At trial, the Court warned petitioner on numerous occasions that the arguments he was making have been deemed frivolous by the Court and it has imposed penalties under section 6673 against taxpayers who raise such arguments. Despite the Court's warnings, petitioner continued with the frivolous and groundless arguments at trial.

OPINION

Throughout this case, petitioner presented tax-protester arguments to assert he was not liable for Federal income 2007 Tax Ct. Memo LEXIS 208">*215 tax deficiencies as determined in the notices of deficiency for the years at issue, including: (1) He is not a taxpayer; (2) respondent has no jurisdiction over him; (3) his wages did not constitute gross income; and (4) respondent lacks authority to assert income tax deficiencies. Petitioner's assertions have been rejected by this Court and other courts, and "We perceive no need to refute these arguments with somber reasoning and copious citation of precedent; to do so might suggest that these arguments have some colorable merit." Crain v. Commissioner, 737 F.2d 1417">737 F.2d 1417, 737 F.2d 1417">1417 (5th Cir. 1984); see Stelly v. Commissioner, 761 F.2d 1113">761 F.2d 1113, 761 F.2d 1113">1115 (5th Cir. 1985) ("It is clear beyond peradventure that the income tax on wages is constitutional"); United States v. Romero, 640 F.2d 1014">640 F.2d 1014, 640 F.2d 1014">1016 (9th Cir. 1981) (compensation for labor or services, paid in the form of wages or salary, has been universally held by the courts of this republic to be income, subject to the income tax laws currently applicable); Wetzel v. Comm'r, T.C. Memo 2005-211 (rejecting as frivolous the argument that the taxpayer was not a taxpayer); Nunn v. Comm'r, T.C. Memo 2002-250 (rejecting as without merit the 2007 Tax Ct. Memo LEXIS 208">*216 argument that the Commissioner had no jurisdiction over the taxpayer or his documents). The Court rejects petitioner's tax-protester arguments as frivolous and without merit.

Section 61(a) defines gross income for purposes of calculating taxable income as "all income from whatever source derived". Section 1 imposes a tax on individuals for taxable income received. The liability for the payment of the income tax is on the individual earning the income. Lucas v. Earl, 281 U.S. 111">281 U.S. 111, 281 U.S. 111">114-115, 50 S. Ct. 241">50 S. Ct. 241, 74 L. Ed. 731">74 L. Ed. 731 (1930).

Respondent determined that in the years at issue petitioner received and failed to report gross income in the form of wages, capital gains, and distributions from qualified retirement plans. Respondent also determined petitioner failed to file Federal income tax returns for the years at issue and make estimated tax payments, other than the tax withheld.

Generally, the taxpayer has the burden of proving the Commissioner's determinations are in error. Rule 142(a). The Court of Appeals for the Fifth Circuit, the Circuit in which appeal in this case would lie, has held that in unreported income cases "The Commissioner has no duty to investigate a third-party payment report that is not disputed by 2007 Tax Ct. Memo LEXIS 208">*217 the taxpayer." Parker v. Commissioner, 117 F.3d 785">117 F.3d 785, 117 F.3d 785">787 (5th Cir. 1997); Andrews v. Commissioner, T.C. Memo. 1998-316. Generally, a third-party payment report is not in dispute unless the taxpayer files a Form 1040 or other sworn document denying receipt of unreported income. 117 F.3d 785">Parker v. Commissioner, supra at 787; Spurlock v. Comm'r, T.C. Memo 2003-248; Andrews v. Commissioner, supra.

Petitioner received from third-party payors: (1) In 2000, wage income of $ 12,733, $ 10,595, $ 44,250, $ 14,271, and $ 9,279, from Metro Information Services, Ajilon LLC, MBNA, SCB Computer Technology, Inc., and CCC, Inc., respectively, capital gain income of $ 412 and $ 164 from AXP and American Express, respectively, and a taxable distribution of $ 295 from Federal Savings Bank; (2) in 2001, wage income of $ 99,949 from MBNA and capital gain income of $ 73 from AXP; (3) in 2002, wage income of $ 99,771 from MBNA Technology, Inc., capital gain income of $ 456 from MBNA Corp., and a taxable distribution of $ 4,449 from MBNA Corp. 401K; and (4) in 2003, wage income of $ 109,395 from MBNA Technology and a taxable distribution of $ 4,687 from MBNA Corp. 401K.

Although petitioner disputed receiving $ 2007 Tax Ct. Memo LEXIS 208">*218 4,716 from Texas Temp, the Court finds that petitioner's testimony is not credible. Moreover, petitioner failed to cooperate with respondent in the preparation of this case. See sec. 6201(d). For the foregoing reasons, the Court finds petitioner received $ 4,716 of wage income from Texas Temp in 2000.

Respondent also determined that the taxable distributions petitioner received from the Federal Savings Bank in 2000 of $ 295 and from the MBNA Corp. 401K in 2002 and 2003 of $ 4,449 and $ 4,687, respectively, were early distributions from qualified retirement plans pursuant to section 72(t)(1). As a result, petitioner was liable for the 10-percent additional tax on the distributions he received from these plans. Petitioner does not dispute that the distributions were from qualified retirement plans pursuant to section 72(t). Petitioner also does not argue, and the record is devoid of any evidence which would indicate, that he is qualified for any exception to section 72(t). For the foregoing reasons, the Court finds that petitioner is liable for the 10-percent additional tax on the early distributions from his qualified retirement plans in 2000, 2002, and 2003.

1. Burdens 2007 Tax Ct. Memo LEXIS 208">*219 of Production and Proof

Respondent bears the burden of production with respect to petitioner's liability for the additions to tax. See sec. 7491(c); Higbee v. Comm'r, 116 T.C. 438">116 T.C. 438, 116 T.C. 438">446-447 (2001). To meet his burden of production, respondent must come forward with sufficient evidence indicating it is appropriate to impose the additions to tax. See 116 T.C. 438">Higbee v. Comm'r, supra at 446-447. Once respondent meets his burden of production, petitioner must come forward with evidence sufficient to persuade the Court that respondent's determinations are incorrect.

2. Section 6651(a)(1)

Respondent determined that petitioner is liable for additions to tax under section 6651(a)(1) for the years at issue. Section 6651(a)(1) imposes an addition to tax for failure to file a return on the date prescribed (determined with regard to any extension of time for filing), unless the taxpayer can establish that such failure is due to reasonable cause and not willful neglect. Petitioner is deemed to have stipulated that he failed to file Federal income tax returns for the years at issue. The Court finds respondent has met his burden of production with regard to the additions to tax under section 6651(a)(1).

Petitioner 2007 Tax Ct. Memo LEXIS 208">*220 has presented no evidence indicating his failure to file was due to reasonable cause or that respondent's determination is otherwise incorrect. Accordingly, the Court finds petitioner is liable for additions to tax under section 6651(a)(1) for the years at issue.

3. Section 6654(a)

Respondent determined that petitioner is liable for additions to tax under section 6654(a) for failure to make estimated tax payments for the years at issue. A taxpayer has an obligation to pay estimated tax for a particular year only if he has a "required annual payment" for that year. Sec. 6654(d). A "required annual payment" is equal to the lesser of (1) 90 percent of the tax shown on the individual's return for that year (or, if no return is filed, 90 percent of his or her tax for such year), or (2) if the individual filed a return for the immediately preceding taxable year, 100 percent of the tax shown on that return. Sec. 6654(d)(1)(A), (B), and (C); Wheeler v. Comm'r, 127 T.C. 200">127 T.C. 200, 127 T.C. 200">210-212 (2006); Heers v. Comm'r, T.C. Memo 2007-10.

Respondent introduced evidence to prove petitioner was required to file Federal income tax returns for the years at issue. Petitioner failed to file returns 2007 Tax Ct. Memo LEXIS 208">*221 for the years at issue, and petitioner failed to make any estimated tax payments for the years at issue, other than the amounts withheld. Petitioner also failed to file a Federal income tax return for 1999. ⁵ See Rhodes v. Comm'r, T.C. Memo 2003-133, affd. 152 Fed. Appx. 340">152 Fed. Appx. 340 (5th Cir. 2005). Thus, the Court finds that respondent has met his burden of production with regard to the additions to tax under section 6654(a). Petitioner offered no evidence to refute respondent's evidence or to establish a defense to respondent's determination that petitioner is liable for the section 6654 additions to tax. Therefore, the Court finds petitioner is liable for additions to tax under section 6654 for the years at issue.

Section 6673(a)(1) authorizes the Court to require a taxpayer to pay the United States a penalty in an amount not to exceed $ 25,000 whenever the taxpayer's position is frivolous or groundless or the taxpayer has instituted or pursued the proceeding primarily for delay. Respondent has not asked the Court to impose a penalty under section 6673(a)2007 Tax Ct. Memo LEXIS 208">*222 against petitioner. However, the Court may, sua sponte, impose this penalty. Pierson v. Commissioner, 115 T.C. 576">115 T.C. 576, 115 T.C. 576">580 (2000); Rewerts v. Comm'r, T.C. Memo 2004-248; Jensen v. Comm'r, T.C. Memo 2004-120.

In Rhodes v. Comm'r, T.C. Memo 2003-133, the Tax Court imposed a penalty of $ 2,000 on petitioner pursuant to section 6673(a)(1) because petitioner had advanced frivolous arguments. Before trial in the instant case, the Court warned petitioner on seven occasions that it would impose a penalty under section 6673(a)(1) if he continued to advance frivolous arguments. At trial, the Court also warned petitioner on numerous occasions that if he continued to advance frivolous arguments, it would impose a penalty under section 6673(a)(1).

Despite the warnings of the Court, petitioner continued to assert groundless arguments. Under the circumstances, the Court will, on its own motion, impose a penalty of $ 15,000 on petitioner pursuant to section 6673(a)(1).

In reaching our holdings, we have considered all arguments made, and, to the extent not mentioned, we conclude that they are moot, irrelevant, or without merit.

To reflect the foregoing,

Decision will be entered under Rule 155.