Lester R. Ramer v. Commissioner, No. 11623-08 (USTC 12/16/2009) (unpublished), aff'd No. 10-1584 (8th Cir. 9/30/2010) (per curiam).
The 8th Circuit opinion simply affirms the Tax Court opinion for the reasons stated in that opinion, but the order and decision entered by the TC is worth a read. (Note the amounts of income and deficiency. Not a pool cleaner. However, it occurs to me that the amounts determined by the IRS might have been gross receipts and did not reflect the costs of sales or other expenses, which means that this clown might have really hurt himself by not filing a return.)
Tax Court wrote:UNITED STATES TAX COURT
WASHINGTON, DC 20217
LESTER R . RAMER,
Petitioner
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent
Docket No. 11623-08
ORDER AND DECISION
On May 29, 2009, respondent's motion for summary judgment was filed. On June 2, 2009, this Court served upon petitioner a Notice of Filing, which gave petitioner until July 2, 2009, to submit "a notice of objection which sets forth the basis for the objection". On or about June 26, 2009, petitioner executed a document entitled "Ramer's Response to Comm'r's Motion for Summary Judgment" (petitioner's response), which bore an incorrect caption, and served it on respondent . Petitioner also sent it and several other, documents to this Court. The Court received the documents on June 30, 2009. However, the documents were not filed at that time because they did not comply with the Tax Court Rules of Practice and Procedure.
In a "Notice Setting Case For Trial", which was served on petitioner on October 22, 2009, this case was set for trial at the Little Rock, AR Trial Session beginning on March 22, 2010, (Marvel, J . presiding) . The unfiled documents were forwarded to the undersigned for appropriate action. By order dated October 26, 2009, the undersigned directed that most of the documents, including petitioner's response, be filed after the Court corrected the captions. The October 26, 2009, order also warned petitioner about the consequences of continuing to submit documents containing frivolous and groundless arguments and/or improper captions.
Respondent's motion for summary judgment requests summary adjudication in his favor under Rule 121, Tax Court Rules of Practice and Procedure. Rule 121 authorizes this Court to grant such a motion and render a decision "if the pleadings, answers to interrogatories, depositions, admissions, and any other acceptable materials, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that a decision may be rendered as a matter of law." Rule 121(d) also warns that "an adverse party may not rest upon the mere allegations or denials of such party's pleading, but such party's response, by affidavits or as otherwise provided in this Rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, then a decision, if appropriate, may be entered against such party."
Respondent's motion was made and supported as required by Rule 121. Petitioner was given an opportunity to respond to the motion and did submit a response. However, the response did not comply with Rule 121 in that the response did not set forth specific relevant facts showing that there is a genuine issue for trial, and petitioner did not submit affidavits under oath directed to the factual issues or any other materials that would support a conclusion that a trial is necessary. Petitioner's response is riddled with derogatory and inflammatory remarks about Court personnel, respondent, and the tax system, and demonstrates a complete disregard for the actual issues that this case presents. Petitioner's response makes it clear that he has no intention of addressing the issues on their merits either in the context of respondent's motion or at trial.
We turn then to respondent's motion, and we examine whether it contains sufficient information to support a conclusion that summary adjudication is appropriate. The relevant facts are as follows.
By notice of deficiency dated February 13, 2008, respondent determined an income tax deficiency of $328,190 and additions to tax under sections 6651(f), I.R.C., 6651(a)(2), I.R.C., and 6654, I.R.C, for the taxable year 2002. In the notice of deficiency, respondent determined the following : (1) Petitioner had taxable business income of $823,895 from Petra Stone for 2002, which respondent calculated by using the bank deposits method of reconstructing income; (2) petitioner was liable for self-employment tax of $32,592.74 and was entitled to a deduction of $16,297, representing one-half of the self-employment tax for 2002 ; (3) petitioner is entitled to a standard deduction of $3,925 for 2002 (assuming a filing status as a married taxpayer filing a separate return) ; (4) petitioner is liable for the section 6651(f), I.R.C., addition to tax because petitioner did not file a Federal income tax return for 2002 and his failure to file was fraudulent; (5) petitioner is liable for the section 6651(a)(2), I.R.C., addition to tax because he failed to pay the tax he owed for 2002 ; and (6) petitioner is liable for the section 6654, I.R.C., addition to tax because he did not make required estimated tax payments for 2002.
In response to the notice of deficiency, petitioner filed a lengthy petition that was rife with allegations that he did not have income or owe any income or self-employment tax, that he was not required to file a tax return because he had no income, and that he did not have a fiduciary duty to the United States of America. Respondent answered the petition, and in the answer he made affirmative allegations in support of his position that petitioner had substantial income for 2002 and that petitioner fraudulently failed to file a tax return for 2002.
On February 2, 2009, respondent filed a motion pursuant to Rule 37, Tax Court Rules of Practice and Procedure, that the affirmative allegations in his answer be deemed admitted. In a Notice of Filing of Motion for Order Under Rule 37, dated February 6, 2009, and served on petitioner February 9, 2009, the Court required petitioner to file a reply, as required by Rule 37(a) and (b), on or before March 2, 2009.
On or before February 13, 2009, petitioner mailed to the Court several documents that were not properly captioned. On March 2, 2009, the Court ordered that the documents be returned to petitioner and extended the deadline for petitioner to file his reply to March 20, 2009. Petitioner failed to submit a proper reply as required by the Court's order and Rule 37.
On March 26, 2009, the Court ordered that the affirmative allegations in respondent's answer be deemed admitted as required by Rule 37(c). The deemed admissions establish, among other facts, that (1) petitioner owned and operated a business conducted under the name of Petra Stone during 2002; (2) petitioner maintained bank accounts during 2002 into which he deposited $823,895, representing unexplained deposits that were not excludable income or nontaxable income; (3) petitioner established a sham trust to conceal his business income; (4) neither the trust nor petitioner filed a tax return for 2002; (5) petitioner has not filed an individual income tax return since 1996; (6) petitioner was extremely uncooperative during the 2002 audit; (7) petitioner actively espouses frivolous anti-tax positions; (8) petitioner failed to maintain or submit for examination by respondent complete and accurate books and records of his income-producing activities for 2002; (9) respondent determined petitioner's 2002 income using the bank deposits method of reconstructing income; (10) petitioner's failure to file a return and related actions were fraudulent with the intent to evade his 2002 Federal income tax liability; (11) petitioner did not pay any 2002 estimated tax payments or any part of his 2002 income tax liability; (12) petitioner has asserted frivolous and groundless positions in his petition and in several motions and documents submitted in this case. In addition, certified transcripts of petitioner's 2001 and 2002 tax accounts and a section 6020(b), I.R.C., certification that are attached to respondent's motion as exhibits demonstrate that petitioner was required to make but did not make estimated tax payments for 2002, that petitioner did not pay any part of his 2002 income tax liability, and that respondent prepared a substitute for return for 2002 under section 6020(b), I .R .C ., as a predicate for asserting the section 6651(a)(2), I .R .C ., addition to tax . See Wheeler v . Commissioner , 127 T .C . 200, 208-209 (2006), affd . 521 F .3d 1289 (10th Cir . 2008; Cabirac v . Commissioner , 120 T .C . 163, 170 (2003).
Petitioner has the burden of proving that respondent's determinations are in error, except that respondent must prove by clear and convincing evidence that petitioner's failure to file was fraudulent. See Rule 142, Tax Court Rules of Practice and Procedure, and sec. 6651(f), I.R.C. Petitioner has failed to submit any relevant information to demonstrate that there is a legitimate dispute about any relevant fact, that respondent is not entitled to a decision as a matter of law, or that petitioner is not liable for the income tax deficiency and the additions to tax determined in the notice of deficiency . In addition, by reason of the deemed admissions, respondent has satisfied his burden of proving that petitioner's failure to file a return for 2002 was fraudulent. See Brian M . DiMercurio v . Commissioner, T.C. Memo. 2009-225. We conclude, therefore, that respondent's motion for summary judgment should be granted and that decision should be entered accordingly.
Upon consideration of the above, it is hereby
ORDERED that respondent's motion for summary judgment, filed May 29, 2009, is granted. It is further
ORDERED and DECIDED that there is a deficiency in income tax due from petitioner for 2002 of $328,190. It is further
ORDERED and DECIDED that there is an addition to tax under section 6651(f), I.R.C., due from petitioner for 2002 of $237,937.75 ; that there is an addition to tax under section 6651(a)(2), I .R .C ., due from petitioner for 2002 of $ 82,047.50; and that there is an addition to tax under section 6654 , I .R .C ., due from petitioner for 2002 of $10,967.16.
(Signed) L . Paige Marvel
Judge
ENTERED: DEC 16 2009
