Judge Ronald L. (“Ingenuity”) Buch need expend little of his ingenuity in Warner Enterprises, Inc., T. C. Memo. 2022-85, filed 8/22/22. Warner is fighting a CDP over Boss Hossery. Warner was a partner in the ill-fated James (“Little Jim”) Haber dodge AD Investment 2000 Fund, and when the partner-level fallout from the TEFRA FPAA blow-up rained down on Warner, they sought a CDP. IRS claimed issue preclusion, because the chops at issue had been decided back in 2015 at partnership level per TEFRA; see my blogpost “Haber-Dashery,” 11/19/15, and  “The Tossed Witness,” 12/14/16.

Warner’s trusty attorneys could not find a case where a Court had decided the penalties final beyond appeal, where the Section 6751(b) Boss Hoss sign-off was revisited.

Judge Buch: “…Warner overlooks section 6330(c)(2)(B), which, like section 6330(c)(4), limits the issues taxpayers may raise at a collection hearing. Section 6330(c)(2)(B) precludes a taxpayer from challenging the underlying liability if the person received a notice of deficiency for, or otherwise had a prior opportunity to dispute, such liability. Warner had just such an opportunity in AD Investment Fund’s partnership-level TEFRA proceeding to which it was a party and in which it had a right to participate. See §6226(c).” T. C. Memo. 2022-85, at p. 6.

And Tax Court has no authority to review its previous final decision. If unhappy, timely appeal.

OK, but this is history, and has been since the Bipartisan Budget Act of 2015. That said, I doubt the result would be different were the facts of this case to arise under the new régime. The takeaway for any partner is to monitor all communications from the representative, and be prepared to defend yourself, by yourself.