Christiansen v. Tax Commission

2020 UT App 46
THE UTAH COURT OF APPEALS
TERRE LYNN C HRISTIANSEN ,
Petitioner,
v.
TAX C OMMISSION , S COTT W. S MITH ,
AND JOHN L. VALENTINE, ET AL,
Respondents.
Per Curiam Opinion
No. 20190570-CA
Filed March 26, 2020
Original Proceeding in this Court
Terre Lynn Christiansen, Petitioner Pro Se
Sean D. Reyes and Brent A. Burnett, Attorneys
for Respondents
Before JUDGES M ICHELE M. C HRISTIANSEN F ORSTER , DAVID N.
M ORTENSEN , and R YAN M. HARRIS.
PER CURIAM:
¶1 	Terre Lynn Christiansen petitions for review of the Tax
Commission’s final order assessing tax deficiencies and penalties
for the years 2012 through 2016. Christiansen did not file state
tax returns in those years.
¶2 	In 2017, the Auditing Division sent Christiansen requests
for filing information for years 2012 to 2016, noting that Division
records showed that she had not filed state tax returns in those
years. The requests informed Christiansen that she could still file
the 	returns, 	and 	in 	addition 	identified 	for 	Christiansen 	the
information she should provide to the Division to enable it to
evaluate her filing status in the event Christiansen took the
position 	that 	she 	was 	not 	required 	to 	file 	tax 	returns.
Christiansen did not provide the information identified in the

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20190570-CA 	2 	2020 UT App 46
requests. However, in response to each request, Christiansen
sent a letter to the Division requesting that the Division provide
proof that Christiansen was required to file a federal tax return,
which 	is 	a 	prerequisite 	to 	the 	requirement 	to 	file 	a 	state
tax 	return. 	See 	Utah 	Code 	§ 	59-10-502(1) 	(LexisNexis 	2018)
(providing 	that 	a 	state 	tax 	return 	must 	be 	filed 	by 	every
resident individual who is required to file a federal income tax
return).
¶3 	In 	the 	absence 	of 	the 	necessary 	information 	from
Christiansen, the Division sent out notices of deficiency and
estimated income tax for the years in question. Each notice
included 	an 	estimated 	federal 	adjusted 	gross 	income 	and
showed 	that 	the 	income 	was 	greater 	than 	the 	sum 	of 	the
standard deduction and personal exemption, which triggers tax
liability. See id. § 59-10-104.1(2) (providing that an individual is
exempt from state income tax if the individual’s federal adjusted
gross income is less than or equal to the sum of the personal
exemptions and standard deduction).
¶4 	Christiansen responded to the notices of deficiency with
additional demands for proof that she was required to file a
federal tax return. She stated that she had requested such proof
from 	the 	Internal 	Revenue 	Service 	in 	2015 	and 	had 	never
received any evidence that she was required to file a federal
return. The Division construed these letters as a petition for
redetermination 	of 	the 	deficiencies 	and 	set 	the 	matter 	for
hearing. Ultimately, after a formal hearing, the Commission
upheld the deficiency and penalty assessments. After the denial
of her petition for reconsideration, Christiansen seeks review in
this court.
¶5 	On review, Christiansen continues to demand evidence
from the Commission showing that she was required to file
a 	federal 	tax 	return. 	However, 	in 	proceedings 	before 	the
Commission seeking a redetermination of a deficiency, with

Christiansen v. Tax Commission
20190570-CA 	3 	2020 UT App 46
some exceptions not applicable here, “the burden of proof is
on the petitioner.” Utah Code § 59-1-1417(1). Accordingly, it
is 	Christiansen 	who 	bears 	the 	burden 	to 	show 	that 	the
Commission’s assessments are in error. See also Jensen v. State
Tax 	Comm’n, 	835 	P.2d 	965, 	971 	(Utah 	1992) 	(“When 	a
recalcitrant or evading taxpayer refuses to file an income tax
return and the Commission is therefore compelled to reconstruct
financial 	data 	from 	available 	evidence 	to 	estimate 	the
taxpayer’s income, it is reasonable to shift the burden to the
taxpayer 	. 	. 	. 	to 	show 	that 	the 	Commission’s 	figures 	are
incorrect.”).
¶6 	Furthermore, the Commission provided evidence in the
notices of deficiency when it showed that Christiansen received
income 	greater 	than 	the 	filing 	requirement 	minimum 	for
federal tax returns. See 26 U.S.C. § 6012(a)(1) (providing that a
federal tax return is required by “every individual having for
the 	taxable 	year 	gross 	income 	which 	equals 	or 	exceeds
the 	exemption 	amount”). 	Although 	she 	argues 	that 	she 	is
exempt for other reasons, the Commission demonstrated as
an 	initial 	matter 	that 	Christiansen 	was 	required 	to 	file 	a
federal tax return and, therefore, was required to file a state tax
return.
¶7 	Christiansen argues that she is exempt from filing a
federal tax return because she is a member of a church, and “the
Church is exempt from federal taxation.” Under the federal tax
code, certain organizations are exempt from taxation. 26 U.S.C.
§ 501(a). “Corporations . . . organized and operated exclusively
for religious . . . purposes, . . . no part of the net earnings of
which 	inures 	to 	the 	benefit 	of 	any 	private 	shareholder 	or
individual,” are exempt from taxation. Id. § 501(c)(3). But even
assuming that Christiansen is a member of a church that is
exempt 	under 	section 	501(c)(3), 	she 	has 	not 	provided 	any
authority to support the proposition that a church’s tax-exempt
status extends to its individual members.

Christiansen v. Tax Commission
20190570-CA 	4 	2020 UT App 46
¶8 	Under the plain language of the statute, the tax exemption
belongs to the corporate entity. Id. “In order to be exempt under
section 501(c)(3), an organization must qualify under both the
organizational and the operational tests.” Basic Bible Church v.
Commissioner of Internal Revenue, 74 T.C. 846, 856 (1980). “The
operational 	test requires that 	an organization’s activities be
primarily 	those 	which 	accomplish 	one 	or 	more 	exempt
purposes” under the statute. Id. Furthermore, to be tax exempt,
an organization “must establish that it is not operated for the
benefit of private interests.” Id.
¶9 	Christiansen has acknowledged that she is a member of a
church and has not asserted that she has organized in any form
within the statute. Additionally, at the formal hearing, 	she
acknowledged that she received her own wages for her own
benefit. The wages did not go to the church. Christiansen, on her
own, is not eligible for a tax exemption under section 501(c) and
there is no support for her assertion that she, as an individual, is
entitled to a corporate church’s exemption.1 This is particularly
so when her wages were her own and “for the benefit of private
interests.”
¶10 	As Christiansen notes in her brief, the critical fact to be
determined is whether she was required to file a federal tax
return which would then require her to file a state tax return.
The Commission demonstrated that she was required to file a
federal tax return. Her belief that she was not required to file
does not negate that fact. The other arguments Christiansen
asserts have been rejected as “lacking in legal merit and patently
frivolous.” Lonsdale v. U.S., 919 F.2d 1440, 1448 (10th Cir. 1990)
1. In contrast to the religious organization exemption under
section 501(c)(3), under the tax code individuals are broadly
required to file tax returns and are exempt only if they do not
meet the minimum income level. 26 U.S.C. § 6012(a).

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20190570-CA 	5 	2020 UT App 46
(listing frivolous arguments including “wages are not income”
and “the income tax is voluntary”).2
¶11 	Accordingly, 	we 	decline 	to 	disturb 	the 	Commission’s
order.3
2. “The government may not prohibit the holding of these
beliefs, but it may penalize people who act on them.” U.S. v.
Carman, 2007 WL 9729022 (D. N.M. 2007).
3. Christiansen also requests payment for her time in litigating
this matter. Generally, pro se litigants are not entitled to recover
payment 	for 	representing 	themselves. 	Jones 	Waldo 	Holbrook
& McDonough v. Dawson, 923 P.2d 1366, 1375 (Utah 1996). And,
even where there is a basis for fees, a litigant must be the
prevailing 	party 	in 	order 	to 	recover. 	See, 	e.g., 	Valcarce 	v.
Fitzgerald, 961 P.2d 305, 319 (Utah 1998). We therefore deny
Christiansen’s request for payment.