Middle Department Inspection Agency, Inc., T.C. Memo. 2025-99, filed 10/1/25, asserts all manner of errors of fact and law, but Judge Courtney D. (“CD”) Jones finds the AO followed the IRM, so affirms the NFTL and NITL. The ambiguous language in the rejection of an OIC which pled special circumstances because the AO denied that “consistently underfunding the pension plan qualifies as a special circumstance because, ultimately, the pensioners were paid net payments without regard to the future payments they were entitled to/promised,” T.C. Memo. 2025-99, at p. 20, is stated in the context of ability to pay the Section 4971 underfunded defined benefit plan excise tax, not how such a plan is terminated.

There are 18 (count ’em, 18) underfunded years, $9 million in unpaid tax, and an OIC of $250K while MDIA admits to north of $2 million in assets.

MDIA’s trusty attorney leaves no ambiguity unaddressed, and every argument vociferated, but at close of play, MDIA is a profit-making business whose payment of tax would not impair the community, the tax laws are there to be enforced, and the AO’s conclusion that OIC is too low is sustained.

When MDIA went bankrupt, the owner kept the pension plan despite having been able to blow it off, and claims (though doesn’t prove) he paid all the covered retirees without missing a payment and bought some of them annuities, so Pension Benefit Guaranty Corp. signed off on the exit. T. C. Memo.  2025-99, at p. 10.

No good deed goes…but you know the rest.