In Uncategorized on 04/18/2022 at 15:26

No, this is not another paean to Rule 121; Judge Courtney D (“CD”) Jones disfavors a summary of transactions proffered by Todd Kohout and Lisa M. Kohout, T. C. Memo. 2022-37, filed 4/18/22. The half-battalion of my combat-hardened veteran readers are fully conversant with FRE 1006. Where stuff is voluminous, so that it can’t be conveniently examined in court, the proponent of the stuff (that’s the side that wants it in evidence) can introduce charts, calculations, and summaries, provided same fairly summarize the stuff.

Todd did his own records, and maybe his return and that of his Sub S, but some records he changed after he prepared the returns, and some got lost when his computer crashed. So he hired a trusty CPA with Big Four experience to reconstruct records and summarize same. But the summaries characterized items, and the CPA “took ‘[Mr. Kohout’s] word for it’ when he would inform him of the nature of certain transactions.” T. C. Memo. 2022-37, at p. 9.

And some of the characterizations are belied by the record.

Judge CD Jones exercises her judgment, and summarily bounces the summaries.

Todd also amended his petition after he entered into two (count ’em, two) stips of settled issues, to claim he overstated receipts by more than the deficiency, and that he had enough basis in the Sub S to take better than $100K of losses. Needless to say, the record supports none thereof.

Takeaway- Courts love summaries…if they are summaries.


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