As IRS’ “highly contestable readings of what it means to be perpetual,” its dubious readings of odds and ends of TEFRA, and the APA battering at its Regs, goes on apace, IRS is thrown back on the appraisal joust as its point d’appui in the Dixieland Boondockery wars.

And the never-say-die approach of the trusty attorneys for Lake Jordan Holdings, LLC, Lake Jordan Partners, LLC, Tax Matters Partner, Docket No. 16532-21, filed 7/17/23, keeps both Judge Patrick J (“Scholar Pat”) Urda and this hardlaboring blogger hard at it.

IRS, fresh from last week’s no-score scuffle over the Laker’s TEFRA Section 708 termination (see my blogpost “No Storming This Bastille,” 7/14/23), is trying to insert the testimony of Kelli Friday, Chief Appraiser of Elmore County, whereat lies the Lakers’ dilithium-crystal-laden boondocks with its $12.74 million conservation easement deduction.

The Lakers yell “Foul!” claiming Kelli is playing the expert without complying with Rule 143(g).

Kelli will bukh about “1) the price-per-acre value of land in Elmore County as determined by the county’s Revenue Commissioner and (2) the valuation methodology the county used for tax assessments.” Order, at p. 1.

Now we all know the relevance of the tax assessments to the actual value of the land varies widely. See my blogposts “Quanto? Lo Prezzo,” 7/24/12, and “From Coast to Coast,” 5/8/17.

Judge Scholar Pat is willing to listen to Kelli, so he won’t now bar her testimony (as the Lakers want), but if she steps over the line and tries to value the Lakers’ property, she’s out.

“From our current distance, it appears that the established price-per-acre value of land in Elmore County (as determined by the Revenue Commissioner) and a description of the county’s valuation methodology would constitute permissible lay testimony – assuming arguendo that the Commissioner could establish the relevance of this information. If Ms. Friday’s testimony strays into expert opinion as to valuation of the property at issue in this case, we would expect to sustain an objection as improper expert testimony in contravention of Rule 143(g).” Order, at pp. 1-2.

Cash-strapped IRS wants to avoid expensive experts. Watch for similar moves.