Winslow v. Commissioner
2012 U.S. Tax Ct. LEXIS 33
Tax Ct.2012Background
- Winslow failed to file 2005 and 2006 returns; IRS prepared substitutes for returns and issued deficiencies and penalties.
- Ms. Green, Operations Manager, examined and certified substitutes for returns; she supervised SB/SE officers with delegated authority.
- Mr. Slaughter, Director, Collection Area-Western, signed and issued notices of deficiency under delegation.
- Intervening line supervisors (up to the Commissioner) have the same delegated authority as subordinates.
- Court sustains deficiencies and the additions to tax under §§ 6651(a)(1) and (a)(2); sanction under § 6673(a)(1) imposed.
- Court emphasizes that substitutes for returns are not prerequisite to determining a deficiency, but may be used for calculating pay penalties.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether delegation authorized substitutes for returns and notices of deficiency | Winslow argues Green/Slaughter lacked delegated authority | R shows proper delegation through IRM Delegation Orders and intervening supervisors | Yes; authority properly delegated |
| Are the § 6651(a)(1) and § 6651(a)(2) additions appropriate | Winslow contests due to improper handling of returns | Respondent proves nonfiled/nonpayment; additions proper | Yes for both additions |
| Whether § 6673(a)(1) penalty is warranted | Winslow argues frivolousness not shown | Petitioner's positions were frivolous and delay-causing | Imposed $2,500 penalty |
Key Cases Cited
- Crain v. Commissioner, 737 F.2d 1417 (5th Cir. 1984) (addresses frivolous arguments and taxability)
- Wnuck v. Commissioner, 136 T.C. 498 (2011) (taxable income and filing requirements)
- Fargo v. Commissioner, 447 F.3d 706 (9th Cir. 2006) (IRM interpretations and delegation authority)
- Vallone v. Commissioner, 88 T.C. 794 (1987) (delegation authority and Secretary definition)
- Higbee v. Commissioner, 116 T.C. 438 (2001) (burden of proof on Commissioner for additions to tax)
- Takaba v. Commissioner, 119 T.C. 285 (2002) (frivolous positions and need to conform conduct)
- Goff v. Commissioner, 135 T.C. 231 (2010) (frivolous positions defined; standard for sanctions)