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Harriss v. Commissioner (T.C. Memo. 2021-31)

On March 11, 2021, the Tax Court issued a Memorandum Opinion in the case of Harriss v. Commissioner (T.C. Memo. 2021-31). The primary issues presented in Harriss were whether the notices of deficiency issued to the petitioners were valid and whether the petitioner is liable under IRC § 72(t) for the early withdrawal penalty.


The petitioner was paid, on average, $150,000 in 2012, 2013, and 2014.  Forms 1099 were issued.  Taxes were withheld. In 2013, the petitioner withdrew $37,000 from his retirement plan.  Nonetheless, the petitioner filed (untimely) his returns claiming ZERO income (wages) and claiming a refund for the entirety of the withheld taxes.  Accompanying said returns were “corrected” Forms W-2 and 1099, accompanying was a statement which read the following:

My activities in 2012 involved entirely private arrangements and did not involve the exercise of any federal privilege or the receipt of any federally-connected gain or benefit.

Having just gone through this frivolousness rodeo in Smith v. Commissioner, T.C. Memo. 2021-29, we won’t get too far into the weeds on this argument.

What the Actual Hell?

Crazy HarrissThe petitioner, while residing in Alaska, timely filed petitions, which were subsequently consolidated and set for trial. About two weeks before the scheduled trial date petitioner filed a motion to dismiss these cases, arguing lack of jurisdiction. The Tax Court (a bit befuddled) held a hearing on petitioner’s motion to dismiss in conjunction with the previously scheduled trial. Petitioner chose not to testify at the trial, pleading the Fifth Amendment in response to respondent’s questions.

So, to recap, the petitioner invoked the jurisdiction of the Tax Court, and then argued that it did not have jurisdiction, and then when question on why he did what he did, refused to incriminate himself on the basis that doing so might subject him to criminal liability.  That’s next level crazy right there.

Who May Sign Notices of Deficiency?

The IRS. IRC § 6212. It’s that simple. Id.

Just Spank the Kid Already

Spank HarrissAt various points in these proceedings petitioner “raised frivolous and groundless arguments similar or identical to those that he raised–and that this Court and the Court of Appeals for the Ninth Circuit rejected in a previous case relating to his 2010 and 2011 taxable years.” Harriss v. Commissioner, T.C. Memo. 2017-5, aff’d, 776 F. App’x 425 (9th Cir. 2019). In that earlier case the Tax Court Court cautioned petitioner that if he continued to advance frivolous or groundless arguments, he “might incur” substantial penalties under IRC § 6673(a). Id. at *15. “We renew that warning today.”


That “warning” is really getting the job done.  Telling little Billy that he won’t get his cake if he continues to act like demon spawn is about as useful as warning a petitioner who is 9/10 of the way down the road to Crazytown that he better turn back, or he “might” be punished.

Fish, or cut bait.  If you are going to sanction the idiot, just do so.  I’ll look forward to the 2022 opinion where the Tax Court “re-renews” its warning…

(T.C. Memo. 2021-31) Harriss v. Commissioner

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