Josefa Castillo, 160 T. C. 15, filed 6/5/23, got her filing fee waived when she petitioned her CDP NOD. But she petitioned after the 30-day Section 6330(d)(1) cutoff, so then-Ch J Maurice B (“Mighty Mo”) Foley bounced her petition for being 249 (count ’em, 249) days late.

But that was back in March, 2020, pre-Boechler.

Josefa’s trusty attorney, the redoubtable Elizabeth (“Prof. Liz”) Maresca, CO of the Fordham University Law School LITC, nowise daunted, appeals to 2 Cir, which puts everything on hold as by that time Boechler was climbing its way to the Supremes.

You know the rest. The Supremes bring “discipline and order” to Congress’ wayward view of jurisdictional and nonjurisdictional defects. Whereupon 2 Cir reverses and remands Josefa back to Tax Court. IRS folds everything, the year at issue being nine (count ’em, nine) years ago.

So after a wee high-five on 65th Street, Prof. Liz goes for Section 7430 admins and legals. I don’t know much was at stake in Josefa’s case, but if she qualified for Fordham’s LITC, I doubt they had to round to the nearest dollar, much less omit the last three zeroes. But the Fordham LITC’s meter stopped at $5,601 admin and $129,750 for legal.

Ch J Kathleen (“TBS = The Big Shillelagh”) Kerrigan sees off Prof. Liz and her hungry acolytes. Prof. Liz and her crew did behave well. “She did not unreasonably protract the proceedings, the amount of the costs requested is reasonable, and she exhausted the administrative remedies available. The parties disagree as to whether petitioner should be treated as the prevailing party.” 160 T. C. 15, at p. 4.

As for the reasonableness of the legals, without knowing the issues, the amount in controversy, the novelty of legal issues, the time expended (and how and by whom it was expended) and the expertise of the attorneys involved, I can’t comment. But the fact that IRS folded makes me wonder just how big and tough a case it was.

Howbeit, substantial justification is still at issue. At the time the answer was filed, was IRS justified in its position?

“Respondent’s litigation position—which was first raised in the Answer—was that the Court lacked jurisdiction because the Petition was not timely filed. There is no dispute that the Petition was filed late.  Respondent argues that because the law was clear then that a timely filing was necessary to establish the Court’s jurisdiction, the Commissioner was substantially justified in asserting that the Court lacked jurisdiction. We agree with respondent.” 160 T. C.15, at p. 5.

“Before the Supreme Court’s decision in Boechler neither the Tax Court nor the federal courts of appeals had held the 30-day period in section 6330(d)(1) to be nonjurisdictional. Because Boechler was a matter of first impression for the Supreme Court, respondent’s position was substantially justified.” 160 T. C.15, at p. 6.

But Prof. Liz isn’t done. “Petitioner argues that respondent’s position should be presumed not to be substantially justified because respondent did not follow guidance provided in the Internal Revenue Manual(IRM). See § 7430(c)(4)(B)(ii). The presumption in section 7430(c)(4)(B)(ii) does not arise here because the IRM is not ‘applicable published guidance’ within the meaning of the statute. Section 7430(c)(4)(B)(iv) defines “applicable published guidance’ exhaustively as ‘regulations, revenue rulings, revenue procedures, information releases, notices, and announcements, and . . . any of the following which are issued to the taxpayer: private letter rulings, technical advice memoranda, and determination letters.” Since the IRM is not included in this list, the presumption does not arise.” 160 T. C. 15, at p. 6.

Another silt-stir bites the dust.