Francis Steffan Hayes v. Commissioner of Internal Revenue

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
FRANCIS STEFFAN HAYES,
Petitioner-Appellant,
v.
COMMISSIONER OF INTERNAL
REVENUE,
Respondent-Appellee.
No. 20-71073
Tax Ct. No. 12037-17
MEMORANDUM*
Appeal from a Decision of the
United States Tax Court
Submitted May 18, 2021**
Before: CANBY, FRIEDLAND, and VANDYKE, Circuit Judges.
Francis Steffan Hayes appeals pro se from the Tax Court’s decision,
following a bench trial, upholding the Commissioner of Internal Revenue’s
(“IRS”) determination of deficiencies and additions, after concessions, for tax
years 2005 through 2009. We have jurisdiction under 26 U.S.C. § 7482(a)(1). We
* This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
** The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
FILED
JUN 1 2021
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS

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review de novo the Tax Court’s conclusions of law and for clear error its factual
findings. Meruelo v. Comm’r, 691 F.3d 1108, 1114 (9th Cir. 2012). We affirm.
The Tax Court properly upheld the IRS’s deficiency and additions
determination because the IRS presented “some substantive evidence” that Hayes
failed to report income, and Hayes failed to show that “the deficiency was arbitrary
or erroneous.” Hardy v. Comm’r, 181 F.3d 1004, 1004-05 (9th Cir. 1999); see also
I.R.C. § 6651(a)(1)-(2), § 6654.
The Tax Court properly concluded that the IRS’s use of the “specific items”
method to reconstruct Hayes’s income was appropriate, and that the substitute
returns were valid. See I.R.C. § 6020(b) (authorizing IRS to prepare substitute tax
return where taxpayer fails to file timely return and stating that such substitute
return is “prima facie good and sufficient for all legal purposes”); Choi v. Comm’r,
379 F.3d 638, 639-40 (9th Cir. 2004) (when a taxpayer fails to maintain or produce
adequate records of income, the IRS may use indirect methods to determine tax
liability); United States v. Marabelles, 724 F.2d 1374, 1377 n.1 (9th Cir. 1984)
(describing specific items method).
The Tax Court did not abuse its discretion by denying Hayes’s motions for
discovery because the denials did not cause actual and substantial prejudice. See

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26 U.S.C. § 7482(a)(1) (Tax Court decisions reviewed in same manner as decisions
from district courts in civil cases); Hallett v. Morgan, 296 F.3d 732, 751 (9th Cir.
2002) (providing standard of review and grounds for reversing district court
discovery decisions (citation and internal quotation marks omitted)).
We reject as meritless Hayes’s contentions that the Tax Court lacked
jurisdiction, that the Tax Court judge was biased against him, and that the IRS
erred in its application of 26 C.F.R. § 301.6020-1.
We do not consider matters not specifically and distinctly raised and argued
in the opening brief, or arguments and allegations raised for the first time on
appeal. See Padgett v. Wright, 587 F.3d 983, 985 n.2 (9th Cir. 2009).
Hayes’s motion to file a late reply brief (Docket Entry No. 29) is granted.
The Clerk will file Hayes’s reply brief submitted at Docket Entry No. 30.
AFFIRMED.

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