Attorney-at-Law

“ALS OB”

In Uncategorized on 11/22/2016 at 14:58

Judge Lauber, M.A. Clare College, Cambridge, seems to have studied philosophy as well as classics. Today he turns back to the early Twentieth Century German philosopher Hans Vaihinger, author of Die Philosophie des Als Ob (The Philosophy of “As If”), 1911.

No, this is not the dismissive rejoinder of my daughters’ school days, expressive of disbelief, which went something like this: “I got a date with Jeffrey this weekend.” “As if!”

Today we have Judge Lauber parsing the difference between “as” and “as if” in Zipora Klein, et al., Docket No. 24595-15L, filed 11/22/16.

Zip and the et als got nailed for tax crimes, and have mostly paid the restitution with which USDCCDCA hit them. But IRS wants interest. As a much better writer than I put it, “I crave the law, the penalty and forfeit of my bond.”

And IRS rests on IRM pt. 25.26.1.2 (March 24, 2014). But that isn’t law.

So Judge Lauber asks the parties to brief the law. But this being the commencement of the Season of Giving, Judge Lauber, though from the government, is actually here to help.

“Section 6201(a)(4)(A) provides that ‘[t]he Secretary shall assess and collect the amount of restitution under an order pursuant to section 3556 of Title 18, United States Code, for failure to pay any tax imposed under this title in the same manner as if such amount were such tax.’ (Emphasis added.) At least one court seems to have construed the phrase ‘as if such amount were such tax’ to mean that a resulting restitution-based assessment would not actually constitute ‘a tax’ imposed under Title 26. See United States v. Tilford, 810 F.3d 370, 372 (5th Cir. 2016) (‘Criminal restitution, even as a penalty for a failure to pay taxes, is not a tax.’). If restitution is assessed and collected as if it were a tax, rather than as an actual tax, a question arises whether underpayment interest under section 6601(a) should apply.” Order, at p. 2.

But Judge Lauber’s benevolent assistance is hardly so scanty.

“In Muncy v. Commissioner, T.C. Memo. 2014-251, 108 T.C.M. (CCH) 606, vacated and remanded on other grounds, 637 Fed. Appx. 276 (8th Cir. 2016), we contrasted the language of section 6201(a)(4)(A) with that of section 6665(a)(1). The latter section provides that various penalties, additions to tax, and additional amounts ‘shall be assessed, collected, and paid in the same manner as taxes.’ (Emphasis added). We noted in Muncy our belief ‘that the distinction between “as if” and “as” is significant.’ 108 T.C.M. (CCH) at 609. It is well-established that interest under section 6601(a) arises on penalties, additional amounts, and additions to tax. Since restitution is assessed and collected ‘as if it were a tax,’ rather than ‘in the same manner as a tax,’ a question arises whether underpayment interest under section 6601(a) should apply.” Order, at p. 2.

And take a look at Section 6305(a). Child support can be collected by IRS “as if it were a tax.” But Section 6305(a)(1) says no interest.

Judge Lauber isn’t through yet. “We invite the parties’ views as to whether any inference should be drawn, with respect to liability for interest on amounts assessed under section 6401(a)(4)(A), from section 6305(a) or other Code provisions that refer to amounts assessed ‘as if’ they were taxes.” Order, at pp. 2-3.

There’s yet more for IRS and Zip’s and the et als’ attorneys to digest along with their turkey and maple bourbon mashed sweet potatoes. And after they’ve swallowed a wee digestif, IRS has until the end of January, and Zip until the end of March, to send in their answers.

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