This one is for the IRS, says Ch J Michael (“Iron Mike”) Thornton in Roosevelt Powell, Docket No. 26454-13S, filed 3/31/14. Note well that letter “S”, for thereby hangs the tale.

IRS wants a Rule 37(c) order that undenied allegations in their answer be deemed admitted, because Roosevelt didn’t serve and file a reply to IRS’ answer denying them.

But Ch J Iron Mike reminds IRS of Rule 173(c). In a small-claimer (“S”) like this, petitioner (taxpayer) Roosevelt is barred from serving and filing a reply unless the Judge tells him, failing which any affirmative allegations in the answer are deemed denied.

IRS never asked for a reply, Ch J Iron Mike never told Roosevelt to reply, so IRS’s desired admissions that Roosevelt committed fraud on his 2001 return (thus opening an otherwise closed SOL) are deemed denied.

Ordinarily I’d give IRS a Taishoff “good try, third class”, but this falls below even my minimal standard for crafty. More like desperation, when they haven’t got “clear and convincing” evidence.