Practitioners representing the whistleblowing community may want to take a quick peek at Ch J Patrick J. (“Scholar Pat”) Urda’s order in Santo A. Dileo, Sr., Docket No. 3195-26W, filed 8/31/26.

Santo Sr. is pro se, so IRS wants a Rule 103 to cover any Section 6103(h)(4) disclosures they may have to make to Santo Sr. or his counsel.

Ch J Scholar Pat obliges. And here’s a preview of what IRS will accept.

Practitioners may want to drag-and-drop, and tailor appropriately, so when they need to move for a Rule 103, they can lodge something that gets a “GRANTED” stamp.

Judge Elizabeth A. (“Tex”) Copeland thus grants summary J to IRS, despite the “high touch” designation from the subject matter classifier to the whistleblowing of Jeremy Berenblatt, T. C. Memo. 2026-77, filed 8/31/26.

When Jeremy blew seven (count ’em, seven) years after a couple of IRS CID SAs interviewed him, his Form 211 went to an SMC. “The classifier, considering only Mr. Berenblatt’s submission, determined that his claim potentially rated an H (high touch) designation.” T. C. Memo. 2026-77, at pp. 3-4. (Footnote omitted, but it says high touch means the case warrants assignment to a senior WBO employee and potential coordination with other IRS functions.).

IRS says they knew already about what Jeremy blew, he wasn’t a witness on any trial, what he gave IRS didn’t substantially aid in their billion-dollar recovery; the “but-for” argument isn’t enough, and Jeremy’s claim about how RAs handled form 11369 don’t add anything to what Judge Tex Copeland already found.

And a high touch is not a slam dunk.

“Mr. Berenblatt misunderstands the role of the classifier within the whistleblower regime’s overarching structure. A classifier is an employee of an operating division who functions as a gatekeeper. See IRM 25.2.1.3.1 (Mar. 10, 2023) (‘Classification’s role is only to determine if the information on the Form 211 warrants further review. It is not classification’s responsibility to determine whether a whistleblower is entitled to an award.”). Indeed, if we agreed with Mr. Berenblatt, there would be no need at all for the WBO; classifiers alone would be sufficient. Here, the classifier determined, solely on the basis of Mr. Berenblatt’s Form 211 submission, that Mr. Berenblatt’s claim warranted further review. However, that a claim is not prima facie unviable is not the same as saying that the claim is meritorious.” T. C. Memo. 2026-77, at p. 14.

IRS counsel are notorious devotees of the “Win Your Case at Discovery” gambit. But the trusty attorneys for Chad Burris & Julie Burris, et al., Docket No. 18712-22, filed 8/28/26, have been successfully slow playing IRS’ treasure hunt. For backstory, see my blogpost “Don’t Suppose You Can Depose – Indocumentado,” 4/29/26.

So IRS’ counsel unleash a barrage of motions seeking documents, admissions, and elucidations, which Judge Cary Douglas (“C-Doug”) Pugh grants in extenso. The wrangling “which has plagued this case” caused Judge C-Doug Pugh to continue the special trial session supposed to start on Monday.

Now said trusty attorneys have ten (count ’em, ten) days to pony up or show good cause at the trial next year why whatever they didn’t hand over should be allowed in.

For those of my readers who have led clean and sober lives, far from track and table, to “slow play” at poker is to bet weakly so as to entice an opponent into overvaluing his/her cards, springing a trap at the last. 

Here, IRS calls. And Judge C-Doug Pugh is waiting.

STJ Jennifer E. (“Publius”) Siegel has a 32 (count ’em, 32) page small-claimer. I’ll let Her Honor judge-‘splain.

“The simplest version of this small tax case Opinion is that petitioners are liable for the deficiencies determined by the Internal Revenue Service (IRS) for each of the four years before us because they failed to meet their burden of proof and establish entitlement to any of the deductions claimed. If that were the whole story, however, this Opinion would not be 32 pages long. There is also a fraud penalty at issue for each year, and that requires a few more pages to discuss what petitioners claimed on their tax returns and to make clear how the IRS proved fraud by clear and convincing evidence. But really, this Opinion is long because one of the factors we consider in evaluating fraud is the sophistication of the taxpayer. And Mr. Janangelo is a pretty sophisticated taxpayer; Mr. Janangelo is an auditor at the IRS.” Peter J. Janangelo, Jr. and Mary Ann Janangelo, T. C. Sum. Op. 2026-8, at p 2.

Mr. Janangelo is also a CPA and a member of the Bar of Our Fair State.

“Mr. Janangelo was employed full time at the IRS during the years at issue and, at the time of trial, had been for almost 20 years. In his capacity as a revenue agent for the IRS, Mr. Janangelo conducts audits and reviews tax returns. He belongs to the National Treasury Employees Union (NTEU) and has been a union steward.” T. C. Sum. Op.  2026-8, at p.2. (Footnote omitted, but it says he works for IRS, not OCC.) 

I’ll spare you the rest, barring two points for audit.

“Mr. Janangelo argues that he is not required to substantiate any expense under $75, no matter what the category. He cites no authority for this proposition.” T. C. Sum. Op. 2026-8, at pp. 15-16.

Notwithstanding Section 446, requiring cash basis taxpayers to recognize income and expense when paid, ” Mr. Janangelo argued that the IRS should have been more flexible during his audits, explaining that his own audit practice working for the IRS is to allow a deduction, even if claimed for  the wrong year. Mr. Janangelo’s practice as a revenue agent may be to allow such deductions, but the Court’s role is to apply the law as written to the facts put in evidence. The Janangelos find support in neither.” T. C. Sum. Op. 2026-8, at p. 18

I do not recommend either position.

Jeremy Berenblatt, T. C. Memo. 2026-75, filed 8/27/26, is an unending source of blogfodder. Y’all will recollect Jeremy blew on a digital options dodge seven (count ’em, seven) years after IRS interviewed him. So far no dough for Jeremy, but his trusty attorneys (whom I’ll call the Scotts) are in there pitching, trying to supplement (or maybe complete: the rules overlap) the administrative record, and have Judge Elizabeth A. (“Tex”) Copeland take 14 (count ’em, 14) judicial notices.

Problem is Dania Beach. Jeremy and the Scotts, says Judge Tex Copeland, are firmly aground. City of Dania Beach v. FAA, 628 F.3d 581 (D.C. Cir. 2010)) is the barrier. The three-way test is “1) if the agency ‘deliberately or negligently excluded documents [from consideration] that may have been adverse to its decision,’ (2) if background information was needed ‘to determine whether the agency considered all the relevant factors,’ or (3) if the ‘agency failed to explain administrative action so as to frustrate judicial review.’ City of Dania Beach, 628 F.3d at 590.” T. C. Memo. 2026-75, at pp. 11-12.

Jeremy wants IRS’ notes from his interview. Even if that happened years before his Form 211, maybe they can be included on the “all relevant factors” front. But that’s not a catch-all; it only includes material to explain complex technical issues. IRS was already on the trail of the dodgefloggers. And Jeremy put what he had told the IRS in his Form 211, so the Ogden Sunseteers had the whole story.

Jeremy’s own file wasn’t attached to his Form 211. Anyway, it’s not adverse to the OS decision, doesn’t provide relevant technical background, nor does omission frustrate judicial review.  As for IRS e-mails that he wants, they were created after he petitioned so could never have been considered in evaluating his blow. As for deliberately or negligently excluded, they had to exist when the decision was made.

There’s a lot of argy-bargy about in camera review of grand jury testimony, T. C. Memo. 2026-75, at pp. 16-20, but I leave that to the technicians. F.R. Crim. P. § 6(e)(3)(E)(i) is well outside my wheelhouse.

As for the 14 judicial notices, they also founder on Dania Beach. “As a threshold matter, Mr. Berenblatt does not detail how his requested adjudicative facts fit into the City of Dania Beach framework. Moreover, none of Mr. Berenblatt’s 14 RAFs are facts generally known within the jurisdiction or capable of accurate and ready determination. RAFs 1, 2, 3, 4, 7, 10, 11, 12, 13, and 14 describe the course of the prosecution of the… promoters and relate to Mr. Berenblatt only obliquely, if at all. They therefore cannot properly be considered adjudicative facts in the first instance. Moreover, to the extent that the RAFs incorporate inferences and speculation, they are not facts at all.” T. C. Memo. 2026-75, at p. 22.

No, you don’t have to suffer to prove you have a profit motive. But it helps if you worked hard and got hurt. Just ask Sydney L. Gutierrez-Chapin, star of Frank L. Chapin, Deceased, and Sydney L. Gutierrez-Chapin, et al., T. C. Memo. 2026-76, filed 8/27/26. The late Frank (that’s Frank CPA) and Sydney had a tangled trail over the six (count ’em, six) years at issue, so I’m not going to summarize all the ground Judge Vasquez covers.

But two (count ’em, two) points in his opinion are worth a look.

The late Frank and Sydney both grew up on farms and tended animals. At home in ID, they were quarter horse and Appaloosa breeders, ropers and racers. My colleague Peter Reilly CPA knows this story well. 

But here’s the kicker (and I mean kicker): “As with cattle, in the spring, petitioners monitored the horses ready to foal around the clock, including four to five times at night, and moved the horses with foals to separate areas. Petitioners have overseen the births of over 100 colts.

“Other responsibilities on the ranch included cutting, baling, and stacking hay. In addition to the field work, petitioners repaired the fencing and various buildings on the land. The physical labor needed to maintain the ranch took a considerable toll on petitioners. Additionally, both petitioners sustained injuries at different times from falling off or being kicked by horses.” T. C. Memo. 2026-76, at p, 8. 

And notwithstanding personal bankruptcy, the late Frank and Sydney stayed in the barn and in the saddle. True, the late Frank and Sydney were a trifle casual with their paperwork and stayed the course when others would’ve bailed. IRS folded some deductions if Judge Vasquez found the late Frank and Sydney had a profit motive.

Judge Vasquez says pain equals gain. “Section 183 does not require that taxpayers operate their ventures with perfect business acumen. Petitioners’ persistence in the face of hardship may reflect unusual business judgment, but it does not belie an honest profit motive, which we find petitioners to have established.” T. C. Memo. 2026-76, at p. 23.

Remember, the late Frank was a CPA. So how about bookkeeping?

“Respondent contends that petitioners are liable for the section 6662 penalties because they failed to keep, maintain, and produce organized records relating to their business income, expenses, net operating and capital losses, and Schedule F activity, resulting in their need to reconstruct numerous documents. Mr. Chapin prepared their 2009, 2010, 2011, and 2012 returns using working trial balances, balance sheets, and profit and loss statements. All income was recorded, regardless of the account in which it was deposited, including any cash received, and Mr. Chapin allocated expenses among personal expenses, expenses incurred in the accounting practice, and expenses incurred in their farming activity. He then reconciled each account every month. Petitioners kept their receipts, including those for personal expenses and organized them in ledger categories. To the extent that petitioners failed to effectively present that evidence at trial, we believe that petitioners’ age and the passage of time were significant contributing factors. Accordingly, we find that petitioners are not liable for accuracy-related penalties on the underpayments relating to respondent’s adjustments to income and disallowances of Schedules C and E deductions not subject to section 274(d).” T. C. Memo. 2026-78, at pp. 30-31.

Unhappily, Sydney “fell woefully short of the stringent requirements of Section 274(d)” and loses those deductions. 

Once again I advert to that 2018 success for my daughters’ childhood friend, as The Great Chieftain of the Jersey Boys tries to exit a couple cases (hi, Judge Holmes). But there’s another attorney on the case, and untangling isn’t so easy.

Judge Rose E. (“Cracklin'”) Jenkins judge-‘splains in Open MRI and Imaging Rochelle Park, Inc., Docket No. 5433-22, filed 8/26/26.

“…counsel for petitioner Frank Agostino filed a Motion to Withdraw as Counsel (Doc. 43). In the motion, Mr. Agostino notes that although CH ‘also remains listed on the docket as counsel for Petitioner,’ he ‘on information and belief, is no longer in contact with Petitioner.’ Accordingly, Mr. Agostino states that ‘Petitioner would not continue to be represented by counsel in fact’ after his withdrawal.” Order, at p. 1. (Name omitted).

Of course, both petitioner and respondent object to the motion.

Judge Jenkins sets up a schedule for CH to make his position known. Meantime, serve the petitioner with all papers.

Btw, trial on in less than 90 days.

That’s the latest Dixieland Boondockery deal in Judge Albert G. (“Scholar Al”) Lauber’s division. I don’t undertake to blog, much less evaluate, every dodge settlement; there are far too many and the cottage industry has too many players. But practitioners should have some notion of the going rate, however attenuated, to help them decide whether to hold or fold.

Howbeit, Sand Investment Co., LLC, Inland Capital Management, LLC, Tax Matters Partner, Docket No. 7307-19, filed 8/25/26, got a Sched K, line 13(d) other deduction of $15 million; their charitable contributions (50%) were cut from $80 million to $50K. There were a basis adjustment and other assets revalued. And they got a 10% gross valuation misstatement chop under I.R.C. § 6662(h). No other chops.

Good deal? I report, you decide.

That’s Judge Ronald L. (“Ingenuity”) Buch’s word to practitioners when a new coruscation from the Supremes or the CCA swims into your ken. Thus he admonishes Intermountain Electronics, Inc., Docket No. 11019-19, filed 8/24/26, when they try to insert a Loper Bight challenge to some Reg. or other in their reply brief.

The Intermountain’s trusty attorneys had three (count ’em, three) months after the Supremes issued Loper Bright to mention it in their post-trial brief, but didn’t.

Now in extenuation of Judge Ingenuity Buch’s toss, the trial transcript runs thousands of pages, not to mention exhibits, the latter figuring in my blogpost “Don’t Stick It to the Rock,” 5/30/24, along with the 35 (count ’em, 35) stipulations of agreed facts. Might overlook a wee detail like the Supremes overruling a 40-year-old precedent.

Except.

Judge Ingenuity Buch doesn’t.

“As a general rule, issues raised for the first time in a reply brief are untimely, and we will not consider them. Ashkouri v. Commissioner, T.C. Memo. 2019-95, *23 n.9 (citing Considine v. Commissioner, 74 T.C. 955, 969-70 (1980)). Although it is true that Loper Bright was not decided until after the conclusion of trial in this case, Intermountain had sufficient time to address it in its Seriatim Opening Brief. Loper Bright was handed down only two days after trial end and more than three months before Intermountain filed its opening brief. Intermountain had ample time to raise its arguments with respect to Loper Bright but didn’t. The issue was not timely raised or preserved, and we will not consider it.” Order, at p. 1.

For Ashkouri, see my blogpost “Casual Isn’t Critical,” 7/30/19.

Taishoff covers Tax Court.

It’s the best, and probably the most quoted, aphorism of Dr. Samuel Johnson. “Depend upon it, sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully.”

Judge Courtney D. (“CD”) Jones echoes Dr. Sam’s observation, as she takes ZMZ Global, Inc., Docket No. 15380-22, filed 8/21/26, off the 180-day status report track, where it’s been since Valentine’s Day a year ago.

The latest billet doux from ZMZ announces they and IRS reached a basis for settlement in May, are working on a stiped decision, and hope to file same “shortly.” Order, at p. 1.

Judges love settlements, and Judge CD Jones is no exception.

“The Court appreciates petitioner’s report and is encouraged by the parties’ apparent progress toward resolution of this case.” Order, at p. 1.

Except.

“Petitioner requests that the Court retain jurisdiction and require status reports every 180 days if the decision document is not filed.” Idem.

Do I hear a waltz? More to the point, maybe so might could be Judge CD Jones hears a waltz.

“…the Court concludes that continuation of the 180-day status report track is not warranted under the circumstances; specifically, petitioner represents that a decision document is expected to be filed shortly. Accordingly, the Court will remove this case from the 180-day status report track and direct the parties to file either a proposed stipulated decision or a further report within 60 days.” Order, at p. 1.