I note Judge James S. (“Big Jim”) Halpern’s grant of summary J to IRS in Arelia Margarita Taveras, Docket No. 9233-25, filed 4/14/26, for want of anything better coming out of The Glasshouse in the City At War. I’m truly sorry for the petitioner, who threw away a worthwhile career for a compulsion. She does put up a fight, but only two (count ’em, two) of her seven (count ’em, seven) objections to IRS’ summary J motion survive the Ruesch/Garcia jurisdictional limit for passport grabs. And she loses those two.

Strange that the docket number doesn’t add the “P” for Section 7345s.

Arelia is thorough, but the barrier remains. Is there an assessment of a seriously delinquent tax debt? Yes. Validity thereof is to be tested in deficiency or CDP litigation, not passport grabs. She had her chances.

It’s a shame Arelia can no longer exercise her considerable abilities in her chosen profession.

Among his many talents and accomplishments, Judge David Gustafson would have been a great kindergarten teacher, as he exhibits in Carl Lawrence Collins III, Docket No. 2643-17, filed 4/13/26. As the Genius Baristas have published this order in a PDF that does not permit cut-and-paste, I cannot here include Judge David Gustafson’s exact words.

In substance, however, the trial minutes do show petitioner’s evidentiary documents with their “Doc.” numbers, thus making easy the task of the parties in citing to same and Judge Gustafson’s task of referring to them in his opinion.

IRS’ documents are not so listed in the minutes; for whatever reason I’ll not speculate. 

So Judge Gustafson has prepared a two (count ’em, two) page concordance, listing exhibit number, document(s), PDF pages (hopefully in a usable format), PDF pages, and internal numbers for each. This he attaches to his order.

I wouldn’t be surprised if, asked politely, he writes the party’s brief for them.

Abdelhafid Rahmani, Docket No. 4624-24, filed 4/10/26 entered this country in 1995; since 1996, he has been incarcerated, Order, at p. 1. He claims that since he got the $1400 stimulus credit for tax year 2021, IRS conceded that he entitled to same for tax year 2020, so the deficiency for that year is invalid.

Wrong, says Judge Ronald L. (“Ingenuity”) Buch. IRS’ failure to challenge a position isn’t a concession.

Likewise, Ab’s challenge to IRS and SSA computer transcripts showing he had no valid TIN for work in The Land of the Free cannot surmount the FRE 803(6)(A) and 902(11) “submitted by someone with knowledge” barrier.  Order, at p. 4.

Ab’s year-at-issue return failed to include the valid identification number mandated by Sections 6428(g)(3)(A) and 6428A(g)(4)(A), which define “valid identification number” as a “social security number (as such term is defined in section 24(h)(7)).” Ab has a number, but it’s not valid for US work. Ab does claim he worked for McDonald’s in 1995, but “(T)his bare allegation alone is not sufficient to show there is a genuine dispute as to a material fact. Rule 121(d).” Order, at p. 4.

Summary J for IRS sustaining deficiency.

I must say that in whatever slammer Ab has passed the last thirty (count ’em, thirty) years, there is access to a good law library, or perhaps adept jailhouse lawyers. And whatever Ab’s delictions that landed him there, he has diligently applied himself and chosen good advisors.

I’ve lost count of how many times over the last 13 (count ’em, 13) years I’ve praised that Obliging Jurist Judge David Gustafson. From trying cases in the slammer to writing and rewriting papers, and even (I’ve hypothesized) feeding the parking meter at the courthouse and bringing coffee and Krispy Cremes to the trial, I’ve chronicled no more obliging judge than he.

And today Judge David Gustafson again obliges. Carl Lawrence Collins, III, Docket No. 2643-17, filed 4/9/26, must be nearing the end of his nine (count ’em, nine) year trek through Tax Court, as he and IRS try to sort out their several concessions made at trial to avoid wasting time on briefing conceded issues.

Unhappily, as with a certain ceasefire agreement, what the parties agreed isn’t exactly clear. “Our order of March 20, 2026 (Doc. 164) directed the parties to report on such concessions by March 30, 2026. A status report filed that day (Doc. 166) advised that ‘the parties do not anticipate further stipulations or concessions.’ We expected otherwise. The parties’ briefs begin to be due on May 15, 2026. (See Doc. 167.) To facilitate the focused preparation of those briefs, we will order the parties to make the record clear.” Order, at p. 1.

Whereupon Judge David Gustafson expends three-and-one-half (count ’em, three-and-one-half) pages of words and figures setting forth exactly what he extracts the parties to have orally conceded from the trial record. His order directs them to show cause why these, which he schedules, should not be put into the record. Order, at pp. 5-6.

How’s that for obliging?

Judge Emin (“Eminent”) Toro, having disposed of deemed distributions, now ascends to the heights hereinabove set forth at the head hereof, as my Grey-Goose-guzzling former colleagues might say, as he does the numbers for Varian Medical Systems, Inc. And Subsidiaries, 166 T. C. 8, filed 4/8/26.

For the mise-en-scène, see my blogpost “We Don’t Need No Stinkin’ Distributions,” 8/26/24. This was an unscramble of the gyrations which TCJA imposed to try to territorialize our worldwide tax system for CFCs by imposing modest tax on stashes of post-1986 offshore E&P, both cash and noncash varieties.

But now the numbers, brushing aside both parties’ arguments that their calculations raise issues conceded because never before raised. 

“In particular, the parties agree that the Deemed Paid Foreign Tax Credits should be the amount of Varian’s deemed paid foreign taxes after reduction by section 965(g)(1)—i.e., after the reduction that corresponds to the section 965(c) deduction. Similarly, the parties agree that the section 78 gross-up should be the amount of Varian’s gross-up under section 78 after reduction by section 965(g)(4)—again after the reduction that corresponds to the section 965(c) deduction.

“The parties disagree, however, on the meaning of the ‘net section 965 inclusion.’ Varian argues that it should equate to the section 965(a) inclusion amount (the earnings determined under section 965(a) less the E&P deficits determined under section 965(b)).

“The Commissioner contends that, consistent with the other amounts in the formula, the net section 965 inclusion should take into account the section 965(c) deduction. In other words, the Commissioner argues that the net section 965 inclusion should equal the section 965(a) inclusion amount reduced by the section 965(c) deduction.

“The Commissioner is correct.

“Returning to the text of the statute, the point of the formula is to identify ‘taxes paid or accrued (or treated as paid or accrued) with respect to any dividend for which a deduction is allowed under [section 245A].” I.R.C. § 245A(d)(1). In other words, the point of the formula is to allocate foreign taxes to the underlying earnings that were subject to foreign tax and identify the portion of those taxes that were attributable to a deductible dividend (here, the section 78 dividend).” 166 T. C. 8, at p. 28. (Footnotes omitted).

As Mark Twain remarked, “Well you’ve got to admire men that deal in ideas of that size and can tote them around without crutches.”

Continuing this series, and again acknowledging that master communicator Art Linkletter, I proffer Matthew Bruns, Docket No. 15540-24, filed 4/7/26. 

Matthew and IRS stip this case out, with a huge deficiency offset by withholding and payment, but that’s not the point.

Before the stiped decision of even date herewith is entered by Judge Kashi (“My or the High”) Way, there is an Order, wherein is stated: “… the Proposed Stipulated Decision contains an evident typographical error.” Order, at p. 1.

Often happens, when parties are beaten down by prolonged negotiations and just want the pain to end. Just strike the proposed stip and have the parties try again.

Instead, Judge Way orders thus: “…the above-referenced proposed stipulated decision is hereby deemed stricken from the Court’s record in this case and shall be sealed from the public and the parties in this case.” Order, at p. 1.

From the parties? Didn’t they see this before they sent it to the Judge?

Judge Adam B.(“Sport”) Landy gives the Ogden Sunseteers another win (I wonder if the WBO is getting tired of winning) in William Pratt, T. C. Memo. 2026-31, filed 4/6/26. The OS sent William’s claim to SB/SE classifier, who brushed it off as too small ($10K in dispute) to pursue. In a five-page rehash of Li, Lissack, Meidinger/Kennedy, all of which I’ve blogged, Judge Sport Landy finds no jurisdiction. I suppose this merits a T. C. Memo. to show whistleblowers are taken seriously, despite their minimal success rate. But why IRS had to put three (count ’em, three) lawyers on this case, when a first-year law student could have won this, eludes me.

A couple years ago (hi, Judge Holmes), a pro se inspired me to revisit The Rock of Svithjod; see my blogpost “Svithjod Revisited,” 5/10/24. I lamented yet again the waste of scarce Tax Court judicial resources in busywork orders, which any judge’s clerk could handle, freeing the judges to cut down the dockets. The protagonist of that blogpost has departed this vale of tears, so we get Richard W. Medley, Docket No. 13611-22, filed 4/6/26. Judge James S. (“Big Jim”) Halpern, hearing from IRS’ counsel that neither spouse nor child of the late Richard could be found to take up his quarrel with the foe, invites them in.

Freya Pearson, Docket No. 4536-21, filed 4/6/26, ties my personal record for stalling a case that I had to lose on the law, but I was in State court and so actually had to oppose summary J and take an appeal to do it. Freya just stalled for five (count ’em, five) years, with continuance after continuance.  Exasperated, Judge Rose E. (“Cracklin”’) Jenkins fires an eight-page barrage of somber reasoning and copious citation of precedent, tossing the petition and excoriating Freya for repeated disregard of this Court’s orders, so that another continuance would simply reward her for her conduct, such that any sanction short of dismissal would be insufficient, and would simply reward her for her conduct.

I said it long ago: “I wouldn’t be so presumptuous as to claim succession to the role of the late and much-lamented A. G. Linkletter, a hero of my childhood so long ago. But reviewing the activities of the self-representeds as they navigate the straits of The Glasshouse in the City of the Ongoing Purges is a strong temptation.”

Mark Barry Zemanek, Dockets No. 8984-25, filed 4/3/26, has Ch J Patrick J. (“Scholar Pat”) Urda trying to decipher a next-friendship bid from one not conspicuously disabled or incompetent, who is seeking unorthodox representation.

“…a motion to be recognized as next friend, as contemplated by Rule 60(d), is appropriate where a taxpayer cannot prosecute his or her Tax Court case without assistance due to incompetency or incapacitation and does not have a duly appointed fiduciary under state law.

“Petitioner does not appear to allege in his Motion to Be Recognized as Next Friend that he is incompetent or incapacitated, nor has he attached a current statement from his personal physician (or other medical documentation) supporting such a conclusion. Rather, to the extent the Court understands petitioner’s Motion to Be Recognized as Next Friend, he is asking the Court to allow him to represented by an attorney who is currently in inactive admissions status. This is not the nature of representation contemplated by Rule 60(d).” Order, at p. 1.

To the extent Taishoff understands it, “inactive admission” means an attorney admitted in a jurisdiction which would allow said attorney to seek admission to Tax Court via Rule 200 but who has not currently applied or, if having applied, cannot satisfy Rule 24(a)(3). But I do crave enlightenment, as in fifteen (count ’em, fifteen) years of covering Tax Court, this is the first time I have met with that phrase.

Meantime, Judge Scholar Pat sends Mr. Zemanek either to try again, showing he is in fact incapacitated or disabled, or to contact the LITC nearest him.

Who are these afecionados is the issue before Judge Jeffrey S. (“Schwer”) Arbeit, but it’s not so hard that summary J can’t resolve it in Blair A. Battersby, et al., Docket No. 1356-23, filed 4/2/26. It’s a chicken farm LLC box-checked to Sub S taxation that turns into Dixieland Boondockery. In year at issue original owners Phil and Teresa swap some stock, so the 10 (count ’em, 10) syndicatees who get 97.5% of the stock claim Section 1377(a)(2) termination affected shareholder status lets them split tax years and make special allocations of the $6.1 million claimed conservation easement deduction.

“Section 1377(a)(1) provides that each shareholder’s pro rata share of any S corporation item described in section 1366(a) for any taxable year is the sum of the amounts determined with respect to the shareholder by assigning an equal portion of the item to each day of the S corporation’s taxable year, and then by dividing that portion pro rata among the shares outstanding on that day (that is, a per-share, per-day basis). See also Treas. Reg. § 1.1377-1(a)(1). Section 1377(a)(2) provides an exception to this per-share, per-day rule if a shareholder’s interest in the S corporation terminates during the taxable year: the S corporation, with the consent of all ‘affected shareholders,’ is permitted to elect to compute pro rata shares of ‘affected shareholders’ as if the taxable year consisted of two separate taxable years. See § 1377(a)(2)(A); Treas. Reg. § 1.1377-1(b)(1). The election under section 1377(a)(2) has no effect on shareholders that are not ‘affected shareholders.’ See §1377(a)(2); Treas. Reg. § 1.1377-1(b). The “affected shareholders” are those shareholders whose interests terminate and all shareholders to whom those shareholders transferred shares during the taxable year. See § 1377(a)(2)(B); Treas. Reg. § 1.1377-1(b)(2). If, however, the S corporation redeems a shareholder’s interest, all the shareholders during the entire taxable year are treated as affected shareholders. See id. 

“The parties share the same understanding of the law. Accordingly both parties acknowledge that unless a shareholder’s interest is terminated because of a redemption by an S corporation, the affected shareholders are limited to the transferors and transferees of the ownership interest.” Order, at pp. 4-5.

Judge Schwer Arbeit finds the paperwork shows the swap was between Phil and Teresa, not a corporate redemption of their stock. Hence only they are “affected shareholders.” Wherefore the syndicatees have only a single tax year and are relegated to per-share-per day straight allocation, no mix-and-match with the claimed deduction.

Of course, there remains the question of the valuation of the easement remains for trial. Order, at p. 1.

Mr. W (name omitted) is, and was during and before the year at issue, Executive Director of the Bessemer Airport Authority, which runs Echo Kilo Yankee, a public-use, business friendly airport with a sincere dedication to serving the entire General Aviation community.  The trusty attorneys for Morgan Run Partners, LLC, Overflow Marketing, LLC, Tax Matters Partner, Docket No. 8669-20, filed 4/1/26, want to put in evidence some of Mr. W’s drafts and e-mails about capital improvements to that striving, thriving installation and testify that maybe so might could be acquiring part of the nearby Dixieland Boondockery at issue here.

Judge Albert G. (“Scholar Al”) Lauber cancels the trusty attorneys’ takeoff clearance and sends them back to the ramp.

“…the trial session beginning April 6, 2026, is limited to deciding a single issue—the FMV of the easement––which will require the Court to determine the FMV of the Morgan Run Property before placement of the easement. In determining the ‘before value,’ we must decide ‘the price at which the [Morgan Run] property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.” Treas. Reg. § 1.170A-1(c)(2). Whether a nearby property owner, such as the airport, considered ‘pursuing’ the Property, at an undisclosed purchase price, without ever communicating any purchase offer to anyone, is not information to which other market participants would be privy. Because this information, even if true, would not be available to a hypothetical buyer with reasonable knowledge of the relevant facts, it is simply not relevant in determining the FMV of the Morgan Run Property.” Order, at p. 3.

Besides, the whole thing is speculative. The drafts are just that, drafts; no showing they ever went beyond that, or if they did, how they ended up. Moreover, throughout discovery IRS asked for “(1) any correspondence with persons interested in acquiring the Morgan Run Property; (2) any offers to purchase the Property; and (3) documentation of any activities with respect to possible industrial development of the Property, including any plans, studies, conceptual designs, permits, permit applications, cost estimates, and/or correspondence with Jefferson County, the State of Alabama, or their respective agencies.” Order, at p. 2. IRS got nothing. The prior owners had Morgan Run zoned residential estate, and the appraisal attached to the Form 8283 stated HBU was residential.

An offer, unaccepted, does not indicate value. Here, there isn’t even an offer.

Discovery closed two (count ’em, two) months ago. This stuff came up in the middle of last month. Judge Scholar Al says this is an ambush and tosses the documents. Mr. W can testify as to facts, and if IRS’ expert spoke to him as petitioners claim, he can testify about that.