I’m obliged once more to Dickens for the title of this blogpost. Karen D.Foxx, Docket No. 17625-19, filed 1/11/21, got two different W-2s for the same year from her employer, each showing different wages.

Seems Karen wasn’t the only employee of the Nebraska Urban Indian Health Coalition (NUIHC) thus embrangled, but she didn’t respond to the CP2000. Her boss, however, timely submitted some correspondence that explained Karen’s fix. This was treated as a petition; Karen was ordered to ratify, but it’s not clear she did. After the petition arrived at Appeals, IRS dropped any claim for tax or chop, and sent Karen decision docs so stating.

I won’t get into the issue whether the CEO of NUIHC is entitled to enter a Tax Court appearance when NUIHC is not the taxpayer. Karen’s story would end here, but for the arrival of an attorney, whom I’ll call Mikey. Mikey files Entry of Appearance, has a couple phonecalls (hi, Judge Holmes) with IRS, and gets new decision docs naming him as attorney.

These get signed off in less than three weeks. Mikey then asks for admins and legals of $6800.

“In this case, the IRS received third-party information that petitioner received two Forms W-2 from NUIHC – one reporting wages of $36,750 and another reporting wages of $50,350. In light of this information, respondent was justified in seeking clarification from petitioner regarding whether she received wages of $36,750 that she failed to report…. Unfortunately, petitioner failed to provide information to respondent to assist in resolving these questions, leading to the issuance of the notice of deficiency.” Order, at pp. 3-4.

So IRS is justified. When there are facts involved, IRS is entitled to time to get the facts, review what substantiation is proffered, and reach a result. Here IRS acted reasonably.

STJ Panuthos is his usual genteel self. “Although respondent contends that the claimed litigation costs are unreasonable, we need not resolve that question in disposing of this motion.” Order, at p. 3, footnote 2.

Even though Mikey’s involvement predates COVID-19, hard times are no excuse for this.