I hear maybe FDA isn’t so sure you should be, but Mira Vista Homeowners Association, Inc., Docket No.  14901-22X, filed 1/28/25, definitely wants supplements to the administrative record whereto should be added, they say, “some 239 pages, including favorable IRS exemption letters, website information and 990EZ annual filings for other HOAs located in Texas. On brief, respondent disputes the relevance of this submission by petitioner, and contends the documents ‘do not provide any of the facts and circumstances upon which the IRS based their determinations.’” Order, at p. 3.

The Mira Vistas and IRS, with the supplements up in the air, jointly moved to submit under Rule 121. See my blogpost “Common Good, All In ?” 9/25/24.*

Now IRS wants a vacation of that order, and remand to Appeals. The Mira Vistas want a trial.

Judge Christian N. (“Speedy”) Weiler shucks his former order and finds Rule 217 will stretch to cover.

“Rule 217 provides that the ‘[d]isposition of an action for declaratory judgment…that involves… the initial qualification or classification of an exempt organization…will ordinarily be made on the basis of the administrative record, as defined in Rule 210(b)(12). (emphasis added). This Rule equally provides ‘[o]nly with the permission of the Court, on good cause shown, will any party be permitted to introduce before the Court any evidence other than that presented before the Internal Revenue Service and contained in the administrative record as so defined.’ In interpreting Rule 217, courts have permitted supplementation of the record when good cause is shown.” Order, at p. 4 (Footnote and citation omitted).

So without deciding the merits (and not even if IRS was arbitrary in denying the Mira Vistas 501(c)(4) status, the Mira Vistas still have to prove they qualify), Judge Speedy Weiler tells the parties to decide what supplements they’re taking.

Practice tip: Never ever agree to a Rule 121 unless you’re sure your admin record is complete and bulletproof. Save the money your client will have to spend on supplements.

* https://wp.me/p1eNMc-6B9