Cathryn A. Simmons, T.C. Memo. 2026-34. filed 4/22/26, ran a shop thus entitled with her sister, which sold “handmade and small-batch specialty goods,” T. C. Memo. 2026-34, at p. 2. Cathryn and sister funded operations with multiple credit cards and family loans, all in their individual names.

Ch J Patrick J (“Scholar Pat”) Urda holds the interest the sisters paid on these were personal interest, as their documentation that these were obligations of Stuff, their box-checked LLC. Ch J Scholar Pat also notes that neither the Cathryn’s trusty attorney nor IRS’s counsel raised TEFRA or BBA, but the partnership-level adjustments appear to be correct, T. C. Memo 2026-034, at p. 5, footnote 4.

Want of documentation writes off much of what IRS doesn’t concede, but Stuff’s charity party deductions survive.

“The Commissioner here concedes that Stuff spent $4,407 on advertising and promotion expenses and $20,668 on its charity parties. He asserts, however, that Ms. Simmons did not carry her burden to show\ that the party expenditures served a legitimate business purpose. We disagree. As Ms. Simmons’s sister testified, Stuff used its associations with charities to promote the purchase of its merchandise. For over a month near the end of the year, Stuff hosted parties for various charities, which typically received 15% of the sales from the day or evening of the party. By tying charitable contributions to sales on a particular day, Stuff leveraged the milk of human kindness to encourage customers to visit its store and purchase its merchandise. Stuff saw the expenses associated with its charitable parties as a means to drive sales, and we conclude that they were legitimate business expenses.” T. C. Memo. 2026-34, at p. 12.

Caution is advised, however, before you cite this case in your next charitable donation memo of law.

“Relying on Treasury Regulation § 1.162-15(a), the Commissioner argues that Stuff’s charity party expenditures were not legitimate expenses because they were not made with a reasonable expectation of financial return commensurate with the amount of payment. We note that the version of the regulation on which the Commissioner relies was not issued until 2020 and has no applicability to Stuff’s 2017 tax year. See Treas. Reg. § 1.162-15(a)(4).” T. C. Memo. 2026-34, at p.12, footnote 10.

Cathryn’s trusty attorney did well with a poor set of facts, earning a Taishoff “Good Job, third class.”

No, I’m not going to insult my ultrasophisticated readers by telling them about IRS’ Refund Tracker. No one who reads this my blog needs such babyfood. Rather, this is the story of Renee Elaine White, Docket No. 878-26S, filed 4/21/26, who wants Tax Court to give her “reimbursement for payments made with respect to the 2014, 2015, 2016, and 2017 tax years, for which petitioner was granted innocent spouse relief pursuant to Internal Revenue Code (I.R.C.) section 6015(c).” Order, at p. 1.

Renee stiped out her innocent spousery last October, no runs, no hits, no errors (no tax due, no refund due, no penalties due). But Renee claims runners left on base for the said four (count ’em, four) years of spouse’s tax obligations. IRS ripostes with “no SND, no NOD, no jurisdiction.”

Ch J Patrick J. (“Scholar Pat”) Urda calls Renee out at Tax Court.

“…the relief requested by petitioner—refunds for various tax years —is not within the Court’s authority to grant in this case. In a case based on a notice of deficiency, in which the Court must determine the correct amount of tax, this Court may make a determination concerning whether there has been an overpayment of tax. See I.R.C. § 6512(b). Otherwise, this Court does not have jurisdiction to make determinations concerning overpayments or refunds. Taxpayers generally have two years to file a lawsuit following the disallowance of a claim for refund. See I.R.C. §6532(a)(1). The Tax Court, however, is not the proper court in which to file such an action. A taxpayer may seek a judicial remedy for wrongful denial of refund claims—i.e., a refund suit in compliance with I.R.C. sections 6532(a)(1) and 7422(a)—either in the United States Court of Federal Claims, pursuant to 28 U.S.C. section 1491(a)(1), or in Federal district court pursuant to 28 U.S.C. section 1346(a)(1). Those statutes do not confer refund jurisdiction on the Tax Court. Accordingly, this Court cannot and does not decide whether petitioner is entitled to recover a refund….” Order, at p.2.

Edited to add, 4/21/26: Even if Tax Court had jurisdiction, see Order at p. 2. Renee submitted Form 843 refund claim two (count ’em two) months ago. Section 6532(a)(1) imposes a six-month cooling off period before a refund suit can be commenced, unless IRS sooner denies (which Renee doesn’t allege).

I had hoped to pass on to you some enlightenment anent the Families First Coronavirus Response Act (FFCRA), Pub. L. No. 116-127, §§ 7002, 7004, 134 Stat. 178, 212, 217 (2020) (as amended by the Consolidated Appropriations Act, 2021, Pub. L. No. 116-260, div. N, § 286, 134 Stat. 1182, 1989 (2020)), and those enacted by the American Rescue Plan Act of 2021 (ARPA), Pub. L. No. 117-2, §§ 9642 and 9643, 135 Stat. 4, 171, 174 (2021). 

Alas, Judge Kashi (“My or the High”) Way gives us nothing but a defective-documentation case that, in his words, “… go beyond poor recordkeeping and suggest pure fabrication,” Marie M. Kanda, T. C. Sum. Op. 2026-3, filed 4/20/26, at p. 9. (Footnote omitted).

I leave it to you to read Judge Way’s unbaling of Marie’s various reporting positions. I really stopped following them, although Marie’s list of ailments at p. 2 did evoke enough sympathy for me to understand why IRS folded the Section 6676 excess deductions and credits chop.