Judge Emin (“Eminent”) Toro remands again Whistleblower 769-16W, 159 T. C. 2, filed 8/4/22, back to the Ogden Sunseteers (how nice they have something to do post-Li). But he won’t retain jurisdiction.

Both 769-16 and IRS want the remand, because “‘[t]he pending IRS actions against the target taxpayers are not interdependent, and the actions may become final at different times and involve different levels of contribution from the Petitioner’s information, if it is considered.’ Therefore, ‘it may be appropriate for the Whistleblower Office upon remand to issue a separate determination relating to each [target] taxpayer.’ In addition, ‘[t]he timeline for the resolution of any IRS actions against the [target] taxpayers cannot be known at present, nor is that timing under the control of the Whistleblower Office.’ And ‘[t]he Whistleblower Office must wait until the outcome of the IRS actions before the Whistleblower Office can evaluate the contribution, if any, of the Petitioner’s information, and cannot make any determination until there is a final determination of tax.'” 159 T. C. 2, at pp. 2-3.

But there never yet was a remand to the OS where the Tax Court judge did not retain jurisdiction. And the IRS and 769-16 can’t agree to give Tax Court powers it doesn’t have. But trust Judge Eminent to find a way.

“Nothing in section 7623(b) precludes us from proceeding as the parties request, and we see no other reason for declining their invitation in the circumstances here.” 159 T. C. 2, at p. 3.

Tax Court acts like an appellate court when it reviews whistleblower cases; appellate courts very rarely retain jurisdiction, unless an administrative agency is unusually obstreperous or contumacious. And the Ogden Sunseteers are docile to a fault.

True, three (count ’em, three) years ago, ex-Ch J Michael B (“Iron Mike”) Thornton retained jurisdiction when he remanded 769-16. See my blogpost “Anyone Can Whistle – And Get Remanded,” 4/11/19. But now, with an open-ended timeline beyond the parties’ control, that serves no purpose.

“Finally, proceedings under section 7623 differ from those under section 6330, which governs hearings concerning proposed levies.  Section 6330(b)(2) contemplates that ‘[a] person shall be entitled to only one hearing under this section with respect to the taxable period to which the unpaid tax . . . relates.’ That statutory text counsels in favor of our retaining jurisdiction with respect to any remand for a supplemental hearing in cases under section 6330. Doing so permits us to review the entire hearing (as supplemented) once the remand is complete and avoids any disputes about compliance with the section 6330(b)(2) restriction as well as any potential prejudice to a taxpayer seeking our review. By contrast, nothing in section 7623(b) contemplates that a whistleblower is limited to one proceeding before the Whistleblower Office. Thus, our declining to retain jurisdiction during a remand here, at the request of the parties and after vacating the Whistleblower Office’s prior determinations, neither departs from the statute nor prejudices a whistleblower in Petitioner’s circumstances.” 159 T. C. 2, at pp. 5-6.

So 769-16 may be furnishing forth much future blogfodder, to make up for all the tossed post-Li gang.

STJ Eunkyong (“N’Yawk”) Choi has IRS playing the Michael Corleone classical gambit to counter the silt-stirring attack on Boss Hossery from Humboldt Shelby Holding Corp., Docket No. 23763-16L, filed 8/4/22.

This long-running saga from immunologist James (“Little Jim”) Haber has been here before. Today’s disputation involves the Section 6662 chops assessed long ago and unchallenged in the deficiency proceedings which preceded the NITL and NFTL here, and the rejected OIC.

IRS wins summary J on the OIC bounce. COIC needn’t negotiate with offrerors, and letting these shelterjammers off with a grand would encourage others.

But the Boss Hossery challenge isn’t to the underlying liability. It’s a stand-alone requirement, a hapax legomenon. See my blogpost “Stir, Baby, Stir – That Silt,” 12-20/17. And verification of proper compliance is required by Section 6330(c)(1). See Order, at pp. 5-6.

Once again the Genius Baristas have posted the order in PDF, so I cannot copy-and-paste from it here.

IRS never showed proper Section 6751(b) compliance at any stage, so no summary J on the chops. Probably they’ll never be collected; looks like the tax itself is also a lost cause.

Neither opinion nor order worthy of comment today. I won’t waste your time.

Your attention is respectfully directed to my blogpost “A Rant,” 3/7/13. I see some 574 orders on the Tax Court website thus far today, of which 250 are standing small-claimers. I imagine not a few of the recipients thereof will do as Noël Coward suggested is done in Bangkok at twelve o’clock. The rest will hover in some sort of limbo.

Remember we had some 35,000 petitions filed in CY 2021. Also, in that same period, my source tells me we had 24 full-dress T. C.s,  145 T. C. Memos., and 42 T. C. Sum Ops. My ultra-sophisticated readers need not tell me that cases were disposed of via off-the-benchers, stip-outs, and dispositive orders (summary J, no jurisdiction, no pay, claim preclusion). I have no tally of those, and I daresay no one else does, either. But let me know if I’m wrong.

Meantime, petitioners are still waiting for their “dission.”

Another of Judge David Gustafson’s conundrums is found in Rock Creek Property Holdings, LLC, Rock Creek Land Manager, LLC, Tax Matters Partner, Docket No. 5599-17, filed 8/1/22. Tax Court is one of those rare venues where a non-human can proceed without counsel; Rule 24(b) lets corporations, trusts, estates, and unincorporated associations pick a fiduciary, officer, or authorized individual to appear and litigate in Tax Court, whether admitted to practice or not.

But LLCs (limited liability companies), creatures of State statutes, never got mentioned in Rule 24(b), and ex-Ch J Maurice B (“Mighty Mo”) Foley didn’t fill the gap when he proposed Rules changes back in March.

The Rockers’ trusty attorney wants to bail, but who will “take up our quarrel with the foe”?

Judge Gustafson to the rescue. “Rule 24(b)(1) does not explicitly mention a ‘limited liability company’, but we construe the rule’s allowance to extend to an LLC. That is, we will allow Manager to continue to prosecute this case without counsel.” Order, at p. 2.

But Manager, the Rockers’ TMP under the now-repealed TEFRA régime, is inhuman; it’s another LLC.

Since trusty attorney filed the petition, no individual was designated to act for Manager, thus Rule 24(b)(2)(B) is off the menu.

Judge Gustafson again does the Gordian knot number.

“The case proceeded with counsel, but now counsel proposes to withdraw. Rule 24(c)(4) requires that ‘[a]ny motion to withdraw as counsel or to withdraw counsel must also include the party’s then-current mailing address, email address (if any), and telephone number.’ Paragraph 8 of Mr. [trusty attorney’s] motion acknowledges Rule 24(c)(4)(B); and as ‘[t]he TMP’s current mailing address’ the motion gives ‘Rock Creek, LLC, c/o Dwayne P. (Pete) Davis . . . .’ The motion does not state Mr. Davis’s relation to Manager, nor (assuming he is the human person who will appear) the capacity in which he will be appearing (whether officer, member, or something else).” Order, at p. 2.

So let trusty attorney dish on the individual who will appear for Manager: name, mailing address, e-mail (if any; but who in the 21st Century doesn’t have e-mail? Maybe another Rule change should require litigants to get e-mail), telephone number, and capacity In which appearing (member, manager, assignee, Bankruptcy trustee, receiver, creditor, casual bystander).

A good practice tip from Judge Gustafson.

This my blog has finally made it to the Pillars of Hercules. Today, 7/31/22, for the first time, my blog has been read in Gibraltar.

Takes me back to my young day when I collected QSL cards.

Now for Monaco, Andorra, and San Marino.

And they are an essential element of every judicial opinion, even a five-page off-the-bencher. I’m truly surprised at CSTJ Lew (“Especially With That Name”) Carluzzo making an offhanded observation that “(T)he relevant facts and controlling law are well known to the parties and need not be discussed in this bench opinion.” Transcript, at p. 4.

Judge, I’ve not the slightest doubt that petitioner and respondent gave the facts and controlling law the Job 19:24 treatment.

But what about the rest of us? I know that off-the-benchers are not precedent; at best are law of the case. But we practitioners read them, learn, mark and inwardly digest them. Especially in a Section 7502 mailed-is-filed case, where extrinsic evidence is received and carries the day for petitioners.

Great that the employee of petitioners’ trusty (former?) attorney was a good witness, and that the firm’s records were top-fuel. But what about postmark? Was there one? If so, was it legible? What is the source of data for ETA at the Glasshouse for a petition posted from wherever? Where is this case Golsenized, and does that CCA allow extrinsic evidence in a Section 7502? And does ABA Model Rule 3.7 play any part here?

I’m thinking maybe, when Section 7502 is in play, it might could be a good idea to try for an off–the-bench resolution, so that these vexatious questions can be avoided if someone can tell a good story.

I blog off-the-benchers, though the trade press and blogosphere don’t. And my readers read them, maybe because the trade press and the blogosphere don’t bother reporting them.

I say Judge Buch got it right: opinions are a critical component of what we understand to be the law. See my blogpost “Cracking Up,” 2/27/14.

Oh, the case is Gina M. Ledesma & Jullian Ledesma, Docket No. 13685-20, filed 7/29/22.

Judge Gale, or the parties, seem to have lost an heir somewhere along the tangled trail of Lawrence W. Nelson, III, Deceased and Jacalyn A. Thompson, Docket No. 18374-15, filed 7/29/22.

IRS wants to toss the late Lawrence (a/k/a Lonnie), who died post-petition, for want of prosecution.

“Respondent represents that he has been advised that no representative or fiduciary is currently authorized to act on behalf of the estate of Mr. Nelson and that Mr. Nelson’s only ascertainable heirs at law are his surviving spouse, petitioner Jacalyn A. Thompson  (Ms. Thompson), and his surviving issue, Brittany Thompson. Respondent further represents that neither Ms. Thompson nor Mr. Nelson’s surviving issue objects to our granting the Motion.” Order, at p. 1.

Jacalyn has established innocent spousery for all but about $51K of the deficiency and add-ons, and has stiped to settled issues with IRS. Order, at pp. 8-9.

So let’s do a Thackeray, and “shut up the box and the puppets, for our play is played out,” right?

Except.

Remember my blogpost “A Voyage of Discovery – Part Deux,” 10/1/21. All y’all will recall one ANR, possibly another surviving issue of the late Lawrence a/k/a Lonnie. A docket search reveals no order resolving whether ANR is in or out. If her fate is buried in a status report, perhaps it should be recited in the Order and Decision for the sake of completeness.

Yes, Tax Court is truly a voyage of discovery.

That’s Jamie B. Hall, T. C. Memo. 2022-82, filed 7/28/22. Jamie’s argument why she doesn’t owe income tax on two trusts (which aren’t trusts at all; no trust instruments, no transfers of title to property) is that Social Security Administration issued a Social Security card to her.

“Petitioner argues that the Social Security Administration created the Jamie Bennett Hall trust by assigning to her a Social Security number and a Social Security card. She argues that the property originally held in the purported trust is the Social Security card and that the Social Security Administration purportedly indicated an intention to form the trust by sending her this card. Petitioner states that the beneficiary of the purported Jamie Bennett Hall trust is the U.S. Government, and therefore the trust is a U.S. Government agency trust and is not taxable. Petitioner further argued that, because respondent determined that she is liable for deficiencies and additions to tax as an individual, respondent used ‘inappropriate forms to come up with Notices of Deficiency.’” T. C. Memo. 2022-82, at p. 4.

Judge Alina I. (“AIM”) Marshall ripostes to this gibberish with a walking barrage of “somber reasoning and copious citation of precedent.”

This is old-time, worn-out protester jive. Jamie goes down for the whole boat, deficiency, add-ons, and chops.

“The issuance of petitioner’s Social Security card is not a transfer of property that creates a trust, as petitioner contends. Petitioner has not provided any legitimate trust documents forming the purported trust. The purported trust does not reflect economic reality and is not recognized for income tax purposes. Accordingly, we sustain respondent’s deficiency determinations….” T. C. Memo. 2022-81, at p. 5.

Judge AIM doesn’t mention Section 6673. Maybe she should have.

I was reminded of a much-quoted essay written by President Lincoln shortly after he returned to the private practice of law following his single term in the House of Representatives.

To see what brought this 150-year-old document back to memory, read Judge Christian N. (“Speedy”) Weiler’s opinion in Charles G. Kinney, T. C. Memo. 2022-81, filed 7/28/22.

Now read what President Lincoln had to say.

“Never stir up litigation. A worse man can scarcely be found than one who does this. Who can be more nearly a fiend than he who habitually overhauls the register of deeds in search of defects in titles, whereon to stir up strife, and put money in his pocket? A moral tone ought to be infused into the profession which should drive such men out of it.”