In Uncategorized on 09/20/2019 at 18:20

That’s not Judge James S (“Big Jim”) Halpern’s answer to Giorgio P. Martinelli, Docket No. 4122-18, filed 9/20/18, despite the 1982 Pavarotti musical.

Giorgio wants summary J that he doesn’t owe Section 6038D(d) hits for the Italian bank account brother Maurizio opened under a POA from Giorgio. And to keep IRS from grabbing the hits. Of course, the Section 6038D hits don’t involve either a deficiency (difference between amount stated on return and tax due) or any NOD.

Section 6214(a) avails Giorgio not. IRS can be enjoined only for Subtitle A and Subtitle B stuff, but Section 6038D is Subtitle F.

Giorgio claims he’s a mere nominee for Maurizio, and Maurizio has two (count ‘em, two) affidavits in almost idem verba that say so. Thus, says Giorgio, the interest and dividends earned on the accounts aren’t Giorgio’s, and therefore there’s no deficiency.

“We do not find petitioner’s or Maurizio’s declarations specific enough to negate the inference that, as the account’s owner, petitioner had the ability (whether or not exercised) to withdraw funds from the account without Maurizio’s approval. Neither petitioner nor his brother describes any terms or conditions on the account that would deny petitioner the usual rights of an account holder and prevent the Italian bank from honoring withdrawal requests from petitioner.” Order, at p. 6.

Giorgio claims he didn’t know about the account until after the year at issue. IRS says he did, but can’t introduce any facts to rebut Giorgio’s tale.

IRS should’a interpolated Rule 121(e), which says that if the only way of contravening affidavits is cross-examination, no summary J. But IRS didn’t.

Judge Halpern to the rescue. “Respondent did not invoke Rule 121(e) in his opposition to petitioner’s motion or accompanying memorandum of law. But he does claim repeatedly that he ‘should not be forced to take information contained in declarations at face value without the right of cross-examination of witnesses under oath.’ Those claims implicitly invoke Rule 121(e).

“We agree with respondent that he should be allowed to cross-examine petitioner about when he learned of the Italian bank account (as well as other matters in regard to which petitioner’s statements provide the only evidence). If petitioner did learn of the account’s existence before [year after year at issue], evidence of that fact may not exist and in any event would not be readily available to respondent. Denial of petitioner’s motion thus should not turn on respondent’s ability to produce evidence to that effect. Petitioner’s testimony about when he first learned of the Italian account may be the only available evidence of that potentially critical fact. Therefore, we will not accept petitioner’s testimony until respondent has had the opportunity to challenge it through cross-examination (and we have the opportunity to observe petitioner’s demeanor and judge his credibility).” Order, at p. 7.

Time for a trial.



  1. “Big Jim” likes your column, but he is James S not James B. Coincidently, there is a James B Halpern , a lawyer, in DC. We used to be in the same building. Made for a lot of confusion. Say hello from me to Joel Miller if you see him.

    Sent from my iPad


  2. Your Honor, I apologize. Error corrected. I hope to see Joel next week, and will convey your greeting.


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