In Uncategorized on 12/19/2022 at 15:37

Not the corporate type, rather the drafting boilerplate we all learned in Law School Year One: “This Agreement [Mortgage][Deed][Contract] sets forth the entire agreement of the parties hereto. This [ditto] may not be modified, amended, or canceled, nor may any provision hereof be waived, otherwise than in writing and signed by the party against whom said modification, amendment, cancellation, or waiver is asserted.”

Except somebody blew it in Kenneth M. Brooks and Anita Wolke Brooks, T. C. Memo. 2022-122, filed 12/19/22. And Judge Wells is all over it. This is another GA boondockery.

Yes, a deed can serve as a contemporaneous written acknowledgement that a transfer is gift if it states no consideration or merely nominal consideration. But while that’s necessary, it isn’t sufficient. “…silence in a deed serves as the CWA that the donee provided no goods or services as consideration, in whole or in part, only if the deed also qualifies that the terms of the deed are the entire agreement.” T. C. Memo. 20223-122, at p. 11.

Note that the ten dollars and other good and valuable consideration is mere boilerplate, and ignored.  Somebody let poor Randy Schrimsher know. See my blogpost “Valuable Consideration?” 10/3/12.

Ken’s and Anita’s appraisal is a wee bit dodgy, both as to description of the property and its development potential if rezoned. And the Form 8283 states a cost basis for property other than the donated parcel in addition to that of the donated parcel.

IRS gets to wildcard in a CPAF seven (count ’em, seven) days before trial, despite the 14-day rule to stip to documents per the SPTO. Judge Wells says “no hurt no foul.”

“Petitioners did not raise compliance with section 6751(b)(1) before or, substantively, during trial and nevertheless received the form before the record was closed. It is therefore even more appropriate to accept the form into evidence..” T. C. Memo. 2022-122, at p. 18.

Taishoff says the burden is on IRS. Congress placed it there. Letting in wildcards is sharp practice and shouldn’t be allowed.  But Judge Wells is the judge, so Ken and Anita get the 40% gross valuation misstatement chop.

Ken and Anita lived in VA when they petitioned, so this one goes to 4 Cir, not 11 Cir. Should be an interesting appeal, if they take one. Don’t undertake to follow it, though.


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