In Uncategorized on 08/07/2013 at 16:06

That’s the lesson from STJ Armen, the Judge With A Heart (see my blogpost “A Judge With A Heart”, 6/6/13), in James Cecil & Anne-Marie Swank, Docket No. 20448-12S, filed 8/7/13, today’s designated hitter.

IRS says the issues in this case are “whether petitioners are entitled to claim tax credits under I.R.C. § 901(a) for two specific taxes paid to the French government, the contribution sociale généralisée (“CSG” ) and the contribution pour le remboursement de la dette sociale (“CRDS”).” Order, at p. 1.

Now I have no idea what these “contributions” might be, much less whether either or both are foreign taxes creditable under Section 901.

But IRS doesn’t want those questions decided in a small-claimer, which is non-appealable and non-citable as precedent. So IRS asks to remove the small case designation and to continue the trial, because a full-dress Tax Court case is pending where the same French “contributions” are at issue, and that case has been fully briefed and submitted for summary judgment (decision as a matter of law, as no facts are disputed).

Jimmy and Anne-Marie object to IRS’ motions, but STJ Armen finds merit as to continuing (adjourning) their trial until the full-dress is decided.

“It would appear that the issue whether the CSG and the CRDS are creditable taxes under I.R.C. section 901(a) is a legal issue of first impression. It is contrary to the Court’s practice to decide legal issues of first impression in the context of small tax cases, which cases are non-appealable and non-precedential. See I.R.C. sec. 7463(b). This is particularly so when the same legal issue is pending in a regular case, which case is potentially appealable and precedential and where the issue therein has already been briefed by the lawyers for both the taxpayer and the Commissioner and is under consideration by the Court.” Order, at p. 2.

Besides, the decision in the full-dress might resolve Jimmy’s and Anne-Marie’s case without the need for any more paperwork.

And STJ Armen denies IRS’ motion to drop the small-claims designation in Jimmy’s and Anne-Marie’s case without prejudice to renewal, if later circumstances warrant (like if the full-dress case gets dropped or settled before a decision, so Jimmy and Anne-Marie can go play in the big leagues).

Tax Court doesn’t sweat the small stuff.

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