Daniel Isaiah Thody, T. C. Memo. 2026-30, filed 3/30/26, need not worry that he might be twice mulcted for the tax he never paid, as shown on the SFRs he got for the five (count ’em, five) years he never filed. Daniel Isaiah’s business, which his father started, sold airplane parts to DOD. Daniel Isaiah was in jail when he petitioned the deficiencies; his father was in jail during the years at issue, T. C. Memo. 2026-30, at p. 2.

Judge Elizabeth A. (“Tex”) Copeland thinks so little of Daniel Isaiah’s arguments on his own behalf as to give him a Section 6673 frivolity yellow card, T. C. Memo. 2026-30, at pp. 10-11. 

Since Daniel Isaiah did pay the criminal restitution amerced by USDSWDTX, he needn’t pay the $162K twice.

“Although the IRS may have previously collected without assessment or even summarily assessed the restitution liability, it neither assessed nor collected such restitution as a deficiency.  This does not necessarily mean that the IRS is not required to later credit its deficiency assessments for the years in issue with amounts (if any) collected on the restitution. Mr. Thody’s payments on the restitution liability, if any, do not affect the existence of deficiencies for the years in issue; but rather such payments will apply after assessment to satisfy that deficiency or a portion thereof.” T. C. Memo. 2026-30, at pp. 7-8. (Citations omitted; emphasis by the Court).

Restitution is estimated loss to the guvmint; deficiency is adjudicated tax due. Latter may be greater or less, so sort it out in the Rule 155 beancount.