In Uncategorized on 09/21/2018 at 17:18

This is an old gripe of mine, but it needs to be refreshed and rebooted. Today, Alfred P. Ray & Hazel Carla Ray, Docket No. 13535-18, filed 9/21/18, provide me with my launchpad.

Alf & Hazel had separately petitioned two other years, with cases pending. They want to consolidate the year at issue with these, so they argue against IRS’ motion to dismiss for want of jurisdiction “…that because they have received a multitude of notices from the Internal Revenue service, presumably the including the CP2000 they provided to respondent, the Court should impute a notice of deficiency, invoke jurisdiction, and consolidate this case with their above-mentioned cases….” Order, at pp. 1-2.

Here’s Ch J Maurice B (“Mighty Mo”) Foley to tell Alf & Hazel the bad news.

“Petitioners have not established their burden with respect to [year at issue]. A Notice CP 2000 is a notice to taxpayers that the IRS intends to make changes to the return and invites the taxpayers to either agree or disagree. It is not a notice of deficiency. See I.R.C. sec 6313(b)(1)[sic; I think you meant 6213(b)(1), Judge]. Moreover, the taxpayer has no right to file a petition with the Tax Court based on such a notice, and the IRS is not prohibited under I.R.C. sec. 6213 (a) from collection activity. Id. Likewise, if a letter notice is not a notice of deficiency, then the Court lacks jurisdiction.” Order, at p. 2.

OK, Ch J, if it’s simply a numbers mistake, then Section 6213(b) rules. Likewise if it were a criminal restitution or claim-of-right carryback.

I’ve already ranted about IRS’ doublewide definition of “clerical” mistakes. See my blogpost “Manifest Injustice,” 5/4/18. I hope the taxpayer filed for a refund and won. Or that Nina E (“The Big O”) Olson laid a class-A whuppin’ on IRS.

And what about the Letter 4313C game, where the letter says there was a SNOD already issued, but IRS later says “Haha and hoho, fake out, no there wasn’t”?

There’s no mandatory form the SNOD must take. And the statute doesn’t mandate any.

“The notice [SNOD] ‘is only to advise the person who is to pay the deficiency that the Commissioner means to assess him; anything that does this unequivocally is good enough…. [M]istakes in the notice which do not frustrate its purpose, are negligible.’ O’Rourke v. United States, 587 F.3d 537 (2nd Cir. 2009), quoting Olsen v. Helvering, 88 F.2d 650, 651 (2d Cir. 1937).

So how is a civilian, unlearned in tax law, to know what is and what is not a SNOD, and whether or not s/he is in peril if s/he doesn’t blast in the sixty bucks and a petition to The Glasshouse?

Can IRS play cutesy with Alf & Hazel, litigate the other years separately to see how they come out, and leave Alf & Hazel hanging until IRS decides to drop a SNOD for the year at issue (assuming no SOL issue)? And claim issue/claim preclusion when Alf & Hazel petition the belated SNOD?

Apparently IRS can.

So everyone should petition everything except that which says in plainest English “two plus two is four, not three, dodohead.”

Or maybe IRS can decompose some brain tissue and do what I suggested a year ago in my blogpost “Should You Petition Everything?” 8/15/17.

“IRS can solve this simply. Atop everything they want to assert is a SNOD, put these words in bold-faced capital letters: STATUTORY NOTICE OF DEFICIENCY: PETITION TAX COURT, NOT IRS, IN 90 DAYS FROM DATE BELOW. SEE NOW.”


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