I don’t know if Judge Courtney D. (“CD”) Jones is a Blake Shelton fan, but she’s telling Appeals that Austin is what matters. And that’s especially true when NEH-ETA is the flavor du jour, as in Randine Bickel, a.k.a Melba Schoolfield, Docket No. 22038-22L, filed 8/29/23.

Randine’s is a sad tale, a nogoodnik ex-husband who cons her into getting them a CO pottery license and grabs the gelt, leaving Randine with an astronomical tax bill because Section 280A anti-pottery. And Randine is depressed, drug-addicted, and otherwise incapable, although she’s got better than half-a-million to cover $306K tax and chops. Her OIC on non-economic hardship-effective tax administration (NEH-ETA) was $1K. Appeals bounces, and IRS moves for summary J sustaining.

Randine has a trio of trusty CO pot-wise attorneys, whose lead I’ll call Nic. Nic has the knack, urging Appeals at the CDP “to reevaluate the OIC on non-economic hardship (NEH) ETA grounds, and specifically regarding public policy and equity considerations. Ms. Bickel also stated that the OIC should have been forwarded to the special group in Austin, Texas that handles NEH-ETA offers (Austin Group).”  Order, at p. 6.

Now I didn’t know that either, so apologies to my ultra-hip readers who memorized IRM 5.8.11.3.2 – Public Policy or Equity Grounds  – in childhood’s earliest hour. But Judge CD Jones apostrophizes the Austin outfit, and bounces IRS’ summary J motion to sustain the NOD.

“The IRM provides that ‘[a] taxpayer who has submitted an offer under NEH-ETA or has requested consideration of any public policy or equity issues during the offer investigation must have those issues reviewed by the NEH-ETA group prior to rejection of the taxpayer’s offer or before a rejection is sustained.’ IRM 5.8.11.5.1(8) (Oct. 4, 2019) (emphasis added). After the Austin Group considers the public policy and equity issues, the group manager of the Austin Group must either explain why the taxpayer’s offer cannot be investigated or request that the matter be transferred to the Austin Group. IRM 5.8.11.5.1(5) (Oct. 4, 2019).” Order, at p. 12. (Emphasis by the Court).

Appeals knew they had to go to Austin, but held up because they didn’t calculate Randine’s life expectancy when they did the numbers, and all open matters have to be decided before sending the file to Austin per IRM 5.8.11.5.1(7) (Oct. 4, 2019). Appeals did a back-and-forth with the AO and his boss, and didn’t send Randine to Austin.

Judge CD Jones gives IRS a chorus of the Hot Country 100 special of 2001.

“… we cannot conclude that AO M did not abuse his discretion. As we have explained above, the record is devoid of an explanation regarding Ms. Bickel’s NEH public policy and equity arguments—including why the matter was not sent back to the Austin Group as required by the IRM and recognized by AO M—which frustrates the Court’s ability to discern Appeals’ reasoning and properly review its determination.” Order, at p. 13. (Citation and name omitted).

Remanded for Appeals to explain. I suggest the supplemental CDP include a trip to Austin.

Because as Nic might say, if this is Austin, I still love you.