Once again, the famous words of Judge Cardozo echo in Tax Court. IRS threw to the wrong base, sending the SNOD for Moxon Corporation, 165 T. C. 2, filed 7/2/25, to an address other than last known address. Hence Moxon owes no tax, as it had no chance to contest liability and SOL had run.

But Moxon was a partner in AD Global, a TEFRA-era dodge, wherein the TMP stiped out the Section 6662(h) 40% gross valuation misstatement chops. Moxon is fighting a NFTL and a NITL for the chops, as IRS conceded collecting the tax.

But after somber reasoning and copious citation of precedent, Judge Goeke finds that while deficiency procedures and proceedings apply to affected items, now-repealed Section 6230(a)(2)(A)(i) takes chops out of the mix.

“…petitioner was obligated to report the tax at issue on its [years at issue] tax returns and was obligated to pay that tax at the time required by Congress. That petitioner generated tens of millions of dollars in purported losses through AD Global, failed to comply with its reporting and payment obligations, and then was fortunate in that respondent mailed the SNODs to an incorrect address does not mean that petitioner ‘was never obligated to pay [the taxes] in the first place.’ Petitioner’s argument on this point is based on a fiction and is unconvincing.” 165 T. C. 2, at pp. 14-15.

As with SOL, the government’s remedy may be gone, but the right remains.

Moxon owes the chops; while IRS’ blunder lets Moxon walk on paying the tax, it’s still owed, and the chops stick.