In Uncategorized on 06/09/2021 at 16:16

Michael B. McCullough, Docket No. 10636-19, filed 6/9/21, shoots the rapids of the “goofy regulation,” carrying with him enough receipts and credible testimony both to sustain the bulk of his COGS and deductions, and to avoid any accuracy chops.

Mike had forty (count ’em, forty) years in as an interior designer. For the years at issue he had his own business, and worked only for customers for whom he’d worked for years.

Judge Kathleen Kerrigan gives us an off-the-bencher, in which she skates through the factors, as Mike was a CA resident when he petitioned, and 9 Cir. maybe doesn’t follow Judge Posner.

“Petitioner had four decades of experience in interior design. His business stemmed from his past experiences and prior relationships. He worked at his interior design business full time. Even though he testified that he did not have a written business plan, he had one in his mind which he executed. His plan was to do projects for prior clients and obtain new work based on client recommendations. From his past experiences, he knew that he could have enough business without advertising.” Transcript, at p. 8.

For a dozen years pre-pandemic, that was how I operated. And I’ll wager a couple ales at Jake’s Saloon that I was not the only one.

“Because we mostly decide for petitioner, we conclude that petitioner is not liable for the section 6662(a) penalty for [years at issue].” Transcript, at p. 9.

I note Mike did discovery and tried the first half of this case his own self, but brought in counsel for the rest. Good move, Mike. Good Job, counsel.


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