In Uncategorized on 02/10/2015 at 16:03

Not even The Judge With a Heart, STJ Armen, can relieve a petitioner of interest on a deficiency, especially when the amount of the deficiency is stipulated. This is the bad news to Rodney James Samuel, Jr., Docket No. 8817-13S, filed 2/10/15.

Rod’s pro bono counsel from a local tax clinic worked out a deal for Rod. IRS wants to enter decision including interest, but Rod objects, claiming the clinician told him no interest would be due because the deficiency was in dispute.

IRS’s counsel says he told Rod that he would owe the interest on whatever the settlement number might be.

STJ Armen asks the clinician to weigh in. She does, and says she sure did tell Rod he’d owe interest.

“Generally, matters involving interest do not fall within the scope of this Court’s jurisdiction in an action for redetermination of a deficiency in tax….Although there are certain very narrowly-defined exceptions to this general rule, none of those exceptions apply in the instant case.

“It is unfortunate if petitioner misunderstood the law that in a case such as his a taxpayer is liable for interest on any deficiency in tax and that the Court has no authority in such a case to relieve the taxpayer of any part of such interest even if the parties were to agree to such matter. Therefore, no purpose would be served in delaying entry of decision in this case given the fact that the parties have resolved all of the substantive issues. Petitioner should understand that delay will lead to that much more interest.” Order, at pp. 2-3. (Emphasis by the Court).(Citations omitted).


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