TP Finds No Sympathy In The Tenth

[The Observer]

STEVEN R. RADER,
Petitioner-Appellant,
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent-Appellee.

VIVIAN L. RADER,
Petitioner-Appellant,
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent-Appellee.

Release Date: OCTOBER 14, 2015

UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT

(Tax Ct. Nos. 11476-11 & 27722-11)
(Petition for Review)

(Tax Ct. No. 11409-11)
(Petition for Review)

ORDER AND JUDGMENT/*/

Before KELLY, BALDOCK, and GORSUCH, Circuit Judges.

Steven Rader came to the Internal Revenue Service's attention after he purchased materials from a well-known tax protestor who was in the business of deliberately evading the tax laws and helping others do the same. In the end, the United States Tax Court determined that Mr. Rader was liable for unpaid taxes and penalties of nearly a million dollars.

Mr. Rader's spouse, Vivian, seeks to appeal this result. But the Tax Court did not find any liability on her part. Neither is there any evidence in this record, as she asserts, suggesting that the judgment against Mr. Rader created clouds on titles to properties the Raders sold many years ago. Despite being challenged to do so in this appeal, then, Ms. Rader has not identified any personal and direct injury she suffered from the judgment below. And without that she lacks standing to appeal. United States v. Ramos, 695 F.3d 1035, 1046 (10th Cir. 2012).

To be sure, Mr. Rader also seeks to overturn the Tax Court's decision and he has standing to do so. But even construing his pro se complaint liberally and reviewing the Tax Court's application of law de novo and its findings of facts for clear error, we can find no fault with the Tax Court's disposition. See Mitchell v. Comm'r, 775 F.3d 1243, 1246 (10th Cir. 2015). For example, Mr. Rader contends that the substitute returns the Commissioner rendered in place of his own were defective. But Mr. Rader has failed to show how the returns were invalid under 26 U.S.C. section 6020, which specifies when and how the IRS may prepare substitute returns. Mr. Rader argues he was entitled to a credit for money withheld and remitted to the IRS from the proceeds of real estate sales. But we can find no flaw in the Tax Court's analysis explaining why the money withheld may not be credited under 26 U.S.C. section 6211(b)(1). Mr. Rader seems to take issue with several of the Tax Court's evidentiary rulings, including in response to his Fifth Amendment objection. But he offers few record citations that might allow this court to identify and consider his complaints in a meaningful way and, beyond that, he offers only conclusory arguments that are themselves insufficient to facilitate review by this court. See, e.g., United States ex rel. Boothe v. Sun Healthcare Grp., Inc., 496 F.3d 1169, 1175(10th Cir. 2007). Finally, Mr. Rader has forfeited his argument that the Notice of Deficiency was itself defective, for he failed to raise this argument in the Tax Court in the first instance. See Mitchell, 775 F.3d at 1248 n.3.

Beyond his challenge to the merits of the Tax Court's disposition, Mr. Rader challenges its decision to sanction him under 26 U.S.C. section 6673(a)(1). But here again Mr. Rader fails to offer this court any reasoned ground on which it might hold the Tax Court abused its discretion when determining that his arguments on the merits were largely frivolous.

Ms. Rader's appeal (15-9001) is dismissed for lack of jurisdiction. The judgment against Mr. Rader (15-9000) is affirmed.

Entered for the Court

Neil M. Gorsuch
Circuit Judge

//*//

After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist in the determination of these appeals. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The cases are therefore ordered submitted without oral argument. This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.

[Burnaby49]

And for once the decision was short. I find, in general, that American tax decisions are way too long.

[Jeffrey]

a well-known tax protestor who was in the business of deliberately evading the tax laws and helping others do the same

Name names.

[The Observer]

Name names.

I am guessing it is either Irwin Schiff or Famspear's favorite, falsifying, fabulous felon, Pete Hendrickson.

[LPC]

a well-known tax protestor who was in the business of deliberately evading the tax laws and helping others do the same

Name names.

The 10th Circuit was reviewing and affirming a published Tax Court decision, Vivian L. Rader et al. v. Commissioner, 14 T.C. No. 19 (2014).

The opinion addresses some interesting technical issues regarding the scope of "deficiency," and some 5th Amendment claims, but there is (unfortunately) nothing in the TC opinion to suggest who the "well-known tax protestor" might be. The 5th Amendment claim suggests William Benson, but the "nothing he has read in his research of the law states he is required to file a return" could be almost anyone.

Worth noting that the Tax Court imposed $10,000 in sanctions sua sponte.

[jcolvin2]

Rader returns to Tax Court with respect to a later year, espousing the same positions. Curiously, the same result is obtained - deficiency upheld plus FtF, FtP, estimated tax penalty, and section 6673 penalty (only $2k):

https://www.ustaxcourt.gov/UstcInOp/Opi ... x?ID=11457

From the opinion:

IV. Frivolous Position Penalty
Section 6673(a)(1) authorizes this Court to impose on the taxpayer a penalty payable to the United States and not in excess of $25,000 whenever it appears that

(1) the taxpayer has instituted or maintained proceedings primarily for delay;

(2) the taxpayer’s position in such proceedings is frivolous or groundless; or

(3) the taxpayer unreasonably failed to pursue available administrative remedies.

At the commencement of the trial respondent raised the possibility of moving for imposition of this penalty, but he has not so moved, presumably because leading up to and throughout the trial petitioner was not uncooperative.

Petitioner, however, has been sanctioned before (in 2014 and 2016) under section 6673(a) by this Court sua sponte or at the request of the Commissioner in other cases in which he has been involved for, among other things, espousing positions identical to or very similar to the ones he advances on brief in this case. See Rader v. Commissioner, 143 T.C. at 392-393 (imposing on petitioner a section 6673(a)(1) penalty of $10,000); Rader v. Commissioner, T.C. Dkt. No. 2340-16 (May 31, 2016) (order imposing on petitioner a section 6673(a)(1) penalty of $2,500). In view of the foregoing and the fact that having to deal with this matter wasted not only the Court’s time but respondent’s as well, we will require [*13] petitioner to pay to the United States a penalty under section 6673(a)(1) of $2,000.7

7 We recognize that this amount is less than the prior sec. 6673(a)(1) penalties the Court has imposed on petitioner but note that, unlike in petitioner’s prior cases, respondent did not move for the Court to impose a sec. 6673(a)(1) penalty and the Court did not find it necessary to warn petitioner during or at the conclusion of the trial that we might impose such a penalty. Petitioner is on notice
that if he persists in espousing frivolous positions in future cases, he will be subject to greater sanctions under sec. 6673(a)(1).