Benton Williams, Jr. v. Commissioner, 151 T.C. 1

Petitioner Benton Williams Jr. received $43,396 in wages, $7,200 in unemployment compensation, and a $7,890 retirement distribution in 2012 and did not file a federal return for that year.
IRS prepared a substitute for return (SFR) under I.R.C. §6020(b) and issued a notice of deficiency for 2012. Petitioner timely petitioned the Tax Court.
Petitioner repeatedly advanced tax-protester arguments in his petition, pretrial filings, at trial, and in briefing; the Court and respondent warned him those arguments were frivolous.
Respondent sought (and the Court considered) deficiencies, additions to tax under I.R.C. §6651(a)(1) and (2), a 10% additional tax under I.R.C. §72(t), and a sanction under I.R.C. §6673(a)(1).
The Court held petitioner had the stipulated unreported income, upheld the §72(t) tax on the early retirement distribution, sustained both §6651 additions to tax, and imposed a $2,000 §6673(a)(1) penalty.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether $43,396 wages and $7,200 unemployment are taxable income	Williams argued (tax‑protester) that the income was not taxable	Commissioner relied on stipulations and §61 to include the amounts in gross income	Court sustained inclusion of the wages and unemployment as taxable income
Whether $7,890 retirement distribution is taxable and subject to §72(t)	Williams did not show exceptions or that he was over 59½; argued generally that code didn’t apply	Commissioner treated distribution as from a qualified plan and asserted 10% early‑distribution tax	Court sustained inclusion and imposed 10% additional tax under §72(t)
Whether additions to tax under §6651(a)(1) (failure to file) apply	Williams claimed no filing obligation (frivolous)	Commissioner showed petitioner failed to file and met burden to invoke additions; SFR treated as return for §6651(a)(2)	Court sustained additions under §6651(a)(1) and §6651(a)(2); petitioner offered no reasonable‑cause defense
Whether §6751(b)(1) supervisory approval is required before Court imposes §6673(a)(1) penalty	Williams argued broadly against Court’s authority via tax‑protester theories	Commissioner moved for §6673(a)(1) sanction; respondent relied on Court’s authority to penalize frivolous litigation	Court held §6751(b)(1) does not limit Tax Court’s independent discretion to impose §6673(a)(1) penalties and imposed $2,000 sanction

Wnuck v. Commissioner, 136 T.C. 498 (2011) (rejecting common tax‑protester arguments about non‑taxability of wages)
Wheeler v. Commissioner, 127 T.C. 200 (2006) (same; Tax Court’s treatment of protester positions)
Crain v. Commissioner, 737 F.2d 1417 (5th Cir. 1984) (court cautions against treating frivolous arguments with extensive analysis)
Chai v. Commissioner, 851 F.3d 190 (2d Cir. 2017) (discussing §6751(b)(1) supervisory‑approval requirement for IRS penalty determinations)
Radzanower v. Touche Ross & Co., 426 U.S. 148 (1976) (statutory‑construction canon: specific statutes control over general ones)