Opinion
12103-20
07-13-2022
CHADD FOX, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Albert G. Lauber, Judge.
With respect to petitioner's 2017 tax year, the Internal Revenue Service (IRS or respondent) determined a deficiency of $93,609 and an accuracy-related penalty of $18,722. The deficiency results from respondent's determination that petitioner had failed to substantiate expense deductions and credits. Petitioner bears the burden of proving his entitlement to these items. See Tax Court Rule 142(a); Treas. Reg. § 1.6001-1(a) (requiring taxpayers to keep books or records to substantiate claimed deductions).
Petitioner timely petitioned this Court in October 2020, and the case was originally calendared on the Court's June 14, 2021, Denver, Colorado, trial session. On April 7, 2021, petitioner moved for a continuance, to which respondent did not object. We granted that motion and calendared this case for remote trial on February 7, 2022, set for administrative purposes in Denver, Colorado.
On January 7, 2022, petitioner filed another motion for continuance. His counsel represented that, due to health issues and financial difficulties, petitioner "has been unable to participate in trial preparation." Later the same day respondent filed a notice of objection to petitioner's motion. Respondent stated that he did not oppose a continuance; however, he noted that this case had already been continued once and represented that petitioner had yet to provide any documentation to substantiate his claimed deductions and credits.
On January 11, 2022, we granted petitioner's motion for continuance, but retained jurisdiction to monitor the parties' progress. We directed petitioner to supply to respondent's counsel, by March 14, 2022, all documents on which he would expect to rely at trial. On March 31, 2022, respondent filed a status report representing that petitioner had not submitted any documentation by March 14 or subsequently. On April 1, 2022, petitioner's counsel filed a status report asserting that petitioner's illness prevented him from producing documents and that it would not "be productive in moving this case forward to order document disclosure . . . [until] petitioner is well enough to gather documents and assist counsel in the preparation of this case."
On April 4, 2022, we issued an order directing petitioner to provide to respondent's counsel, by June 20, 2022, all documents on which he expected to rely as support for his claimed deductions and credits. Petitioner was advised that, absent extraordinary circumstances, he would not be permitted to use at trial any documents not supplied to respondent by that date. On July 8, 2022, respondent filed a status report representing that petitioner had not submitted any documentation by June 20, 2022, or subsequently.
This case has been pending for nearly two years. Petitioner has repeatedly declined to address the sole issues in this case-substantiation of his claimed deductions and credits. Because of petitioner's health condition, we will give him one final chance to provide documents to respondent's counsel. We warn petitioner that, if he fails to comply with this Order, we will entertain a motion from respondent to dismiss this case for lack of proper prosecution. See Tax Court Rule 123(b).
In consideration of the foregoing, it is
ORDERED that petitioner shall submit to respondent's counsel, by August 26, 2022, all documents on which he would expect to rely at trial in support of his position. Absent extraordinary circumstances, petitioner will not be permitted to use at trial any documents not supplied to respondent's counsel by this deadline. It is further
ORDERED that respondent shall file with this Court, on or before September 6, 2022, a status report detailing the then-present status of the case.