Even though Judge Patrick J (“Scholar Pat”) Urda demonstrates a greater familiarity with the contemporary music scene than I (I didn’t know that Michael R. Stevenson is “a very successful rapper who goes by the stage name Tyga,” T. C. Memo. 2023-115, filed 9/11/23, at p. 2), he cannot replicate Jack Lemmon’s differently-spelled Oscar-winning performance.

Tyga consistently fails to pay estimateds, while running up north of $8 million in taxes, add-ons, and chops. The SO keeps giving Tyga’s representative extensions to come up with the current 1040-ESs, but to no avail.

“Against this long backdrop of oft-fruitless accommodation, we cannot fault the settlement officer for ultimately determining that enough was enough. The settlement officer was within her discretion in denying another extension of time and rejecting any collection alternatives for lack of compliance with estimated tax obligations.” T. C. Memo. 2023-115, at p. 8. (Footnote omitted, but see infra, as my high-priced colleagues say.)

True, the SO didn’t consider the CA Tyga’s representative put forward. And she reviewed Tyga’s Form 433-A and back-ups herself, rather than bucking them over to Collection. No matter, says Judge Scholar Pat.

“We note in passing that the settlement officer acted in accord with the relevant IRM provisions in proceeding to consider Mr. Stevenson’s financial wherewithal after not receiving a response from the Collection Division. See IRM 8.22.7.4.1(2); (“A settlement officer does not abuse her discretion when she relies on relevant [IRM] provisions in evaluating collection alternatives.”) T. C. Memo. 2023-115, at p. 8, footnote 6. (Citation omitted).

I’ll forgive Judge Mark V (“Vittorio Emanuele”) Holmes a little lame humor in Short Stop Electric, Inc., T. C. Memo. 2023-114, filed 9/11/23. Bob, the majority stockholder in Short Stop, is an inventive type, so his story is worth some furbelows.

Short Stop was a C Corp, so double taxation. Bob decided to short circuit that (sorry, guys) by creating a “revolving line of credit” between himself and Short Stop, whereunder at year-end he’d note an advance on Short Stop’s books from him, and note a repayment with interest at a rate and amount determined solely by him. He’d pay tax on the interest he never got on his 1040 MFJ, but Short Stop’s 1120 would show minimal tax or a loss.

Bob was warned at an earlier exam that this was a dodge, but he seemed so earnest that the RA let it go. No good deed goes unpunished, so Bob kept right on with it. That earns him understatement chops.

Bob’s dicey loan to an unrelated fails for want of evidence; he claims Short Stop made the loan, but the borrower paid Bob. True, directing one who owes you to pay to one whom you owe is income to you, but there’s no showing of any of that. And the purchase of the cabin on the lake, ostensibly for future development, fails for want of proof of business use, as does the boat.

It’s true, as I once remarked, a sign of success is to own a boat. I never did.

And Short Stop’s NOLs get lost when the interest deductions it took get wiped out.

Fighting the chops, Bob’s CPA, though expert, has poor memory and no paper.

But Short Stop wins on the forklift, which survives even the Section 274 hurdle, although Bob’s poor recordkeeping limits him to 70% of the cost for his Section 179 deduction.

“The problem for Short Stop here is that we’ve found it to be a company that has taken unreasonable reporting positions for a long time, and after being warned not to do so by an IRS revenue agent. It had a competent adviser but didn’t rely on him for advice. So, even if other taxpayers might have been reasonable in deducting the cost of the equipment, Short Stop itself was unreasonable in not substantiating these deductions. The failure to track and substantiate in any way their varied uses was not reasonable here. We therefore find that the accuracy-related penalties apply for both years at issue.” T. C. Memo. 2023-114, at pp. 21-22. (Footnote omitted, but it says that even though Bob wins on the forklift, he kept no records allocating business use (he used the forklift to push a snowplow and most of that was personal) but deducted almost all of the forklift cost, hence the chops on the whole deduction, even though he gets 70% of the deduction itself).

I got a midnight hot flash from a well-placed source that IRS is folding all chops in Lakepoint Land II, LLC, Lakepoint Land Group, LLC, Tax Matters Partner, Docket No. 13925-17. Recalling IRS’ commitment to candor, fairness, and transparency, IRS will ditch the backdated docs, and will review the other syndicated easement cases to make sure that, if Boss Hossery is asserted, they’ll play it like Caesar’s wife, above reproach.

A Taishoff “Good Job, First Class, with Swords and Diamonds.”

And Tell Harvard Too

The following notice appeared on the United States Tax Court website homepage today, without elaboration.

“Petitioners and practitioners logged into their DAWSON accounts may experience problems opening documents on a docket record when using a mobile device such as a phone or tablet.”

Pity this warning wasn’t available back in mid-December, when Antawn Jamal Sanders was eleven (count ’em, eleven) seconds late with his filing due to his own nonDAWSON computer jimjams, as more particularly bounded and described in my blogpost “In the Midnight Hour,” 6/20/23.

It looks like Antawn never filed an appeal, but all is not lost.

He’s still within the 90-day window per Rule 190; 4 Cir, to which it seems Antawn is Golsenized, might go with 3 Cir in Culp and apply equitable tolling.

And if ever there was a Section 6213 SNOD case where equitable tolling was a slamdunk, this is it.

How ’bout it, Harvard? Shouldn’t the Fogg of the Legal Clinic of the Harvard Law School spread on to Richmond?

William H. Evenhouse and Nelle L. Evenhouse,, T. C. Memo. 2023-113, filed 9/7/23, got back to CA on the same day IRS sent them a SNOD, which was mailed to their CA address. But IRS didn’t get Bill & Nelle’s petition until 148 (count ’em, 148) days after SNOD mailing. Judge Albert G. (“Scholar Al”) Lauber, confronted with IRS’ USPD Form 3877 showing date of mailing and Bill’s & Nelle’s travel documents showing they returned to The Land of the Free from Turkey on said date of mailing, didn’t allow Bill & Nelle the 150-day out-of-country SOL, but went all Hallmark Collective, saying Section 6213 is jurisdictional as to SNODs, and Section 6213(a) “if the notice is addressed to a person outside the United States,” doesn’t apply. T. C. Memo. 2023-113, at p. 3.

Game over, right?

Maybe not. Bill & Nelle, living in The Bear Republic, are Golsenized to 9 Cir. And 9 Cir says Section 6213 cutoffs are jurisdictional. Judge Scholar Al reviews 9 Cir precedents in T. C. Memo. 2023-113, at p. 3, footnote 2. But there’s more than that.

“Therefore, we need not address a recent ruling by the U.S. Court of Appeals for the Third Circuit that the statutory filing deadline in deficiency cases is a non-jurisdictional “claims-processing” rule. See Culp v. Commissioner, No. 22-1789, 2023 WL 4612024 (3d Cir. July 19, 2023.” Ibid., as my expensive colleagues would say.

Culp? Seriously? See my blogpost “No Time for Modesty,” 2/15/22. But little did I then know that the Fogg of the Legal Services Center of the Harvard Law School would descend upon, and the Boechler, P. C., fog would envelop, 3 Cir.

Wait until the Supremes get their hands on this one.

What a darling silt-stir!

No, not the further tribulations of the brown-headed nuthatch or the denseflower knotweed (for which see my blogpost “A Nuthatch, A Knotweed, A Fox Squirrel, and A Busted Benderdinker,” 10/17/22). Judge Mark V. (“Vittorio Emanuele”) Holmes has found a new candidate for conservation easement protection.

No, not properly dated IRS documents.

Ardan Holdings, LLC, Ardan Investors, LLC, Tax Matters Partner Docket No. 17483-21, filed 9/6/23, “…is one of many syndicated-conservation-easement cases before the Court, and we continued it because the parties needed a considerable amount of discovery. They have been cooperating in informal discovery ever since, but recently petitioner moved to calendar this case for trial, because scheduling these cases has become increasingly difficult; and respondent moved to consolidate docket number 8164-23 with this case, because the newer case alleges the same highest-and-best use, features the same alleged promoter and appraisers, is derived from the same parent parcel, and is in the same county as this case.” Order, at p. 1.

Sounds like a perfect candidate for joint trial, briefing, and opinion, no?

But therein lies the rub.

“The problems with calendaring are a shortage of courtroom space, especially in Atlanta where courtroom availability is an endangered species; the fiscal constraints on respondent’s ability to retain an expert witness this late in the fiscal year; and the number of trials looming for counsel on both sides.” Order, at p. 1.

Atlanta is Ground Zero for high-profile State law trials and the Dixieland Boondockery tsunami.

So maybe try Columbia, SC, or agree for 8164-23 to be bound by the outcome in 17483-21.

Expect a major knock-on effect.

Judge Mark V (“Vittorio Emanuele”) Holmes dismisses the petition of Emmanuel D. Pacquiao, Docket No. 20835-19L, filed 9/5/23, without prejudice. IRS does not object.

I remain, after many years, at a loss how a petition in a lien/levy case (hence the “L” in the docket number) can be dismissed without prejudice. Section 6320(b)(2) allows but one (count it, one) fair hearing (CDP) per taxable period specified in the NFTL; Section 6330(b)(2) has an identical limitation for CDP in NITL cases. Section 6330(d)(1), applicable both to NITLs and NFTLs (the latter pursuant to Section 6330(c)), provides for the thirty-day SOL on petitions from both classes of CDP.

Yes, I know about equitable tolling. Boechler, P. C. resonates loud and clear. But if Emmanuel wants to try another petition later, why not seek a continuance, get his act together, and seek leave to amend later? Why drop the current petition, file a new one, pay another sixty Georges, and take the not-inconsiderable chance that the claim of equitable tolling doesn’t fly because he already timely petitioned, so why does he need equitable relief?

And why does IRS consent, unless they’re playing “gotcha!”, and will grab Emmanuel’s property now that the stay provided by Section 6330(e)(1) is lifted?

Puzzling. Any reader have any ideas? I see Emmanuel is represented by counsel; if they made a deal with IRS, why not enter a stiped decision?

The headline first written at the head hereof should come as no surprise to the greatest part of the readers of this my blog; even the most casual among you know that today is Labor Day, a Federal holiday observed in the Wannabe State, hence circumscribed by Rules 10(d) and 25(a)(5)(A).

Wherefore there is nothing here.

No, not an airshow flyby; this is Bruce S. Harris, Deceased, Docket No. 7474-23S, filed 9/1/23. STJ Diana L (“Sidewalks of New York”) Leyden orders 75 (count ’em, 75) pages which accompanied the petition of the late Bruce (presumably filed before he became the late Bruce) to be sealed, as they contain personally identifiable information. Moreover, STJ Di orders IRS to proffer proofs of Section 6751(b) Boss Hossery, failing which either IRS folds the chops or both parties shall file status reports.

As a docket search shows no motion to substitute parties and amend the caption has been filed, exactly how is the late Bruce to proceed? That “great gulf fixed” elucidated by an even greater Authority than US Tax Court still remains unbridged, and is likely to remain so.

So it might be time to get a fiduciary/ex’r/adm’r in for the late Bruce.

I was able to offer telephonic congratulations today to STJ-designate Jennifer E. (“Publius’) Siegel, on her elevation to CSTJ Lewis (“The Great Name”) Carluzzo’s “few, happy few.”

Her successor to the post which she has held so long and in which she served so well has not yet been named. No date can now be determined when her successor will be named. In the meantime, the contact information for Public Affairs on Tax Court website will remain the same.