Tax Court Will Join Together

To get the backstory for this blogpost, check out my blogpost “Whom the Preparer Puts Asunder – Part Deux,” 1/5/17, the contrarian 8 Cir putdown to Judge Nega, and the earlier blogpost therein cited. So now you can understand Fansu Camara and Aminata Jatta, 149 T. C. 13, filed 9/28/17, a lucky 13 for Fan and Ami, pro sese.

Fan checked the wrong box for one of the two years at issue, filing as “single” when he was at all times married to Ami. IRS doesn’t contend Fan was playing games, just that the correct MFJ return he and Ami filed after they petitioned Tax Court from the ensuing SNOD was too late to allow him the Section 6013(b) switch rather than fight. The SNOD treated Fan as filing MFS, clobbering him with $30K in tax and chop.

Fan and IRS settle out of the other year at issue, so all that’s on the table is whether Fan can rejoin the ranks of the righteous MFJs. If he can, he and IRS agree that the belated MFJ return, with a few tweaks, is A-OK.

Ex-Ch J Michael B (“Iron Mike, the Dictionary King”) Thornton has this one. Although Fan and Ami are Tennesseans and therefore in 6 Cir, the one 6 Cir case is a protester case where husband filed alternately as MFJ and MFS intentionally. Though IRS says “that settles it,” Ex-Ch J Iron Mike says it really doesn’t answer the question, because no one claims Fan was a protester or wiseguy. Likewise Fan didn’t file MFS first and then try to go MFJ.

This is clearly an honest mistake.

“Because the Court of Appeals for the Sixth Circuit has not decided the precise issue before us, and in the light of the recent reversal of this Court’s Memorandum Opinion in Ibrahim v. Commissioner, T.C. Memo. 2014-8, and the longstanding position of the Court of Appeals for the Fifth Circuit in Glaze, which is consistent with that of the Court of Appeals for the Sixth Circuit, we reexamine this Court’s holdings with respect to this issue.  Although mindful of the virtue of adhering to this Court’s long-established judicial holdings, we believe that the importance of reaching the right result and of promoting uniformity in the tax law requires that we carefully reexamine the issue before us.” 149 T. C. 13, at p. 12.

So while Tax Court is playing good shepherd, the Circuit Courts of Appeals are doing their “all we like sheep have gone astray, and have turned every one to his own way” number. And the iniquity of all of them has been laid on poor li’l ol’ Tax Court, to paraphrase a much higher authority.

“The term ‘separate return’ in section 6013(b)(1) is not defined in the Code or the regulations.  Considering the context of section 6013(b) as a whole, however, and giving due regard to the Courts of Appeals’ opinions in Ibrahim and Glaze, we think ‘separate return’ means a return on which a married taxpayer has claimed the permissible status of married filing separately, rather than a return on which a married taxpayer has claimed a filing status not properly available to him or her.” 149 T. C. 13, at pp. 12-13.

Of course, ex-Ch J Iron Mike can’t refrain from linguistic gyrations, so he cruises through Glaze and Ibrahim, parsing “election” and “separate” to restrict Section 6013(b) strictly to MFS types who are belatedly trying to get over to MFJ, or the reverse, or to wiseguys seeking to play games.

I do agree that you can’t “elect” an invalid option. “Election” means to choose between two possibilities, not to choose what doesn’t exist. If you’re married for the relevant portion of the year at issue, you file joint or separate, but not single.

And this case won’t upset all the learning on elections and how they’re binding.