner of Internal Revenue, 070518 FEDTAX, 21071-17 L

Docket Nº:21071-17 L
Opinion Judge:DIANA L. LEYDEN SPECIAL TRIAL JUDGE
Party Name:STEVEN ANDREW HERNDON, Petitioner, v. COMMISSIONER OF INTERNAL REVENUE, Respondent
Case Date:July 05, 2018
Court:United States Tax Court
 
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STEVEN ANDREW HERNDON, Petitioner,

v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

No. 21071-17 L

United States Tax Court

July 5, 2018

ORDER AND DECISION

DIANA L. LEYDEN SPECIAL TRIAL JUDGE

On March 23, 2018, respondent filed a motion for summary judgment. On April 23, 2018, petitioner filed his opposition to respondent's motion for summary judgment, wherein petitioner made the same frivolous and groundless arguments he raised at the collection due process (CDP) hearing. By order and decision entered May 7, 2018, the Court granted respondent's motion for summary judgment. In the order and decision, the Court warned petitioner about the possibility of sanctions under section 6673(a)(1):1

We take this opportunity to inform petitioner that the Court may impose a penalty of up to $25, 000 if a taxpayer institutes or maintains a frivolous or groundless position or institutes or maintains a proceeding primarily for delay.

The Court admonished petitioner that should he continue to pursue frivolous or groundless arguments before the Court he may be subject to penalties under section 6673(a)(1) up to the amount of $25, 000 in the future.

Disregarding this warning, on June 7, 2018, petitioner filed a document captioned "Motion for Reconsideration of Summary Judgment", which the Court recharacterized as a motion to vacate or revise pursuant to Rule 162 (motion to vacate). In his motion to vacate petitioner restates the same frivolous and groundless arguments he raised at the CDP hearing, in his petition, and in his opposition to respondent's motion for summary judgment. For the reasons described below, in order to impose sanctions on petitioner pursuant to section 6673(a)(1) the Court shall grant petitioner's motion to vacate and vacate our previous order and decision.

Petitioner's Motion to Vacate

The granting of a motion to vacate or revise a decision rests within the Court's discretion. Vaughn v. Commissioner, 87 T.C. 164, 166-167 (1986). In his motion to vacate petitioner continues to raise the same frivolous and groundless arguments he raised at the CDP hearing, in his petition, and in his opposition to respondent's motion for summary judgment as support for his assertion that the Court should vacate its order and decision and deny respondent's motion for summary judgment. Petitioner does so even though the Court admonished petitioner in its order and decision that should he continue to pursue frivolous or groundless arguments before the Court he may be subject to penalties under section 6673(a)(1). Therefore, in order to impose sanctions on petitioner pursuant to section 6673(a)(1) the Court grants petitioner's motion to vacate and vacates its order and decision entered May 7, 2018.

Respondent's Motion for Summary Judgment

Petitioner timely filed a petition in this case on October 10, 2017. Petitioner seeks review of a Notice of Determination Concerning Collection Action(s) Under Section 6320 and/or 6330 (notice of determination), dated September 7, 2017. The notice of determination sustained a proposed levy with respect to petitioner's unpaid tax liabilities for 2012 and 2013.

On March 23, 2018, respondent filed a motion for summary judgment. On April 23, 2018, petitioner filed a response to respondent's motion for summary judgment. On May 1, 2018, respondent's motion for summary judgment was assigned to the undersigned for disposition.

Upon review of the record on respondent's motion for summary judgment, the Court concludes that there are no genuine issues of material fact and that respondent is entitled to judgment as a matter of law. More specifically, the undisputed material facts show that during the CDP hearing petitioner did not dispute the underlying tax liabilities and failed to propose a specific collection alternative. Instead, petitioner requested that collection of his 2012 and 2013 tax liabilities be deferred indefinitely until his various grievances against the Government are redressed.

A. Background

The following facts are established by the record on respondent's motion for summary judgment and/or are not disputed by the parties.

On or about April 23, 2013, petitioner and his wife filed late their joint income tax return for 2012, showing tax due of $1, 313.63 and an earned income credit of $330, and failed to pay the balance due. On June 17, 2013, the Internal Revenue Service (IRS)2 assessed the self-reported tax due of $1, 313.63; applied the earned income credit of $330; and assessed an addition to tax under section 6651(a)(1) for failure to file of $44.26, an addition to tax under 6651(a)(2) for failure to pay of $ 14.75, and interest of $5.34. On or shortly after the same day the IRS mailed petitioner a notice and demand letter for the assessment. Petitioner and his wife did not pay the 2012 tax liability.

On or about April 21, 2015, petitioner and his wife filed late their joint income tax return for 2013, showing tax due of $2, 203, a Federal income tax withholding credit of $136, and an...

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