In Uncategorized on 08/16/2013 at 04:00

 Riding the Dawn Patrol out of New York Penn Station to the Capital of the Confederacy, I remembered to blog an opinion from what is now yesterday, 8/15/13, Staffmore, LLC, 2013 T. C. Memo 187.

Again the mantra: the SNOD is the ticket to Tax Court.

Does any reader remember Karl E. Cross and his travails before His Honor Big Julie, a/k/a Judge Julian Jacobs (hereinafter HHBJJJJ)? No? Not surprised; the same are more particularly bounded and described in my blogpost “Got Your Ticket?”, 12/13/12.

Well, Staffmore’s problems are different to Karl E.’s, inasmuch as Karl E.’s SNOD, dodgy as it was, was still a SNOD. Staffmore never had one, so its attempt to appeal the employee reclassification of the pseudonymous SH, and stay IRS from making public the SS-8 letter so holding until its appeal is decided, fails.

By the way, Staffmore’s business is to provide personnel to providers of mental and behavioral health services. Good training for Tax Court and the Internal Revenue Code generally.

HHBJJJJ gets this one, and he kicks Staffmore to the curb.

Background, per HHBJJJJ: “…petitioner’s attorney… mailed a letter to respondent objecting to respondent’s employment status determination and stating: ‘We are requesting that this redacted determination letter be deleted and not published at all during the review and appeal period as we plan to petition the Tax Court on both issues. It is our understanding that the release of this letter is prohibited pending reconsideration and appeal of the SS-8 determination.’” 2013 T. C. Memo 187, at p. 5. (Name omitted).

Following the obligatory incantation that Tax Court’s jurisdiction is limited, and only by express Congressional grant can Tax Court live, move and have its being, HHBJJJJ goes straight to Section 7436(a): “…in connection with an audit of any person, there is an actual controversy involving a determination by the Secretary as part of an examination”, 2013 T. C. Memo. 187, at p. 7.

Staffmore’s counsel, hereinafter Johnny T., says that the SS-8 notification letter was a determination (maybe he read the whistleblower cases).

IRS says it wasn’t a Section 7436(a) determination, and in any case there’s no audit.

Johnny T.’s not done, though: “Finally, petitioner asserts that if respondent’s motion is granted because of what petitioner refers to as ‘hyper-technical arguments’, the Court would be wasting judicial resources because the employment status of SH would eventually be resolved by the Court after respondent issues petitioner a notice of deficiency.” 2013 T. C. Memo. 187, at p. 8.

While to the legal mind judicial economy is a prime desideratum, it doesn’t go in Tax Court. Absent examination (audit) and SNOD, Tax Court can’t go there.

“Petitioner’s submission of Form SS-8 is in essence a request that the IRS make a determination as to a worker’s employment classification for a taxable period or periods separate and apart from the IRS’ normal audit and examination procedures. See Rev. Proc. 2005-32, sec. 4.03(2), 2005-1 C.B. 1206, 1207. The submission of Form SS-8 is analogous to a taxpayer’s request for a private letter ruling.” 2013 T. C. Memo. 187, at p. 8, footnote 3.

Wait for the audit and the SNOD, then go to Tax Court.

Now Section 6110(f)(3) gives Tax Court jurisdiction to determine disputes about what should be published in the IRS Electronic Reading Room. But that doesn’t help Johnny T., because he wanted publication of the entire SS-8 suspended “pending appeal”, and Tax Court has no jurisdiction to hear said appeal, so Johnny T.’s request for what amounts to an injunction pendente lite, as the high-priced lawyers say, is moot, because there will be no lite. Not yet.

So HHBJJJJ doesn’t need to do the “we ain’t got no general equitable jurisdiction either” foxtrot.

I don’t want to be misunderstood here. A critic of my blog claims I make fun of litigants, lawyers and judges, and calls down Divine wrath upon my balding head (I won’t send the bears after him; see 2 Kings 2:23-25).

Maybe I have gotten a trifle acerbic at times, but not here. My sympathies are with Johnny T. He is another lawyer who spins out in the chicane that is Tax Court and its labyrinthine anfractuosities. It’s not his fault. Obviously he is used to courts of general jurisdiction, where judges deal with matters head-on, generally.

But that isn’t Tax Court. Hyper-technical distinctions are where it’s at. So, as to Staffmore and the pseudonymous SH, in the immortal words of the late great Charles Dillon Stengel, you could look it up.


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