I’ve often blogged Judge David Gustafson’s obliging nature; see, e.g., my blogposts “Obliging? This Beats All,” 3/6/19, and “Obliging – Even Though He’s Only Passing Through,” 8/10/18. Today, however, Judge Courtney D. (“CD”) Jones is much less obliging.

Unlike Judge Gustafson, she won’t help out IRS’ counsel, as IRS’ summary J motion prevails only in part, in Paul Edwin Johnson, Docket No. 16077-19, filed 6/28/21. Paul Edwin is a candidate for a Section 6673 chop, but his petition is timely and he loses the deficiency. So he only gets the yellow card.

Judge CD faults IRS counsel on misplaying the Boss Hoss underpinning of the Section 6662 accuracy chop they bestowed on Paul Edwin.

The AUR issued a CP2000 to Paul Edwin, when his retirement drawdown hit IRS’ computer but missed Paul Edwin’s 1040. Paul Edwin replied to the CP2000.

“…the AUR program received a response to the CP2000 Notice from Mr. Johnson in which he appeared to agree with the changes but argued that he should be eligible for increased credits. … CW, an AUR Tax Examiner, considered Mr. Johnson’s response to the AUR and found that he was eligible for increased credits but determined that the IRS should impose a penalty. JB was CW’s immediate supervisor and approved, in writing, CW’s initial determination of the penalty….” Order, at p. 7. (Names and dates omitted).

So the AUR issued the SNOD with the accuracy chop in it.

Now comes a silt-stir that would gladden Judge Holmes’ heart.

“Respondent contends that respondent obtained supervisory approval prior to the issuance of the notice of deficiency…and the record seems to support this conclusion. But it appears to the Court that the CP2000 Notice… was the IRS’ first formal communication of the initial determination to assert penalties pursuant to section 6662(a). Therefore, respondent has the burden of production with respect to its compliance with section 6751(b)(1) regarding the CP2000 Notice, not the notice of deficiency. As there is no evidence in the record to support that written supervisory approval was obtained prior to the issuance of the CP2000 Notice, we hold that there is a genuine dispute of material fact regarding whether respondent carried respondent’s burden of production pursuant to 6751(b)(1) with regard to the section 6662(a) penalties for this case.” Order, at p. 6 (Citation and footnote omitted, but the footnote says it all).

OK, so my ultra-sophisticated readers all just shouted “Section 6751(b)(2)! AUR untouched by human hands! Boss Hoss irrelevant!”

Now for everybody else, here’s Judge CD being unobliging.

“We note that it appears that the CP2000 Notice was issued through the AUR program. Managerial approval pursuant to sec. 6751(b)(1) is not required for penalties calculated through electronic means. See sec. 6751(b)(2)(B); It is curious that respondent did not address the potential application of sec. 6751(b)(2)(B) to this case, but we will not argue it for him. See Rule 151(e)(5). As we have said before, our job is to consider the issues advanced by the parties, not to craft alternative arguments never raised.” Order, at p. 6, footnote 5. (Citations omitted).

Takeaway- As IRS’ resources are stretched without further Congressional appropriations, expect more computerization to replace humanity, and perhaps unhorse the Boss Hoss.