This Latin tag from the Greek original is surely well-known to Judge Patrick J. (“Scholar Pat”) Urda. It may even be well-known to the trusty attorneys for Michael J. Boettcher and Katherine H. Boettcher, 2021 T. C. Memo. 4, filed 1/12/21. Can’t link to the text; DAWSON doesn’t allow it. Get with it, Genius Baristas.

The Boettchers had their IA bounced, and the bounce affirmed by Appeals, but the SO on the case was less than punctilious with the paperwork.

“Multiple unanswered questions cast doubt on the settlement officer’s analysis, however. First, we note that in calculating the Boettchers’ income and expenses, the settlement officer rejected the Form 433-A out of hand because of perceived omissions with respect to “bank info and investments” on the second page and business income and distributions on the fourth page. But the Form 433-A in the record before us plainly contains bank and investment information. The settlement officer herself noted that the Boettchers had no income besides wages in [year at issue], suggesting that there would be no business income or distributions to be reported. We are left perplexed as to the reasons for rejecting the Form 433-A.

“The settlement officer’s analysis of the Boettchers’ income likewise raises questions.” 2021 T. C. Memo. 4, at p. 12. And Judge Scholar Pat has more to say about that than I have space for.

Judge Scholar Pat weighs heavily against the SO for not asking the Boettchers for more information to clarify, although we’ve seen cases where SOs get a bye. Maybe here it’s quantity; too many unanswered questions, plus the usual nod to Chenery.

“In his briefs respondent defends the rejection of the installment agreement on the ground that the Boettchers failed to supply the financial information requested by the settlement officer in her scheduling letter. This purported failure, however, was not cited in the notice of determination as a reason for rejection. To the contrary, the notice suggests that the Boettchers’ financial information sufficed, stating that ‘[w]e asked you to provide the requested information to us …. We received your correspondence’ and later, ‘we considered your financial information, unfortunately, we were unable to accept your proposal based on our review of your income and expenses you have the ability to make larger monthly payments.’ We cannot uphold a notice of determination on grounds other than those actually relied upon by the settlement officer.” 2021 T. C. Memo. 4, at p. 15. (Citations omitted, but Chenery leads the peloton).

Now the case comes up on a Rule 121 agreed statement. But Judge Scholar Pat, apparently deciding sua sponte that the record is so flawed he can’t decide for IRS or for the Boettchers, remands the case back to Appeals.

I’ve said before that, if offered a remand, or perhaps seeking remand, the practitioner should think twice. See my blogpost “Take the Hint,” 11/25/15. Remand may be a goal-line save for IRS, who can rehabilitate a dicey record the better wherewith to scuttle your client, especially if the Judge gives them a blueprint for the rehab.

But when the Judge decides to do it, unsought by the parties, practitioner beware. See my headline hereinabove set forth at the head hereof (as my already-on-their-second-18-year-old-Macallan colleagues would say).

Before getting dewy-eyed over the new, improved (?), jim-dandy US Tax Court website, note that I said yesterday only that it “cleans up halfway fair.” See my blogpost “Orders in the Court – Part Deux,” 1/11/21.

The Genius Baristas still have a way to go. My links to the texts of yesterday’s orders and opinions don’t work. The case search feature doesn’t update daily, so you won’t find texts that way. There is no cumulative list of orders or opinions, so every day’s budget does a Cinderella number at midnight, never to be seen again (until maybe the case search feature updates, if ever).

In short, there’s plenty work to do.

And maybe so it just might could be that these cybersages and technowiseacres should talk to a few of us who actually use the website every working day and night. Better late than never.

No, this is nothing to do with elections or politics. Patrick C. Kelley, 2021 T. C. Memo. 2, filed 1/11/21, is complaining that his equal protection rights were violated when Congress enacted Section 86(c)(1)(C) and Section 86(c)(2)(C).

Pat is married to Mrs. Pat for the entire year at issue. They did file a LA Separate Property Matrimonial Regime, apparently a Code Napoleonic pre-nup, which gave rise to their MFS returns. Pat wanted the $25K base for his Social Security benefits, but only got zero.

Judge Elizabeth A (“Tex”) Copeland has this.

Originally Social Security was non-taxable, but to harmonize it with other retirement income like pensions, and to preserve non-taxability for the truly poor, but to prevent geriatric high-rollers from getting a windfall, Congress enacted the tax-free ceilings.

But gameplayers could file MFS, doubling up on the tax-free ceiling.

Now generally (love that word!) pore l’il ole Tax Court has zero jurisdiction when That Document is invoked. But Congress has left a minuscule lacuna wherein Tax Court may step a cautious toe, and that is where, inter alia (as my expensive colleagues say) the taxable portion of Social Security benefits is involved.

Unhappily for Pat and the rest of us Socially Securitized, Tax Court has ruled before now that Congress has a rational basis for the class distinction that torpedoes us. You’ll find the cases at 2021 T. C. Memo. 2, at p. 8.

And Congress decided to jump to the defense of marriage, Constitutionally. “… Congress reasoned that married couples should be treated as a unit to prevent windfalls to couples that might otherwise file separate returns. This reasoning demonstrates that Congress had a valid and rational basis for establishing a separate classification for a taxpayer who lived with a spouse for any part of the taxable year and filed a separate return.” 2021 T. C. Memo. 2, at p. 9.

And Tax Court must follow the law, however harsh it may be for Pat.

Edward J. Tangel and Beatrice C. Tangel, et al., 2021 T. C. Memo. 1, filed 1/11/21, are back again. They seem to have straightened out whatever protective order they were seeking in my blogpost “Settle (Protective) Order on Notice,” 9/30/20, but it doesn’t help, as the $900K of Section 41 research credits they got from their Sub S bites the dust.

The Tangels were hired hands. So the Tangels and their Sub S lose the John 10:12 gambit.

Judge Albert G (“Scholar Al”) Lauber notes that when the Tangels’ Sub S agreed to design and build turbine covers, they gave up all substantial interests in the products of their research. In their contract (apparently the standard form of the turbinator who engaged the Tangels’ Sub S), the turbinator (“Buyer”) tied up whatever technical information (“Information”) they gave to Tangels’ Sub S (“Seller”) to develop the turbine covers (“Articles”).

Tangels’ Sub S “…agrees that it will not use, or assist others in using, such Information, design funding or tooling to develop or sell such Articles (or similar interchangeable or substitute Articles, or parts thereof) to anyone other than Buyer, either as production, spare or repaired Articles, without Buyer’s prior written consent. Seller shall not use or disclose such Information except in the performance of Orders for Buyer, and, upon Buyer’s request, such Information and all copies thereof shall be returned to Buyer. If Seller develops, sells the Articles hereunder, or assists others in doing so, (or similar interchangeable or substitute Articles, or parts thereof) to anyone other than Buyer, the burden shall be on Seller to establish that Buyer’s Information, funding or tooling was not used.” 2021 T. C. Memo. 1, at pp. 4-5.

The agreement also states that whatever Seller produces is work for hire per Copyright Laws, and if a court ever decides it isn’t, Seller assigns it to Buyer in advance. That means it’s the Buyer’s.

Of course, Seller can use the info if Buyer consents, but there’s no limit on Buyer’s discretion.

Reg. Section 1.41-4A(d)(3)(i) says that the researcher gets the credit only if it retains substantial interests in the research. Seller can’t even keep any of the Information if Buyer wants it back.

Summary J for IRS.

I’m obliged once more to Dickens for the title of this blogpost. Karen D.Foxx, Docket No. 17625-19, filed 1/11/21, got two different W-2s for the same year from her employer, each showing different wages.

Seems Karen wasn’t the only employee of the Nebraska Urban Indian Health Coalition (NUIHC) thus embrangled, but she didn’t respond to the CP2000. Her boss, however, timely submitted some correspondence that explained Karen’s fix. This was treated as a petition; Karen was ordered to ratify, but it’s not clear she did. After the petition arrived at Appeals, IRS dropped any claim for tax or chop, and sent Karen decision docs so stating.

I won’t get into the issue whether the CEO of NUIHC is entitled to enter a Tax Court appearance when NUIHC is not the taxpayer. Karen’s story would end here, but for the arrival of an attorney, whom I’ll call Mikey. Mikey files Entry of Appearance, has a couple phonecalls (hi, Judge Holmes) with IRS, and gets new decision docs naming him as attorney.

These get signed off in less than three weeks. Mikey then asks for admins and legals of $6800.

“In this case, the IRS received third-party information that petitioner received two Forms W-2 from NUIHC – one reporting wages of $36,750 and another reporting wages of $50,350. In light of this information, respondent was justified in seeking clarification from petitioner regarding whether she received wages of $36,750 that she failed to report…. Unfortunately, petitioner failed to provide information to respondent to assist in resolving these questions, leading to the issuance of the notice of deficiency.” Order, at pp. 3-4.

So IRS is justified. When there are facts involved, IRS is entitled to time to get the facts, review what substantiation is proffered, and reach a result. Here IRS acted reasonably.

STJ Panuthos is his usual genteel self. “Although respondent contends that the claimed litigation costs are unreasonable, we need not resolve that question in disposing of this motion.” Order, at p. 3, footnote 2.

Even though Mikey’s involvement predates COVID-19, hard times are no excuse for this.

Mirabile dictù! Son of a fowling piece! Ma foi! There are 78 (count ’em, 78) Tax Court orders on the website today, with a précis of each.

The orders themselves are printed in a quality format, much different from old typewriter-style documents formerly posted.

In short, the website cleans up halfway fair.  Some of my numerous objections have been directly addressed, lowering my blood pressure and sparing my readers yet another rant.

Edited to add, 1/12/21: Ch J Maurice B (“Mighty Mo”) Foley heralds the great event. Maybe this link will work.

I entitle some new information as to the now-much-discussed launch of DAWSON, with the 1942 Cagney Brothers’ Canadian epic.

The aim of DAWSON was to migrate the United States Tax Court’s online operations from Tax Court’s own servers to The Cloud. But in trying to “slip the surly bonds of earth and join the tumbling mirth” of Cloud, DAWSON has, as has been noted by commentators other than me, resulted in a penguin march.

My sources inform me that the end-of-month revisions will unseal the case noted by Mr. Weston in his comment to my blogpost “Yes, We Have No Opinions,” 1/4/21. The Genius Baristas, with zeal for secrecy unmatched in The City Under Siege since the days of Deep Throat, decided that if any document in a case was sealed, the entire case file should be sealed, including without in any way limiting the generality of the foregoing, orders, opinions and decisions. Apparently, they never asked anybody about this brainstorm.

Orders and opinions will be unleashed at month’s end. What sort of judicial tsunami this will create is unknown. Remember that in pre-DAWSON days, the average daily release of orders amounted to some 150 to 200. A two-month backlog should result in some 6000 orders being released, whether in one gigantic deluge or over a few days. How anyone is supposed to scan and decide which of these is worthy of note is nowhere explained, as my sources confirm that the day of the designated hitter is gone forever.

My sources also tell me that orders will no longer be text-searchable. However, the Genius Baristas have devised a method whereby the inquirer can find out how many pages (or perhaps kilobytes) each order contains, from which one is expected to discern the importance of each.

It did not occur to these monuments of unageing intellect that, by this criterion, any of the novels of Edward Bulwer-Lytton (inspiration for the contest to write the worst opening sentence of a bad novel) would surpass The Sermon on the Mount, Magna Carta, the Declaration of Independence, the Constitution of the United States, and the Gettysburg Address. Put together.

The concocters of this present (sorry, I am at a loss for a descriptor fit for family reading) are apparently a fresh set of Genius Baristas, successors to the crew which gave to a public, that never did them any harm but who paid for that (see previous parenthetical) with their taxes, the July debut of the new, improved, jazzy website. See my blogpost “If It Ain’t Broke, Don’t Fix It,” 7/20/20.

I cannot ascertain how the Chosen Few, who it is said commented on the design and implementation of DAWSON, were selected.

The public deserves to know, in reasonable detail, how the project was conceived, designed, and implemented. And what did this cost the American taxpayer and the Tax Court litigants so far?

Most importantly, we need a system that is transparent, user-friendly, and accessible even by the technophobic Luddite.

Having requested comments from Public Affairs, I have received none at time of publication.

I welcome comments and corrections.

No, I am not expanding on my comments made yesterday; at least, not here. I have said a lot, and shall continue to say a lot, elsewhere. This blog remains non-political.

I note that US Tax Court has announced that it will be closed on January 20, 2021, Inauguration Day, although teletrials will proceed

I had promised a commentator on this my blog that I would have more to say about the troll-out of DAWSON “at no very distant date.” See my blogpost “Yes, We Have No Opinions,” 1/4/21.

I had prepared “more to say” in writing, and used as my template Rule 71. I was going to send this to the Court on January 6, 2021, but events that date overtook me. So I have set aside my document until calm is restored in Our Nation’s Capital.

But what is happening today is not a political matter. This is an attempted coup in the middle of an epidemic. Not since 1860 has this country been in such danger as it is today. Whatever the course of the epidemic, and whatever the outcome of this coup, there will never again be a “normal” such as we formerly knew.

Again, I quote Goethe: “Today a new world begins.”

I take my title from Sellar and Yeatman’s 1930 comic classic. I take the statute cited therein from Title 26 of the United States Code.

Again, the new, improved (are we having fun yet?), jim-dandy website has no opinions today. And again, I’ve left voicemails seeking enlightenment as to today’s unsearchable and inscrutable orders with Ch J Maurice B (“Mighty Mo”) Foley’s chambers, and the hardlaboring Clerk’s office. I’ll report any responses.

As I said in my blogpost “26 USC §7461,” 11/13/19, “… Tax Court orders are where it’s at. It took me some time, but when I stated early on in this bloging life I lead that I would ignore small claimers and orders, I was utterly wrong.

“If anyone wants to see the gears meshing (or grinding), the wheels turning (or screeching to a halt), and which way the smoke is blowing, the orders are essential. The Stealth Subpoena is just one example; all the discovery moves, all the variances between Tax Court Rules and FRCP, all the gambits, are in the orders.

“If you’re trying to figure out Tax Court law and practice by reading between the lines of published opinions and designated orders, all you will see is white paper. Many orders that should be designated aren’t. Most opinions feature tax law; Tax Court procedure is definitely a long way behind, if it gets there at all.

“Shut down the orders search function, and I might as well pick up this electronic soapbox and go home.

“So what price Section 7461?”

Section 7461 says all proceedings at the Glasshouse Submerged in Dawson’s Creek are, and of right ought to be, public. That means orders.

I did reach the Public Affairs Officer, who assures me that the daily orders link-up will occur by the end of the month.

If anyone thinks this exonerates the Genius Baristas from responsibility for the monumental stramash that is the troll-out of DAWSON, I most respectfully differ.