José M. Curet echoes Steven Sondheim’s words from sixty years ago in 2016 T. C. Memo. 138, filed 7/25/16.

José was a self-employed consulting engineer who resided in Puerto Rico throughout the year at issue. He paid income tax timely to the Commonwealth, but never paid SE. José said he didn’t owe any US tax, only Puerto Rico tax.

Wrong, José.

“Petitioner argues that he was not subject to any U.S. tax for 2010 because he was a resident of Puerto Rico.  Petitioner had net earnings from self-employment as evidenced by his Schedule M that he filed along with his Form 482.0.  Although he was a resident of Puerto Rico during 2010, per section 1402(a)(6), petitioner was not exempt from U.S. self-employment tax.  We conclude petitioner is liable for self-employment tax.” 2016 T. C. Memo. 138, at pp. 4-5.

As for additions and chops, “Respondent [IRS] has shown, and petitioner does not dispute, that petitioner failed to pay his Federal income tax obligations for 2010.  Respondent has established that the Secretary prepared a substitute for return for 2010 that satisfies requirements of section 6020(b) by providing a Form 4549-A, a Form 886-A, and a Form 13496 for tax year 2010.  See Cabirac v. Commissioner, 120 T.C. at 170-172.  Respondent has met the burden of production.” 20156 T. C. Memo. 138, at p. 6.

José claims he talked to a Puerto Rican tax adviser, but same doesn’t testify. So no evidence adviser had any qualifications, or had all the information, or that José relied in good faith.