In Uncategorized on 09/08/2020 at 16:21

No, not those from a much more exalted authority than even United States Tax Court. Rather, today Judge Albert G (“Scholar Al”) Lauber is engaged in a dictionary chaw over “petitions and requests filed or pending” from the post-7/1/19 Section 6501(e)(7), in Donna M. Sutherland, 155 T. C. 6, filed 9/8/20.

Donna signed off on a couple delinquent MFJs (hi, Judge Holmes) as her spouse was being sentenced. Donna says she was emotionally confused, and even though she had no independent liability, thought she had to sign. She did file innocent spousery, but didn’t check the mental-or-physical-problems box because she thought she needed a doctor’s note.

She got bounced, and went to Appeals, but her representative was convinced the AO would misapply the Regs. and NOD the bounce, so rather than put in all the evidence at Appeals, Donna went for the pre-amendment de novo review and petitioned pre-amendment. Now Donna wants to put in the missing evidence, but based on the amended Section 6501(e)(7) “newly discovered” rule, she can’t. So she wants remand to make it clear she can put into the administrative record all the evidence her representative didn’t put in.

Judge Scholar Al has to decide if the Section 6501(e)(7) amendment applies. Remember, Donna petitioned pre-amendment, but obviously her case isn’t yet decided.

In previous post-amendment cases effective date didn’t matter, so this is first impression, thus full-dress T. C.

“On its face the effective date provision is ambiguous. ‘[P]etitions or requests filed or pending’ could mean ‘petitions filed or pending, or requests filed or pending.’ Alternatively, it could mean ‘petitions filed or requests pending.’ If the former reading is adopted, so that ‘pending’ modifies both ‘petitions’ and ‘requests,’ subsection (e)(7) likely would apply here because this case was pending in this Court when the amendment was enacted. If the latter meaning is adopted, so that ‘pending’ modifies only ‘requests’ and ‘filed’ modifies only ‘petitions,’ subsection (e)(7) would not apply. Petitioner’s request for innocent spouse relief had been resolved by the IRS, and hence was not ‘pending,’ on or after July 1, 2019. And her petition to this Court was filed before that date.” 155 T. C. 6, at p. 10.

I’ve said it so often: a lawyer who can’t find an ambiguity should find another way to make a living.

“This is an example of structural (also called syntactic) ambiguity. It arises where a sentence is susceptible to more than one meaning because of the way the words or phrases are organized. Clues to the meaning of such sentences can be supplied by the context and by other linguistic and interpretive tools.

“For example, assume a municipal ordinance that is effective for ‘cars or boats parked or docked’ at a city marina after a specified date. This provision would logically be interpreted to refer to ‘cars parked or boats docked.’ That is because each adjective comfortably modifies only one noun.

“On the other hand, assume a sales tax that is effective for ‘cars or trucks sold or leased’ after a specified date. Unless the context suggested otherwise, this provision would likely be interpreted to refer to ‘cars sold or leased, or trucks sold or leased.’ Both adjectives comfortably modify both nouns, and it would be odd to have different tax treatment for similar transactions involving similar vehicles.” 155 T. C. 6, at pp. 10-11. (Citation omitted).

Judge Scholar Al goes for the second reading. It’s “requests pending” and “petitions filed.”

I’ll spare you the linguistic anfractuosities, because Judge Scholar Al, scholar though he may be, is a practical lawyer.

“But if subsection (e)(7) were to apply to cases such as this–where the conclusion of the administrative process and the filing of the petition both preceded July 1, 2019, but the case remained pending in this Court thereafter–a sort of ‘gotcha’ could occur. The taxpayer would have gone through the administrative process believing that the scope of review in this Court was de novo. But she would then learn, once the time came for trial, that the scope of review was not de novo and that she could be prejudiced for not having made a more complete administrative record.” 155 T. C. 6, at pp. 16-17.

No need for remand. Donna can put it all in on the trial.

Those are the real comfortable words.









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