In Uncategorized on 07/24/2013 at 16:28

But if you don’t come back to us, game over. That obliging jurist, Judge David Gustafson, once again shows his obliging ways to Sean Richards, in 2013 T. C. Memo. 171, filed 7/24/13. But Sean does not respond to Judge Gustafson’s generosity.

Sean, like John Carter, the star of my blogpost “We’ll Come To You”, 9/18/12, is in the Stony Lonesome, the duration of his stay therein being indefinite.

Sean got a distribution from a qualified retirement plan, but wasn’t yet past the magic 59-1/2 year milestone, so he’s looking at the 10% excise tax. And he has no back-up for his claimed lifetime learning credit. And he claims he never got his refund (but that went for child support).

Well, IRS wanted to toss Sean for non-prosecution when he didn’t reply to their Branerton show-and-tell letter. But Judge Gustafson refused, saying that Sean’s situation as a prisoner makes it hard to participate in a show-and-tell, but likewise IRS needn’t wait until Sean rejoins the Land of the Free.

Maybe this case is ripe for a Rule 121 summary judgment. Maybe there are no disputed facts. So Judge Gustafson suggested IRS move for summary judgment, and instructed Sean on summary judgment and where to look on the Tax Court website to find out what to do.

IRS did; Sean didn’t.

Still, Sean as non-movant gets every reasonable doubt and benefit of every inference. “However, the non-moving party may not sit on his hands. He is required by Rule 121(d) to ‘set forth specific facts showing that there is a genuine dispute for trial. If the adverse party does not so respond, then a decision, if appropriate, may be entered against such party.’ Despite having this requirement called to his attention, Mr. Richards failed to make any response to the IRS’s motion for summary judgment.

“As a general rule, a petitioner like Mr. Richards bears the burden of proof at his trial in a deficiency case. See Rule 142(a)(1). The Supreme Court has held that where the party who does not have the burden of proof (the Commissioner) has attempted discovery, but the party with the burden of proof (Mr. Richards) has not responded with evidence sufficient to carry his burden of proof, summary judgment may be granted in favor of the party who shows that discovery yielded no evidence. Celotex Corp. v. Catrett, 477 U.S. 317, 323-324 (1986).” 2013 T. C. Memo. 171, at p. 8.

So Sean is out on the 10% hit, and out on the lifetime learning credit (although give Judge Gustafson credit, he taught Sean plenty).

As for the refund Sean didn’t get, “(F)irst, section 6402(c) provides that ‘[t]he amount of any overpayment to be refunded * * * shall be reduced by the amount of any past-due support’ (emphasis added), see also 42 U.S.C. sec. 664(a)(1) (2006); and section 6402(g) provides that ‘[n]o court of the United States shall have jurisdiction to hear any action, whether legal or equitable, brought to restrain or review a reduction authorized by subsection (c)’. This bars us from reviewing the reduction of Mr. Richards’s 2009 overpayment to pay his child-support debt.” 2013 T. C. Memo. 171, at p. 10.

In fact, the Supremes have held that to get a refund one must sue in USDC or CFC, as Congress didn’t let Tax Court go there. See United States v. Clintwood Elkhorn Min. Co., 553 U.S. 1, 11 (2008).

Takeaway–If an obliging Tax Court Judge offers to come to you, be prepared to come back. And if you want tax money back, don’t waste time in Tax Court.


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