It’s an odd coupling, but I’ve blogged it more than once. See, for example, my blogposts “Easy Rider,” 11/21/14, and “Rev Up Yer Engines!” 4/7/21. There must be something that attracts builders to racing vehicles.

Andrew Mitchell Berry and Sara Alexine Berry, 2021 T. C. Memo. 52, filed 5/5/21, starred in the second of the aforementioned blogposts. They have what they called on their Facebook page a “family drag racing team.” 2021 T. C. Memo. 52, at p. 6.

Although maybe it’s Andy and his dad, who own the Sub S construction company, who own the racing operation. Andy does win some money drag racing, but assigns the money to the Sub S, which also pays the (unsubstantiated) racing expenses.

Judge Kathleen Kerrigan finds this unavailing. It’s Andy’s money and his expenses.

“A taxpayer may not determine the nature of his or her income merely by using a particular form, or by labeling it as he or she wishes, but must report his or her income according to the economic realities of the situation.

“Petitioners contend that petitioner husband’s race car winnings should be included in Phoenix’s gross receipts. In support of this contention Mr. Berry testified that Phoenix paid the entry fees for petitioner husband’s car races. Petitioner husband testified that he raced under the name ‘Berry Racing’, which he described on his Facebook account as a family drag racing team. During the years in issue petitioner husband’s racing crew wore shirts emblazoned with ‘Berry Racing’.
The evidence does not show that car racing was part of Phoenix’s business.

“Because income earned by petitioner husband as a race car driver is not income derived from [Sub S]’s business of remodeling and construction, it should not be included in Phoenix’s gross receipts. “ 2021 T. C. Memo. 52, at pp. 6-7. (Citations omitted).

And while “comin’ off the line when the light turns green/ ya know he blows ‘em out of the water like ya never seen,” Andy is weak on paper.

IRS does give him some COGs for building permits, but not what he claims. Judge Kerrigan finds he double-counted some items.

Failure to keep records gives Andy a negligence chop.

And for any reader who asks why I give this much space to a more-or-less ordinary indocumentado, when I only picked up Judge Holmes’ off-the-cuff dismissal of tax-affected valuation analysis in the Michael Jackson case, I reply that I am writing for the in-the-trenches practitioner. The fine points of valuing at date of death the much-besmirched image of a popular music icon is not one that my readers, much less myself, are likely to encounter. You’ll notice my blogposts over the eight (count ‘em, eight) years I covered the case in Tax Court dealt with general procedural points the ordinary practitioner might encounter. I left the “rarefied heights of pure mathematics” and matters unique to the upper reaches of the music business to the blogoshere and trade press. Maybe some of those dudes will find themselves at those Olympian heights.