In Uncategorized on 05/17/2019 at 16:35

Thomas L. Kitts & Amanda M. Kitts, Docket No. 5629-17, filed 5/17/19, echo the words of Hank Longfellow, but Judge Buch can‘t get them out of the stip they signed, apparently on the eve of trial last December, after they’d bounced an earlier one IRS proposed.

When IRS tries to enter decision, Thom & Amanda balk, because the numbers on the Form 4549B embodying the changes were not what they thought. Judge Buch was induced to hold a phoneathon, whereat IRS agreed to drop a number or two. IRS then moved to enter decision incorporating the agreed changes, whereupon Tom & Amanda moved to be relieved from the stip, claiming IRS misrepresented something. Clearly, Tom & Amanda didn’t like the numbers their stip yielded.

Nope, says Judge Buch.

“The Kitts did not provide any basis to support their claim of misrepresentation. The Kitts may have misunderstood the tax effect of their stipulation, but that unilateral mistake (assuming there was one) is not grounds to set aside the stipulation.

“A stipulation of settled issues is a compromise, and we are unlikely to grant relief from a stipulation entered into through considerable negotiation. The Kitts had the Form 4549B from the Commissioner’s initial settlement offer since at least April 2018. The Kitts were represented by their accountant who also had the Form 4549B before they entered into the stipulation. The parties freely and fairly signed the stipulation long after both parties were aware of what was at issue.” Order, at p. 3 (Footnotes omitted, but get the cases cited and be prepared for bombardment therewith if you ever need to avoid a stip).

The various IRS Manuals give taxpayers no rights. And if Tom & Amanda wanted a trial, that train has left.

And having your accountant represent you in Tax Court raises other and further questions, which I have elucidated more than once.

Remember my advice: Stipulate, don’t capitulate.

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