TP Proffers a "Greatest Hits" of Protestor Nonsense in CA10

[jcolvin2]

http://www.ca10.uscourts.gov/opinions/13/13-9000.pdf

UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
ERNEST JAN FOWLKE,
Petitioner-Appellant,
v.
COMMISSIONER OF INTERNAL
REVENUE,
Respondent-Appellee.
No. 13-9000
(T.C. No. 24767-10)
(Tax Court)
ORDER AND JUDGMENT*
Before HOLMES, HOLLOWAY, and BACHARACH, Circuit Judges.

Mr. Ernest Jan Fowlke appeals the Tax Court’s assessment of additional taxes
and imposition of sanctions. Mr. Fowlke admits that he earned money, but denies a
duty to pay income tax. We affirm.

Background

Mr. Fowlke did not file federal income tax returns from 2004 to 2008. Based
on substitute returns, the Internal Revenue Service assessed tax deficiencies under
26 U.S.C. § 6651(a)(1) (failure to file timely tax returns), § 6651(a)(2) (failure to timely pay taxes), and § 6654 (failure to make estimated tax payments). Mr. Fowlke
challenged these assessments by petitioning the Tax Court.

The Commissioner of Internal Revenue moved for judgment on the pleadings,
and Mr. Fowlke moved to dismiss. With these filings, the Tax Court held a hearing
and found that the claims involved a meritless protest against the federal income tax
system. Thus, the court granted the Commissioner’s motion, denied Mr. Fowlke’s
motion to dismiss on grounds of mootness, and sanctioned Mr. Fowlke for making
frivolous arguments. This appeal followed.

Tax Court’s Alleged Delay in Filing Documents

According to Mr. Fowlke, the Tax Court delayed filing his motion to dismiss
and response to the Commissioner’s motion. With this contention, Mr. Fowlke
asserts that the Tax Court ruled without the benefit of his response brief. These
representations are incorrect.

Mr. Fowlke states that the Tax Court “entered” the motion to dismiss and
response brief on March 6, 2012, conducted a hearing six days later, and issued a
decision over a month later. Appellant’s Informal Br. at 4-5. Thus, even under
Mr. Fowlke’s chronology, the Tax Court would have had the benefit of the motion to
dismiss and response brief at the time of the hearing. This sequence is confirmed in
the record, for the judge in Tax Court referred to Mr. Fowlke’s motion to dismiss and
response brief. Tr. at 3. Because the judge had the motion to dismiss and response brief when she conducted the hearing, any delay in filing the documents would not
have affected the outcome.

The Commissioner’s Motion for Judgment on the Pleadings

We conduct de novo review over the Tax Court’s grant of judgment on the
pleadings. See Nelson v. State Farm Mut. Auto. Ins. Co., 419 F.3d 1117, 1119
(10th Cir. 2005) (a motion for judgment on the pleadings is reviewed de novo).
In challenging the Tax Court’s judgment, Mr. Fowlke argues that he is not
subject to taxation, that the income tax falls on earnings from “privileges” but not
“rights,” that the tax falls only on “United States persons” and he is not one, that the
Tax Examiner lacked authority to issue a notice of deficiency, and that the Tax Court
lacked jurisdiction. These arguments are invalid.

First, Mr. Fowlke argues that the tax is imposed on income, but is not directed
to any person or entity. We rejected this argument in Charczuk v. Commissioner of
Internal Revenue, 771 F.2d 471, 473 (10th Cir. 1985), and must follow that decision.

The second argument is that the Constitution confines the taxation power to
privileges, rather than rights (such as the right to earn a living). We rejected this
argument, as well, in Charczuk, 771 F.2d at 472-73, and characterized the argument
as frivolous in Lonsdale v. United States, 919 F.2d 1440, 1447-48 (10th Cir. 1990).
Again, we must follow these precedents and reject Mr. Fowlke’s argument.

Third, Mr. Fowlke denies that he is a “United States person” because that
phrase is used elsewhere to refer to foreign corporations. This contention is frivolous. The tax code defines the term “United States person” to include citizens or
residents of the United States. 26 U.S.C. § 7701(a)(30) (2006). Because Mr. Fowlke
does not deny that he is a citizen or resident of the United States, he is considered a
“United States person” under the tax law.

Fourth, Mr. Fowlke contends that the notice of deficiency was issued by a Tax
Examiner, who exceeded his authority under the Internal Revenue Manual. But, the
Manual does not give rights to the taxpayer. See Armstrong v. Commissioner of
Internal Revenue, 15 F.3d 970, 975 (10th Cir. 1994) (holding that the Internal
Revenue Manual is directory rather than mandatory and lacks the force and effect of
law). Thus, we reject Mr. Fowlke’s argument based on the Internal Revenue Manual.
Mr. Fowlke’s fifth argument is that the Tax Court lacked jurisdiction because
he is not a “taxpayer.” This argument is circular because it turns on his contention,
rejected elsewhere, that he is not subject to the income tax.

The Tax Court has jurisdiction over cases begun by “taxpayers.” Tax Court
Rule 13(a)(1). Under federal law, the term “taxpayer” includes “any person subject
to any internal revenue tax.” 26 U.S.C. § 7701(a)(14) (2006). As discussed
elsewhere, Mr. Fowlke is subject to the income tax; as a result, the Tax Court had
jurisdiction.

Sanctions

In addition to challenging the Tax Court’s finding of a deficiency, Mr. Fowlke
challenges its imposition of sanctions. We reject this challenge. The Tax Court is authorized to impose sanctions up to $25,000 when a taxpayer suit is frivolous or
intended to create delay. 26 U.S.C. § 6673(a)(1)(A)-(B) (2006). The court applied
this authority here, sanctioning Mr. Fowlke $5,000 because it viewed Mr. Fowlke’s
claims as groundless. Tr. at 10.

We review these sanctions for an abuse of discretion;1 and in doing so, we
conclude that the Tax Court acted within its discretion. Like the district court, we
believe that Mr. Fowlke’s underlying arguments are groundless because they are
plainly foreclosed by governing case law or statutes.

Conclusion

As a result, we affirm the Tax Court’s judgment.
Entered for the Court
Robert E. Bacharach
Circuit Judge

* This order and judgment does not constitute precedent. See Tenth Cir. R.
32.1(A).

1 See Lewis v. Commissioner of Internal Revenue Service, 523 F.3d 1272, 1274
(10th Cir. 2008) (“Tax Court sanctions are reviewed for an abuse of discretion.”).

[Cathulhu]

Looks like he Fowlked up.

[Burnaby49]

Looks like he Fowlked up.

I was thinking it was nice to have you back after your hiatus over personal issues (how's the back doing?).

However, after that comment, I'm reconsidering.

[Cathulhu]

Hey, still have the pain, always will. But muscles in torso all firing again, yay! I hate waking up a little paralyzed.

You're just jealous I said it before you did. I'm amazed J. didn't note this himself.










edited to fix error because I really need my coffee now...

[LPC]

Yep, that's all, Fowlkes.

[LPC]

The Tax Court opinion is an oral bench opinion, Docket No. 24767-10 (4/30/2012). Excerpts:

Petitioner was a realtor and a real estate developer in Utah during the years at issue. He did not file a Federal income tax return for any of the five years at issue. Respondent prepared substitutes for return (SFRs) for those years based upon bank deposits, cash payments, and third-party information reports.

Petitioner timely filed a petition containing only tax-protester arguments.

It is a fundamental tax principle that gross income includes all income from whatever source derived, including wages, nonemployee compensation, interest, and dividends. Sec. 61(a) (1). Petitioner does not dispute that he received payments. Simply put, he denies he is a taxpayer. Simply put, he is. We need not discuss Petitioner's erroneous positions at length. See Wnuck v. Commissioner, 136 T.C. No. 24 (2011). We therefore sustain the deficiency determination in Respondent's statutory notice.

Petitioner asks us to grant his motions to dismiss. He argues that we do not have jurisdiction to hear the case because he is not a taxpayer. He again reverts to the same patently frivolous arguments.

We have jurisdiction because Respondent mailed a valid deficiency notice, and Petitioner timely filed a petition for redetermination. See Rule 13(a) and (c); Monge v. Commissioner, 93 T.C. 22, 27 (1989); Normac, Inc. v. Commissioner, 90 T.C. 142, 147 (1988).

We note that granting Petitioner's motions to dismiss would have the same effect as granting Respondent's motion for judgment on the pleadings. Whenever we dismiss a case on a ground other than the lack of jurisdiction, we generally must enter a decision finding that the deficiency in tax is the amount determined in the deficiency notice. See Sec. 7459(d); Estate of Ming v. Commissioner, 62 T.C. 519, 522 (1974). Accordingly, we deny Petitioner's motion to dismiss as moot.

Respondent orally moved to impose a penalty under Section 6673 and recommended a $5,000 penalty because the amounts at issue are substantial, but there were no prior years before the Court.

We note that the type of arguments Petitioner raises have been deemed by this Court to be frivolous and/or sanctionable under Section 6673. The purpose of Section 6673 is to compel taxpayers to think and to confirm their conduct to settled tax principles. Coleman v. Commissioner, 791 F.2d 68, 71 (7th Cir. 1986); see also Grasselli v. Commissioner, T.C. Memo 1994-581.

In this proceeding now before the Court, Petitioner asserts nothing but frivolous and groundless arguments. It is apparent from the entire record that Petitioner instituted or maintained this proceeding primarily, if not exclusively, as a protest against the Federal income tax system and his proceeding in this Court is merely a continuation of Petitioner's refusal to acknowledge and satisfy his tax obligations. We are convinced that no purpose would be served in repeating all that has been said about his frivolous and misguided arguments.

Petitioner is Pro Se and seeks leniency from the Court. Pro Se status, however, is not a license to litter the dockets of the Federal courts with ridiculous allegations. Parker v. Commissioner, 117 F.3d 785 (5th Cir. 1997).

We therefore shall require Petitioner to pay a penalty of $5,000 pursuant to Section 6673(a) (1). In addition, we take this opportunity to admonish Petitioner that the Court will consider imposing a greater penalty if Petitioner returns to the Court and advances similar arguments in the future.

[Famspear]

Petitioner does not dispute that he received payments. Simply put, he denies he is a taxpayer. Simply put, he is.

Boy, resolving that issue didn't take much time.....