In Uncategorized on 04/11/2018 at 15:51

No, not the Lennon-McCartney classic; rather, one gets the feeling that Judge James S (“Big Jim”) Halpern has had enough of certain tactical manœuvres in this designated hitter, George E. Joseph, Docket No. 27759-15, filed 4/11/18.

Judge Big Jim gives George and counsel one (count it, one) day to respond to an IRS oral motion to bar testimony from the AO who, according to George and counsel, “re-performed the audit of taxpayer based on serious deficiencies apparent from the original audit.” Order, at p. 1.

So George wants to get the AO’s testimony.

Except trial is set for Tuesday, 4/17/18, date and time certain. And IRS’ counsel says the testimony is inadmissible and irrelevant.

Now my sophisticated readers will say “hey, deficiency cases are tried de novo, so who cares what IRS or Appeals did or didn’t do? The past is prologue. Let George and counsel prove the return or returns at issue are substantially correct.”

Judge Big Jim is a little more explicit.

“The gravamen of respondent’s objection is that any testimony by AO would be excludible under Fed. R. Evid. 408 as evidence of a compromise of the deficiency in tax determined by respondent. Also, respondent argues that petitioner bears the burden of proof, see Rule 142(a), Tax Court Rules of Practice and Procedure, and that AO’s testimony is not necessary or relevant for petitioner to meet his burden. Finally, the Court brought to the parties [sic] attention what the Court announced long ago in Greenberg’s Express, Inc. v. Commissioner, 62 T.C. 324, 327 (1974): ‘As a general rule, this Court will not look behind a deficiency notice to examine the evidence used or the propriety of respondent’s motives or of the administrative policy or procedure involved in making his determinations.’

“Also, the Court has looked at the petition and is somewhat at a loss as to what, other than matters precluded by Fed. R. Evid. 408, AO would testify to. Petitioner assigns error to respondent’s deficiency determination claiming: ‘The amounts filed in the filed returns are the correct numbers.’ In support of that assignment of error, petitioner avers in relevant part: ‘Although a significant tax liability remains, the numbers are correct and are not nearly as large as the numbers seemingly pulled out of the air by the auditor.’” Order, at pp. 1-2. (Name omitted).

Of course, George’s petition flunks the Rule 34 separately state and number clear and concise statements of facts relied upon test. And settlement negotiations can’t be introduced at trial.

So George and counsel have to unload the following on Judge Big Jim: “…an objection to respondent’s oral motion under Fed. R. Evid. 408 and also to respond to respondent'[sic] concerns as to the relevance of AO’s testimony and to our concern under Greenberg’s Express. He shall identify in particular the adjustments on the Form 4549-A attached to respondent’s notice of deficiency as to which he believes AO has knowledge. He shall specify the facts that petitioner relies on to show error in each of those adjustments. He shall identify what knowledge AO possesses of each of those facts. He shall identify how she obtained knowledge of each such fact.” Order, at p. 2. (Name omitted).

And they have to do this by close of business tomorrow, 4/12/18.

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