In Uncategorized on 06/28/2017 at 14:20

Turns out Judge Ruwe used IRS’ 50% numbers for the Boston Bruins’ snacks and chow-downs yesterday. See my blogpost “Feed Those Bears!” 6/27/17. So today we get Jeremy M. Jacobs and Margaret J. Jacobs, Docket No. 19009-15, filed 6/28/17.

Judge Ruwe modifies his opinion thus: “On page 12 [last sentence], line 19, ‘$127,877 and $142,223, respectively.’ is deleted and ‘$255,754 and $284,446, respectively, for pregame meals provided to the Bruins’ traveling employees while at away city hotels.’ is substituted therefor.” Order, at p. 1.

So Jer and Marg get 100% for feeding the Bruins.


In Uncategorized on 06/27/2017 at 16:57

Notwithstanding the words of Jessie J, Dr. Luke, Claude Kelly and B.o.B. from their 2011 hit “Price Tag,” it is about the money, and IRS wants to amend its petition to claim judicial estoppel against Moneygram International, Inc. and Subsidiaries, et al., Docket No. 12231-12, filed 6/27/17.

Y’all will remember Moneygram, having been stomped in Tax Court back in January, 2015, took the Fifth (that is, the United States Court of Appeals for the Fifth Circuit), and scored a per. cur. remand back to Judge Lauber.

And if you didn’t remember, see my blogpost “Maybe You Can Bank On It,” 2/15/17.

Well, aside from giving discounts (which doesn’t mean what most people think it means, when you’re dealing with banks), the question remains whether Moneygram and the subs make loans to their agents, the floggers of Moneygram’s payment instruments, when the agents get money but don’t forward same to MoneyGram forthwith.

Banks make loans, and Moneygram needs to be a bank to get $82 million of Section 581 offsetting capital losses. Moneygram charges no interest, but banks don’t have to charge interest to be banks (although find me a bank that will lend me money at no interest, please).

Now judicial estoppel means that you took one position in a litigation and now want to backtrack when it suits you. Judge Lauber lets IRS amend, claiming Moneygram knew for three years that IRS would take the position that Moneygram wanted it both ways, and amendment is liberal if no prejudice. There are no disputed facts.

If Moneygram made loans to agents by letting them hang onto Moneygram’s money, the relationship between Moneygram and agents is creditor-debtor.

But here’s the kicker: “Respondent contends that petitioner has successfully argued in other courts, including bankruptcy courts, that it has a fiduciary relationship, not a debtor-creditor relationship, with its agents. Respondent wishes to amend his answer to assert judicial estoppel as an affirmative defense.” Order, at pp. 1-2. Neither Tax Court nor Fifth Cir. had considered this before now.

It’s pretty obvious when you think about it. If an agent is holding Moneygram’s cash, and if the cash is a loan, should the agent tank and file Chapter, Moneygram is just another unsecured general creditor, likely to get a scanty serving of cold bortscht when the goodies are doled out. But if the agents are trustees or fiduciaries, the cash always belongs to Moneygram and hands-off to the creditors, secured, unsecured or otherwise.

This is not a tangential issue. Banks make discounts, but they also make loans without discounting commercial paper.

Should be interesting reading when this all sorts out…if they don’t settle.


In Uncategorized on 06/27/2017 at 16:14

So often do ex-spouses whose divorce decrees specify the other spouse must pay all income tax liabilities discover the hard way that IRS doesn’t enforce divorce decrees. That the ex-spouse so obligated stiffs both the loved-once and the IRS is unfortunate, but STJ Diana L. Leyden is no more sympathetic than any other judge: the law is what it is, and the State court decree cuts no coarse-grain Dijon in the USTC.

I’ve given up citing to the large number of such cases I’ve blogged, and the unblogged substantially exceed the blogged.

Today, however, Patrice Anna Butsko, Petitioner and Geoffrey W. Butsko, Intervenor, Docket No. 17147-16S, filed 6/27/17 show how to save a Section 6015 innocent spousery when it’s about to crater.

Patty Ann petitions a NOD dumping her innocent spousery, even though Geof was supposed to pony up the tax, add-ons and chops, because he didn’t. It’s a “stand alone,” that is, an application for innocent spousery without a SNOD involved.

Patty Ann wasn’t done, though. She haled Geof into the Circuit Court of Loudoun County, VA.

STJ Di picks up the tale. Patty Ann sends STJ Di a billet doux: “Please find the following documents that relate to the satisfaction of the IRS outstanding taxes and responsibility. The matter was tried, in Loudoun County… and resolved in court… with proof of payment. Please let me know if there is any other documentation that is needed for the closing/withdrawing of the above mentioned Docket number (removal from the case).

“Petitioner attached to her letter a copy of an order from the Circuit Court of Loudoun County… finding that intervenor was found in willful contempt for his failure to pay the 2010 tax liability and ordering him to either pay in full or establish an installment agreement with the IRS to pay the entire tax liability for 2010…. Petitioner also attached to her letter a copy of correspondence from intervenor’s attorney in that case… stating that intervenor had paid, among other tax liabilities, the 2010 tax liability and including a copy of the check as proof of payment.” Order, at pp. 1-2.

Now Patty Ann wants STJ Di to toss without prejudice. While petitioners can move to dismiss a “stand-alone,” if the 90-day clock has run, so has petitioner’s chance to contest afresh.

“However, dismissal without prejudice is not possible at this stage of the proceeding. Because petitioner will be outside of the 90-daywindow for filing another stand alone petition challenging the IRS determination, dismissal of this case will preclude her from further contesting in this Court her entitlement to section 6015 relief for the tax year at issue.” Order, at p. 2 (Citations omitted).

So, since neither Patty Ann, nor Geof, nor IRS objects, petition dismissed.

Takeaway- If one spouse agrees but welches, sue early and sue often.