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Adopted November 2, 2000
CALIFORNIA STATE BOARD OF EQUALIZATION
PERSONAL INCOME TAX APPEAL
Proposed Assessment Appellant Year Tax Penalties
Guy Blackwell 1996 $2,513.00 $502.60 (accuracy) 1Case
No. 29258 628.25 (demand)
Representing the Parties:
For Appellant: Guy Blackwell For Franchise Tax
Board: Andrew O'Boyle, Staff ServicenManager
Counsel For Board of Equalization: Donald L.
Fillman, Tax Counsel
QUESTIONS: (1) Whether appellant's California
income is subject to California's tax laws.
2) Whether respondent properly estimated appellant's
net income and tax liability.
(3) Whether appellant has maintained a
frivolous or groundless position before this
FINDINGS AND DETERMINATION
 On February 25, 1997, respondent received a Form 540 that appellant declared
was a valid return for 1996. However, it had zeroes on the lines for Federal
adjusted gross income, California adjusted gross income, and taxable income.
The lines for state wages and total tax were blank. It showed $107 as income
withheld, and claimed a refund of $107. As a part of appellant's submittal was
a two-page typewritten statement that had blanks to be filled-in. It was a form-type
statement alleging that there was no section of the Internal Revenue Code that
establishes an income tax liability and other similar allegations. It was addressed
to the Internal Revenue Service (IRS) but had been adjusted slightly for appellant's
state submittal. Also provided were three Form W-2 reports and a Form 1099- R
 Respondent did not accept appellant's Form 540 as a
valid return. On September 16, 1998, respondent mailed a
written notice that notified appellant of penalties that
could be assessed, as well as a demand to appellant to file
(within 30 days) a 1996 return. There was no response. On
March 30, 1999, respondent issued a Notice of Proposed Assessment
(NPA) that estimated appellant's taxable income from available
information. It calculated additional tax of $2,513.00, an
accuracy related penalty of $502.60 (20 percent of the underpaid
tax), and a notice and demand penalty of $628.25 (25 percent
of the total tax prior to credits). Appellant filed an undated
protest that included a request for an oral hearing. It also
included a list of contentions including: the notice and
demand was not valid; and, appellant had not received income
from various political entities (such as the United States,
a state, or a foreign government) or income of specified
types (such as real estate transactions and unemployment
compensation). As requested, respondent scheduled an oral
hearing, but appellant failed to appear without notice. Respondent
issued a Notice of Action (NOA) dated July 26, 1999, which
affirmed the NPA. Appellant's appeal was received by the
Board on August 10, 1999.
 Appellant's brief, received on November 19, 1999, contends,
on page 1, that appellant was not given due process including "a
protest hearing consistent with due process." Appellant
contends that: (1) the notice and demand was not valid because
it was issued by the wrong subdivision of respondent; (2)
appellant had reasonable cause for ignoring the notice and
demand because it was invalid; (3) respondent's proposed
assessment was invalid because it was arbitrary, capricious,
and without foundation (including the allegations that forms
W-2 and 1099 may only report income from certain sources
not applicable to appellant; "a resident, for purposes
of income taxation and withholding, is a government employee
. receiving income from a government source"); and,
(4) appellant should not be penalized for refusing to acknowledge
a tax debt under penalty of perjury.
 Revenue and Taxation Code (R&TC) section 19087 provides
that if a taxpayer fails to file a return, or files a false
or fraudulent return with intent to evade the tax, respondent
may make an estimate of the net income from any available
information. When a taxpayer fails to file a proper return
and refuses to provide information requested, he or she is
not in a good position to criticize respondent's proposed
assessment. (Appeals of Fred R. Dauberger, et al., Cal. St.
Bd. of Equal., Mar. 31, 1982.)
 Appellant's contentions do not attempt to dispute the
correctness of the amounts contained in the NOA. Rather,
appellant's contentions are the same type as those heard
and uniformly rejected by this Board on numerous occasions,
and which both California and United States courts have rejected
for many years (see: Appeal of Alfons Castillo, 92-SBE-020,
July 20, 1992; Appeal of Walter R. Bailey, 92-SBE-001, Feb.
20, 1992; Appeals of Fred R. Dauberger, et al., supra), a
fact pointed out to appellant in the NOA issued on July 26,
1999. Respondent's determination is presumed correct and
appellant bears the burden of proving that it is erroneous.
(Todd v. McColgan (1949) 89 Cal.App.2d 509.) When a taxpayer
fails to present credible, competent, relevant, and uncontradicted
evidence as to the issues in dispute, respondent's determination
cannot be successfully rebutted. (Appeal of James C. and
Monablanche A. Walshe, Cal. St. Bd. of Equal., Oct. 20, 1975.)
Appellant has failed to meet this burden.
 Revenue and Taxation Code section 19714 provides for
a penalty of up to $5,000 for maintaining a frivolous or
groundless position before this Board. As indicated above,
appellant was notified of this in the NOA. Yet appellant
filed and has maintained the present appeal without identifying
any legitimate grounds upon which respondent's action may
be challenged. We conclude that a frivolous appeal penalty
should be imposed against appellant in the amount of $750.
 The action of respondent is sustained, subject to the
adjustments stated in footnote 1. In addition, a frivolous
or groundless appeal penalty, pursuant to section 19714,
is imposed in the amount of $750.
1 Respondent stated that it determined that the
accuracy penalty should be withdrawn and a credit given for
$107 of state income taxes withheld.
END OF FOOTNOTE
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