In Uncategorized on 06/29/2018 at 15:43

It’s been five years to the day, near enough, that I first entitled a blogpost with this tagline from Harry Golden, journalist and raconteur. So at the risk of prolixity, but given the lapse of time, I’ll retell this thrice-told tale.

An immigrant finally attained citizenship. After the swearing-in, he stoutly refused to understand, much less speak, his native tongue. He spoke only broken, heavily-accented English. When his wife of many years addressed him in the language they had shared throughout their lives, he turned to his US-born and educated children and asked them “Vot did she set?” Whereupon his wife called down upon his head maledictions unknown even to scholars of their childhood language, but which connoisseurs hastened to extol as masterpieces of invective.

Well, on this torrid Friday, with the usual want of opinions, I turn to that Obliging Jurist, Judge David Gustafson, who has provided yet another opportunity to repeat Harry Golden’s anecdote.

Judge Gustafson has many a time and oft helped the hapless and feckless petitioners who flounder and founder in the toils of US Tax Court. Now he turns his benevolent attention to Appeals, and one little word from a Supplemental NOD that befuddles him.

Here’s James Houk and Marsha Houk, Deceased, Docket No. 22140-15L, filed 6/29/18. This is not the first time Judge Gustafson has to serve as drafter in this case; see my blogpost “Obliging? He’ll Rewrite Your Papers For You,” 2/28/18.

Well, we all know the fastest way to get something done is to give it to someone who is very busy.

Jim went back to Appeals to fight over his self-reported liability, and handed in an amended return. Appeals issued a supplemental NOD. So maybe Appeals bought the revised version. Maybe not.

“However, we cannot tell the exact meaning of the supplemental notice and the determination that it states. The supplemental notice states that Appeals ‘made the determination to adjust your account to the amended return filed to correct the amount of taxes you now owe. The Appeals Officer submitted the Form 3870, Request for Adjustment for an abatement of prior tax assessment in the amount of $7,369.00.’ This might mean that the total original assessment was $7,369 and it has all been abated, but the supplemental notice elsewhere states that the ‘Settlement Officer informed [Mr. Houk] that if there’s still a balance due we would have to discuss a collection resolution.’ That ‘if’ leaves us uncertain. Since the supplemental notice states that it ‘supplements the Notice of Determination…,’ that might mean that it leaves standing the prior determination in the … notice that ‘the proposed levy action is the appropriate action in this case’, or perhaps silence about the levy might mean that the levy will not be necessary and is not sustained.

“As far as we can tell, the record in this case so far does not include either the Houks’ original return or their amended return, and the record does not show what the amount of their originally assessed liability was, nor what the adjusted liability is, nor how much of that adjusted liability remains unpaid.” Order, at p. 2.

Charging boldly, IRS moves for entry of decision per the supplemental NOD. And Jim agrees that he’s made a deal with IRS.

 “However, it [IRS’ motion] proposes no explicit decision embodying the resolution of his liability challenge, and it does not state explicitly whether there is an unpaid balance that would warrant the sustaining of the levy.” Order, at pp. 2-3.

“In the supplemental notice issued here, Appeals determined that the Houks’ … tax liability should be reduced by $7,369, but it does not state what that adjusted liability is nor whether it has been paid in full. Moreover, the supplemental notice purports to sustain the proposed levy, but we cannot tell whether there is any unpaid portion of the … liability to make the levy appropriate.

“We will therefore order that the motion for entry of decision be supplemented and be accompanied by a revised proposed decision document that sufficiently resolves the issues in this case.” Order, at p. 3.

To enter decision in a deficiency, there has to be a number. To enter decision sustaining a levy, there has to be a sum certain that would satisfy the levy.

And Judge Gustafson even obliges me, poor as I am, by taking up a pet peeve of mine.

“Sometimes a CDP hearing addresses a lien notice (see section 6320), sometimes a levy notice (see section 6330), and sometimes both. Presumably for that reason, IRS Appeals has developed “and/or” letters and forms that are intended to serve in all three of those circumstances. That approach sometimes causes confusion.” Order, at p. 4.

Judge, roger that. MFA, as we used to say. That stands for “Most Affirmative,” the “F” being for emphasis.

“Indication whether the notice addresses a lien or a levy or both does not appear on the first page. Lawyers and judges know to look on subsequent pages to find references to “lien” (or “NFTL” or “6320”) or “levy” (or “NOIL” or “6330”) or both, but we think that people of ordinary intelligence who do not have tax training and who have previously received both a lien notice and a levy notice and have requested CDP hearings for both (apparently not Mr. Houk’s circumstance) must find this confusing.” Order, at p. 4.

Worse, both the NOD and the supplemental NOD both contained this sentence : “There was a balance due when the Notice of intent to Levy was issued or when the NFTL filing was requested. [Emphasis added.]” Order, at p. 4. (Emphasis in original).

This is obvious boilerplate, because here only a NITL (Judge Gustafson prefers “NOIL,” and I won’t quibble) is involved. That said, “…when one sees this unedited sentence, one knows that it was not composed to address the actual circumstances of the case then before Appeals. One assumes that someone at Appeals actually did address the question whether there was a balance due when the notice was issued, but one dislikes assuming. (And in this case, in its current posture, the question whether there remains a balance due is a very good question, for which an answer in the supplemental notice would have been helpful.). “Order, at p. 4. (Emphasis by the Court).

Now you may say I’m trying to curry favor. I protest I am not, but when a judge writes a sentence like this, ya gotta love it.

“It appears this case is headed for settlement, in which event all is well. But we cannot endorse the ‘and/or’ approach reflected in IRS Appeals’ notices.” Order, at p. 5.


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