In Uncategorized on 01/05/2017 at 20:14

While cases for years prior to those beginning last Sunday will continue with FPAAs, tax matterers, partner-level and partnership-level adjustments, computationals and deficiency reviewables, I hope that the new partnership regime will simplify the current silt-stirrings swirling around the Glasshouse at 400 Second Street, NW.

Here’s Hubert Oxford, III & Cynthia Oxford, Docket No. 16916-15, filed 1/5/17, from Judge Goeke.

You remember HO3 and Cynthia, of course. What, no? Well, check out my blogpost “Inside, Outside – Part Deux,” 6/21/16.

HO3 and Cynthia want to enjoin and restrain IRS from assessing and collecting, or make IRS disgorge if they did, and IRS wants to dismiss the petition and strike the penalty.

The partnership here involved had a FPAA, litigated at partnership level, and the adjustments and chops IRS laid upon HO3 & Cynthia all arise therefrom.

HO3 & Cynthia say it’s premature to hit them with a deficiency; IRS doesn’t fight the adjustment issues, but claims Tax Court has no jurisdiction over the chop.

Judge Goeke: “The following quotation from Thompson v. Commissioner, T.C. Memo. 2014-154, at *3, aptly describes the law as it applies to this case:

“‘Our final decision in the partnership-level proceeding applied the gross valuation misstatement penalty. The penalty may be directly assessed as a computational adjustment, notwithstanding any need for [*9] partner-level determinations. Petitioners may raise partner-level defenses, if any, only in a postpayment refund suit. See sec.6230(c)(1)(C); sec.301.6221-1(c), Proced. & Admin. Regs.

“‘Any question as to the validity of this analysis has been settled by United States v. Woods, 571 U.S.__,134 S.Ct. 557(2013).’” Order, at pp. 1-2.

So no restraining the chop, although the adjustment impact on HO3 & Cynthia are put off for another day.

But as I said in my blogpost above referred to, “I have a feeling that these face-offs will be going on long after TEFRA is an unpleasant memory, when we’ll be grousing about PATH partnership audits.”



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