State Bar of Wisconsin Return to Wisconsin Tax Appeals Commission








10535 N. Mudhen Lake Road

Siren, WI 54872-8528,




P.O. Box 8907

Madison, WI 53708-8907,


DOCKET NO. 02-I-10



These cases come before the Commission on motions of the respondent ("Department") and of petitioners. The Department moves (1) for summary judgment pursuant to Wis. Stat. § 802.08, and (2) for costs under §§ 73.01(4)(am) and 814.025. Petitioners move (1) for summary judgment under § 802.01(2), and (2) for $100 of redress pursuant to § 814.02(2) for the Department's actions leading to their appeals.

Petitioners represent themselves. Attorney Kenneth J. Artis represents the Department.

The motions were accompanied by affidavits and exhibits. The parties also submitted legal arguments as to why their motions should be granted and why the opposing motions should be denied.

Having considered the entire record, the Commission hereby finds, rules, and orders as follows:


Docket No. 02-I-07-SC

1. Under date of March 26, 2001, Mr. Stewart filed a 2000 Wisconsin income tax Form 1 with the Department. Attached was a Form W-2 issued to him by Parker Hannifin Corporation, Cleveland, Ohio, reflecting "Wages, tips, other comp." of $43,711.58 and Wisconsin income tax withheld of $2,667.29. On most lines of the income tax form, Mr. Stewart wrote "0.00." However, on line 38, he wrote that "2,667.00" of Wisconsin income tax was withheld, and on line 47, he requested that the entire amount be refunded to him.

2. Under date of July 2, 2001, the Department issued to Mr. Stewart an assessment for $57.80, comprised of income tax and interest, for income tax year 2000.(1)

3. Under date of July 30, 2001, Mr. Stewart filed a petition for redetermination objecting to the assessment.

4. Under date of November 12, 2001, the Department denied Mr. Stewart's petition for redetermination, whereupon he filed a timely appeal to the Commission.

Docket No. 02-I-10

5. Under date of March 29, 2001, Mr. and Mrs. Stewart filed amended 1997, 1998, and 1999 Wisconsin income tax forms with the Department. These amended forms reported no income for each year and requested refunds of Wisconsin income taxes paid (presumably with the originally filed tax returns) in the amounts of $2,108 for 1997, $2,044 for 1998, and $2,051 for 1999. Attached to each amended return was a W-2 form issued to Mr. Stewart by Parker Hannifin Corporation and a W-2 form issued to Mrs. Stewart by the School District of Grantsburg. The W-2 forms showed petitioners' combined income and combined Wisconsin income tax withheld for the years at issue as follows:

Year Income Income Tax Withheld

1997 $45,604.99 $2,455.69

1998 $49,090.95 $2,767.03

1999 $50,879.60 $2,899.80

6. Under date of June 28, 2001, the Department denied petitioners' claims for refund.

7. Under date of July 30, 2001, petitioners filed a petition for redetermination with the Department, objecting to its denial of their claims for refund.

8. Under date of November 12, 2001, the Department denied the petition for redetermination, whereupon petitioners filed a timely appeal to the Commission.


Petitioners' assertions are not clear. Their primary assertion appears to be that Wisconsin's income tax statutes are written in such a manner that they do not apply to them. (See petitioners' Motion for Dismissal & Summary Judgment, filed April 19, 2002.)

Petitioners also assert that several Wisconsin income tax statutes adopt provisions of the federal Internal Revenue Code ("I.R.C."). This is correct. See, e.g., Wis. Stat. §§ 71.01(1), (4), and (6). Petitioners appear to assert that if the federal law is not set forth in full in the Wisconsin law, it is not a valid Wisconsin law. Petitioners' motion, at pp. 1-2. This is nonsense. The Wisconsin Supreme Court has held that when a statute incorporates another statute by specific reference, "the effect is the same as if the incorporated section was set forth verbatim and at length therein." State v. Lamping, 36 Wis. 2d 328, 336 (1967).

Petitioners admit that they are attempting to avoid paying Wisconsin income tax "using legal tax avoidance."(2) Petitioners further "recognize that they are Tax Protestors in the legal sense."(3) They appear to assert that by merely submitting an income tax form to the Department even though it states no income and asks for a full refund of Wisconsin tax withheld they have complied with the requirement to file a tax return each year pursuant to Wis. Stat. §§ 71.03(2) and (6). They also cite the definition of the word "file" in § 71.68(2) to support their contention that mailing a substitute W-2 form, which they drafted and which eliminated any amount of wages, somehow legitimizes their assertion that they had no wages.(4) This is absurd.

Wisconsin's income tax statutes are more straightforward than petitioners portray them in their submissions to the Commission. Under § 71.02(1), the state income tax is imposed on incomes of individuals residing in this state. Natural persons domiciled in this state with gross income above certain levels (which petitioners exceed) must file a Wisconsin income tax return each year for the preceding year. See Wis. Stat. § 71.03(2).

The Wisconsin Statutes state what income is taxable. Under § 71.03(1), "gross income" is defined to include "compensation for services". The definition of "income" is also adopted into the Wisconsin Statutes by reference to the I.R.C. See Wis. Stat. § 71.01(6). The I.R.C. defines "gross income" to include "Compensation for services . . . ." I.R.C. § 61 (intro.) and (1).

In a one-page document filed with the Commission on April 19, 2002, petitioners state that they are not lawyers and, for this reason, "may not use the exact language and phrases as used . . . by lawyers." They then state that they are "appealing to the [Commission] . . . for consideration as to the true meaning of what I [Mr. Stewart] am conveying either in voice or on paper. If there is any question or doubt as to that meaning, the [Commission] will endeavor to discover the true intent."

Petitioners appear to be asking the Commission to develop legal arguments for them, using proper terminology, based on their ramblings and their citations of Wisconsin Statutes, federal income tax regulations, and federal cases. They misunderstand the role of the Commission. Our function is not to develop arguments for either party. To the contrary, the Commission's function is to find facts, review statutes, and, based on the legal arguments of both parties, determine the correct application of the law to the facts. We decline petitioners' request.

Petitioners also argue that their appeals have not been instituted or maintained primarily for delay, and that their positions are not frivolous or groundless. This is not in response to any assertion or request by the Department that the Commission so rule under § 73.01(4)(am). But the Commission, on its own review, concludes that petitioners' positions in these proceedings are frivolous and groundless, and that an additional assessment is appropriate under § 73.01(4)(am).

Petitioners request that the Commission award them $100 for "redress." They contend that the Department has failed to state a claim on which relief can be granted by not explaining why they must pay income tax, citing Wis. Stat. §§ 802.06(2)(a)6 and 814.02(2).(5) The Commission has no authority under the statutes to award them "redress." Moreover, the record makes it clear that petitioners are owed no redress. The request is denied.

The Department requests $1,000 of costs on the grounds that this matter "is a frivolous appeal and there is no genuine issue as to material fact", citing §§ 73.01(4)(am) and 814.025.(6) There is no authority for the Department's request under § 73.01(4)(am).

Under § 814.025 ("Costs upon frivolous claims and counterclaims"), if an action commenced or continued by a party is found to be frivolous, the successful party may be awarded costs under § 814.04 and reasonable attorney fees. See Wis. Stat. § 814.025(1).

To support its request, the Department filed an affidavit requesting "costs in the amount of $1000 . . . ." The affidavit does not specify what the components are of this amount. Under § 814.04(2), this commission may require petitioners to pay the Department "[a]ll the necessary disbursements and fees allowed by law; . . . ." Examples of types of disbursements and fees, together with limitations on some of them, are specified in the statute. The Department's request does not specify what the requested costs are, nor the precise amount for each. Therefore, we award no costs. See Smith v. Wisconsin Dep't of Revenue, Wis. Tax Rptr. (CCH) ¶ 400-595 (WTAC 2002).

In support of their arguments for summary judgment and in opposition to the Department's motion for summary judgment, petitioners state that "the Department correctly refunded 2001 taxes filed for identical claims."(7) The Department asserts that this is not relevant and "this matter is under investigation at this time."(8) Facts regarding petitioners' income tax filings for 2001 are not encompassed by the pending motions for summary judgment, nor are they undisputed. Most importantly, they are of no relevance here.


1. Petitioners' motion for summary judgment is denied.

2. The Department's motion for summary judgment is granted, and its actions on petitioners' petitions for redetermination are affirmed.

3. Petitioners' motion for monetary "redress" is denied.

4. The Department's motion for costs is denied.

5. Petitioners are assessed an additional $500 pursuant to Wis. Stat. § 73.01(4)(am), as it appears to the Commission that the basis for filing their petitions for review is frivolous and groundless.

Dated at Madison, Wisconsin, this 10th day of July, 2002.



Don M. Millis, Commission Chairperson


Thomas M. Boykoff, Commissioner

Richard F. Raemisch, Commissioner


August 8, 2002 Petition for rehearing denied under § 227.49(3)

1 This document is not attached to the Department's affidavit. However, this information is provided in petitioner's petition for redetermination referenced in Finding of Fact 3. and in the Department's denial letter referenced in Finding of Fact 4.

2 Reply Brief to Notice of Motion and Motion for Summary Judgment submitted by Respondent, p. 2., filed May 9, 2002.

3 Reply Brief to Reply Brief of 5/20/2002 Submitted by Respondent, p. 2, filed June 10, 2002.

4 Reply Brief to Notice of Motion and Motion for Summary Judgment submitted by Respondent, p. 2.

5 Under different circumstances, these statutes might apply to the Commission by virtue of Wis. Admin. Code § TA 1.39, which reads in part: ". . . the practice and procedures before the commission shall substantially follow the practice and procedures before the circuit courts of this state."

6 Notice of Motion and Motion for Costs, filed April 26, 2002.

7 Reply Brief to Notice of Motion and Motion for Summary Judgment submitted by Respondent, p. 7.

8 Reply Brief of the Department in letter form, filed May 21, 2002.