Magnolia West Properties, LLC, Magnolia West Manager, LLC, Partnership Representative, Docket No.  6924-23, filed 2/27/26, boasts an impressive four (count ’em, four) trusty attorneys from each degree of latitude. And IRS’s four-person crew is no less credentialed.

But as Branertonians these eight (count ’em, eight) worthies are a wee bit short of the mark, according to Judge Ronald L. (“Ingenuity”) Buch.

One of IRS’ stalwarts apparently sent two (count ’em, two) letters on the same day, one to third parties and one to Magnolia, whereby the Magnolias claim he ambushed them. But Judge Ingenuity Buch finds he rectified the situation within eight (count ’em, eight) days, Order, at p. 4.

The attorneys had Branertoned with partial success, when the usual jumpball over privilege commenced. And here the Magnolias, seeking a Rule 103 protective order, are short of substance.

“In sum, Magnolia West asks us to issue a protective order to preserve privileges that Magnolia West has not established. Magnolia West asks us to order the Commissioner to destroy documents that he obtained permissibly and in a manner that allowed both the third parties and Magnolia West to preserve any privileges that might apply. And Magnolia West asks us to order the Commissioner to comply with a rule that does not apply to the actions undertaken by the Commissioner. We will deny the motion, but we will do so without prejudice. Magnolia West may be entitled to a protective order if it provides sufficient information to establish the applicability of a privilege (and the absence of a waiver) on a document-by-document basis.” Order, at p. 5.

So try again, but until then, no protective order.

Taishoff says preface every privilege claim by preparing an item-by-item privilege log in advance of your motion. It concentrates your mind, and will concentrate the judge’s mind, wonderfully.

No, not a preview of March Madness. Judge Joseph Robert (“JR”) Goeke delves deep into Schedules E and F, and Form 8960 Net Investment Income Tax–Individuals, Estates, and Trusts, in Gary M. Schwarz & Marlee Schwarz, Docket No. 12347-20, filed 2/27/26.

Doc Gary’s goofy reg case featured here sub. nom. “The Buck Stops Here,” 5/13/24, “The Goofy Silt-Stir,” 11/5/24, and “Muddying the (Goofy) Waters,” 11/24/25.

Now Judge Joseph Robert (“JR”) Goeke gets granular with the reckoning and reporting of the Section 1411 Net Investment Income Tax, as Doc Gary and IRS are enmeshed in the Rule 155 beancount. 

“Petitioners failed to address the fact that for each year the other income that they included on line 4a of their adjusted Forms 8960 was offset by their adjustments to line 4b. In effect, petitioners are seeking more than a 100% offset of the other income: (1) a 100% offset on line 4b, and (2) an additional offset on line 9c. In other words, petitioners seek both (1) a 100% offset of the other income as if it was ‘derived in the ordinary course of a non-section 1411 trade or business,’ see Form 8960 line 4b, and (2) an additional offset for ‘Miscellaneous investment expenses,’ see Form 8960 line 9c, as if the other income was gross net investment income pursuant to section 1411(c). These positions are plainly contradictory and nonsensical.

“We need not delve into the parties [sic] arguments regarding (1) whether income subject to section 183 and related expenses are included in the Net Investment Income calculation, and (2) the calculation method for line 9c deductions. At most, petitioners are entitled to offsets/deductions of 100% of the gross other income, which respondent’s calculations already include.” Order, at p. 4.

I expect my journalistic colleague Peter Reilly, CPA, will find this dénouement to a hobby-loss case a useful addition to his collection.

Three (count ’em, three) items for the scrapbook today, none worthy of an individual blogpost.

Tracey Yvonne Lucas, T. C. Memo. 2026-22, filed 2/26/26, wanted to “help people,” so she ran a sole proprietorship called “Tracey’s TLC.” Unhappily, Judge Kashi (“My or the High”) Way finds she had only one client, no separate bank account, reported no income therefrom (although she got a few bucks looking after a neighbor’s child), and got her claimed deductions Section 274’d away.

Mark Hassan, Docket No. 10565-19, filed 2/26/26, has Judge Fung denying IRS document production and Mark’s assertion of privilege with what I would call RTFSPTO (“Read The Standing Pre Trial Order”)(the “F” is for emphasis). “Given the procedures and impending deadlines set out in the Court’s Standing Pretrial Order, we need not address any infirmities in the parties’ filings and we will not address whether petitioner’s assertion of the attorney-client privilege and the work-product doctrine is sufficient to defeat the relief sought in respondent’s Motion. If either party intends to use any documents at trial, that party must exchange them as part of the Stipulation of Facts or as the party’s Proposed Trial Exhibits within the prescribed deadlines.” Order, at p. 2. Maybe privilege is a shield, not a sword; if ya hide ’em, ya can’t use ’em.

Todd O. Olson, Docket No. 28000-22L, filed 2/26/26, would give rise to a Shakespearean pun if I were that way inclined, but I’ll spare you. Judge Cary Douglas (“C-Doug”) Pugh exhaustively surveys Tax Court’s mechanisms for holding no-show petitioners in default, and so holds Todd. Judge C-Doug Pugh adds a stinger: “We warned petitioner on multiple occasions that we may impose a penalty pursuant to section 6673 if he persisted in making frivolous arguments. Petitioner’s silence may imply that he had no non-frivolous response to respondent’s Motion. But because he did not respond with frivolous arguments after we warned him, we will not impose a section 6673 penalty at this time. We remind petitioner that our warnings regarding section 6673 also apply to any future cases in this Court.” Order, at p. 4, footnote 2.