I agree with the old Midwesternism “I don’t chew my cabbage twicet.” But for me, that means “twicet in the same place.” So here is an echo of my very brief spiel last evening to the Joint ABA/NYSBA Subcommittee on Taxation of Cooperatives and Condominiums.

This is of interest to tax advisers to sponsor/developers of phased or larger-scale Homeowners’ Association or Condominium projects. These are also part of the communities we serve, although our primary focus is on individual owners, sellers and buyers, and lenders, and Boards of Managers or Directors.

The materials on which I base these remarks are found in my blogpost “Rev. Proc. 2023-9,” 4/25/23. You can read these for yourself. My pet peeve is those CLE presenters who drone on, reading their written materials to us attendees, as if we were functionally illiterate. Presumably we attorneys and CPAs can read English, and maybe even understand what they read. Tell me what’s written between the lines.

There was a lot wrong with old Rev. Proc. 92-29; the intro to Rev. Proc. 2023-9 lists them in extenso. The two I focus on are the burdensome reporting and recordkeeping requirements, but worse is the mandatory extension of SOL, which is not limited to matters concerning the amenities, but to the entire project and the operations of the taxpayer generally. I know of no developer who availed themselves of this farrago. In fact, neither Tax Court nor 9 Cir mentions this Rev. Proc. in Shea Homes. I wonder if IRS’ counsel even mentioned it in their pleadings.

I note that, at page 9 of Rev. Proc. 2023-9, IRS speaks of any reasonable method of defining the project. Is IRS tacitly abandoning its fight against Shea Homes, notwithstanding AOD 2017-03?

Howbeit, I suggest you analyze Rev. Proc. 2023-9, if your practice involves sponsor/developers. I’d be interested to hear what that advisory community has to say, specifically, how many developers are likely to avail themselves of the safe harbor offered thereby.

Finally, a morning-after thought. Maybe IRS will keep AOD 2017-03 alive as a weapon against the envelope-pushers who try to abuse Shea Homes.