State Bar of Wisconsin Return to Wisconsin Tax Appeals Commission





P.O. Box 1775

LaCrosse, WI 54602,




P.O. Box 8933

Madison, WI 53708-8933,


DOCKET NO. 98-I-227



This matter came before the Commission for a trial on May 11, 1999, in Madison. At the close of the trial, respondent moved to dismiss the petition for review on the grounds that petitioner failed to answer questions under oath and that he failed to prosecute his case. Neither party submitted post-hearing briefs. Petitioner represented himself. Respondent was represented by Attorney Veronica Folstad.

Based upon the evidence presented at trial, the submissions of the parties, and the record in this matter, the Commission hereby finds, concludes, and orders as follows:


1. Petitioner did not file a proper Wisconsin income tax return for any of the years 1993 through 1996.

2. Under the date of December 29, 1997, respondent assessed petitioner $3,098.40 in additional income taxes for the years 1993 through 1996. Because petitioner did not file a proper Wisconsin income tax return for the years at issue, respondent estimated the amount of income petitioner earned during these years.

3. The assessment also included interest, fees, and a 25% negligence penalty for failing to file returns for the years at issue.

4. Petitioner filed a timely petition for redetermination objecting to the assessment. In the petition for redetermination, petitioner argued that while he was a resident of Wisconsin prior to 1993, he was not a Wisconsin resident during 1993, 1994, 1995, and the first eight months of 1996.

5. Respondent denied the petition for redetermination, and petitioner filed a timely petition for review with the Commission.

6. During each of the years at issue, petitioner had taxable income.

7. Petitioner failed to appear at two scheduling conferences that were held during this matter.

8. At trial, petitioner failed to answer questions put to him by respondent's attorney and by the Commission concerning his alleged change in residency. In fact, petitioner left the hearing room prior to the conclusion of the trial.


71.89 Appeal procedures.

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(2) No person against whom an assessment of income or franchise tax has been made shall be allowed in any action either as plaintiff or defendant or in any other proceeding to question such assessment ... unless such person shall have made full disclosure under oath at the hearing before the tax appeals commission of any and all income that the person received. The requirement of full disclosure under this subsection may be waived by the department of revenue.

73.01 Tax appeals commission.

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(am) Whenever it appears to the commission ... that the taxpayer's position in those proceedings is frivolous or groundless, the commission ... may assess the taxpayer an amount not to exceed $1,000 at the same time that the deficiency is assessed. Those damages shall be paid upon notice from the department of revenue and shall be collected as a part of the tax.


1. Petitioner failed to show that he abandoned his Wisconsin residency and established a domicile in another state at any time prior to or during the period under review, and, therefore, is liable for Wisconsin income taxes on his income.

2. Petitioner failed to establish that any portion of the assessment was incorrect.

3. Petitioner failed to make a full disclosure under oath before the Commission as required by section 71.89(2) of the Statutes.

4. Petitioner's position in this proceeding is frivolous and groundless.


This case presents three issues for resolution: (1) Did petitioner prove that any portion of respondent's assessment is incorrect? (2) Should petitioner be sanctioned for failing to answer questions under oath at trial as required by section 71.89(2)? (3) Should petitioner be sanctioned because his position in this proceeding is frivolous or groundless?

Respondent's Assessment

Petitioner's primary challenge to respondent's assessment is that he was not a resident of Wisconsin during most of the period at issue. In order to prevail on such an argument, petitioner has the "the burden of proof to establish by competent and clear, convincing and satisfactory evidence that he had in reality actually abandoned his domicile in Wisconsin and that he had actually by permanent occupancy established a new domicile" in another state or jurisdiction. Baker v. Dep't of Taxation, 246 Wis. 611, 618 (1945).

Petitioner did not attempt to meet this burden. Not only did petitioner fail to offer documentary evidence showing he established a domicile elsewhere (e.g., through a change of financial depository, leases, change in driver's license or vehicle registration), he also refused to answer questions seeking the state to which he allegedly moved.

Petitioner also claimed that he filed a tax return for that portion of 1996 during which petitioner concedes he was a Wisconsin resident. Respondent denies this contention. Aside from a statement under oath, petitioner provided no evidence to support his contention. The Commission does not find petitioner's assertion credible.

Petitioner admitted that he had income during each of the years at issue, although he claimed this was earned in another state. Petitioner failed to provide any evidence as to the amount of this income or as to its situs. As a result, the Commission has no choice but to sustain respondent's action on the petition for redetermination.

Failure to Make Disclosure Under Oath

Section 71.89(2) required petitioner to submit to questions concerning his income under oath at the hearing. Petitioner failed to do so, even after being warned that he could be sanctioned for this failure. At the end of the hearing, respondent moved to dismiss the petition for review on the basis that petitioner violated section 71.89(2).(1)

While it is clear that petitioner failed to meet his burden to show that the assessment is incorrect, it is worth noting that petitioner could have been sanctioned for failure to answer questions under oath at trial. Under these facts, it would be appropriate to dismiss the petition for review.

Frivolous or Groundless Position

Petitioner's position is both frivolous and groundless. Based on his comments at trial and the content of his written submissions, petitioner was competent to present a challenge to respondent's action if there were facts or law to support such a challenge.

Because petitioner presented absolutely no evidence to support his position and refused to reveal the state to which he allegedly changed his residency, we can only conclude that such evidence does not exist and never did. Therefore, we conclude that petitioner's position in this matter is frivolous and groundless.

We conclude that the appropriate sanction under section 73.01(4)(am) is $750.



That respondent's action on the petition for redetermination is affirmed, and petitioner is assessed an additional $750 pursuant to section 73.01(4)(am).

Dated at Madison, Wisconsin, this 17th day of May, 1999.


Mark E. Musolf, Chairperson

Don M. Millis, Commissioner

Thomas M. Boykoff, Commissioner


1 Respondent also moved to dismiss the petition for review on the basis that petitioner failed to prosecute his case. We choose not to address this motion.