No, this is not an essay on tariffs and trade. Rather, ex-Ch J L. Paige (“Iron Fist”) Marvel Judge-‘splains the broad discretion for releasing (or not) NFTLs.

Bobby G. Glaser and Cathleen A. Glaser, T. C. Memo. 2025-66, filed 6/23/25, want IRS to lift the NFTL imposed when they renegotiated their existing IA to pick up two (count ’em, two) new years.

The Letter 2603C that granted their requested revision stated “Although you made arrangements with us to pay your tax monthly, if you don’t pay the entire amount you owe by May 08, 2023, we may file a Notice of Federal Tax Lien to protect the government’s interest.” T. C. Memo. 2025-66, at p. 3. The Glasers didn’t pay, IRS filed the lien, and the Glasers petitioned Appeals’ sustentation thereof.

But the Glasers don’t show that IRS didn’t follow procedures, and the Letter 2603C properly reserved IRS’ right to file the NFTL. Nor did the Glasers show that the NFTL impeded their ability to pay pursuant to their revised IA.

That their pre-amendment IA didn’t result in a NFTL is nothing to the point. To get it lifted, proof is needed that the NFTL does more harm than good.

NFTLs protect the government’s position until payoff.

Now that the ice hockey season is over, the title or caption first above written at the head hereof (as my expensive colleagues would say) is no long applicable. It was never applicable in United States Tax Court, as Judge Adam B. (“Sport”) Landy makes clear in Ringer Road Rock & Timber, LLC, Ringer Road Manager, LLC, Partnership Representative, Docket No. 7123-24, filed 6/23/25.

The Ringer Road Rockers have nothing to do with this. Rather. IRS is trying a flying line change, on which Judge Sport Landy blows the play dead.

“Jordan S. Musen filed a Notice of Withdrawal for Catherine J. Caballero. That ‘Notice’ states that it was filed on behalf of Catherine J. Caballero. But that ‘Notice’ did not seek to withdraw the appearance of a counsel for respondent who has properly entered an appearance in this case. This Notice seeks to remove Ms. Caballero from among the counsel of record.” Order, at p. 1.

According to a quick docket search, apparently Jordan S. Musen was withdrawn as counsel for IRS back on 4/1/25, but maybe that was an April Fool’s joke. Howbeit, in or out, s/he is going about it the wrong way. Judge Sport Landy puts CatCab back.

“Rule 24(c) allows an attorney to withdraw by notice in limited circumstances, but that rule is clear, ‘Counsel desiring to withdraw as counsel may file a notice.’ It does not permit one attorney to file a notice and thereby remove another attorney. As a consequence of their filing of a Notice of Withdrawal of Counsel, Ms. Caballero was improperly removed as counsel in this case. Rule 24(c) provides three options for an attorney to be withdrawn from a case. As relevant here, Rule 24(c)(1) sets forth the limited circumstances in which an attorney can withdraw himself or herself as counsel. If those limited circumstances are not met, such as if one attorney is attempting to remove another attorney, then a Motion must be filed under Rule 24(c) v(2) or (3). Rule 24(c)(3) is captioned Motion to Withdraw Counsel by Party. In this instance, the attorney who filed the improper notice represents a party (respondent), and as counsel of record for a party, he may file a motion on that party’s behalf to have another attorney removed.” Order, at p. 1.

Taishoff says I suppose any attorney seeking to remove another attorney must at least represent a party for whom the attorney sought to be removed had filed EoA. And at the time seeking to remove the other, must him/herself currently have on record an EoA to represent that party. Remember, withdrawal by notice is not the same as withdrawal on motion. I covered this in my blogpost “Firm EoA – Again,” 5/5/25.

There’s a multifaceted discovery joust in Mohammad Fawad Aryanpure & Malika Aryanpure, Docket No. 17120-23, filed 6/20/25, with Judge Ronald L. (“Ingenuity”) Buch taxing his ingenuity to sort out what Mo & Mal have to tell IRS, and vice versa.

Since most of this is intensely fact-bound, I’ll leave it to the discovery geeks among you to delve deeply. I’m looking for the broader issue, namely, viz., and to wit, IRS’ exam and interview notes. IRS’ notes, memoranda, and casual jottings may not be privileged; as always, it depends.

“Petitioners seek access to a number of documents in the administrative file that respondent contends are covered by attorney-client, deliberative process, and work product privileges. However, their arguments against privilege generally do not withstand scrutiny. Furthermore, petitioners have not identified any authority to support their contention that the Commissioner must personally assert the deliberative process privilege. Cf. Marriott Int’l Resorts, L.P. v. United States, 437 F.3d 1302, 1307–08 (Fed. Cir. 2006) (recognizing that the authority to assert deliberative process privilege may be delegated). Accordingly, this Court will not consider the government to have waived privilege with respect to any such documents that may be relevant.

“However, this Court agrees with petitioners that notes or memoranda of interviews conducted during the IRS examination may potentially not be subject to privilege. Respondent’s privilege logs provide insufficient information to assess the claimed privileges. Furthermore, this Court is not in a position to assess the potential relevance of the materials. This Court will order respondent to supplement the privilege logs with respect to the notes and memoranda of interviews identified by petitioners…  to provide additional information for those documents being withheld. Petitioners remain free to challenge respondent’s privilege log, as supplemented, and the Court will consider in camera review with respect to any particular items identified by petitioners as potentially relevant and still sought at such juncture.” Order, at p. 5.

Practitioners, maybe so might could be there’s gold in them back-of-envelope scrawls an RA threw in the bottom of the file folder.

Instead of waiting fifty (count ’em, fifty) years, our National legislative process has given over a day in mid-June annually for the Leviticus 25:10 treatment.

US Tax Court is therefore shut up, and so am I.

No, not the enlisted crew hangout on the Starship Enterprise, rather this is the agent of downfall of IRS’ deficiency case against Luis Carlos Ibarra Cano, T. C. Memo. 2025-65, filed 6/18/25.

LCIC is 400 days late with his petition, and IRS wants summary J tossing the petition for want of jurisdiction. IRS gets that, but not for the reason they wanted (late petition); it’s not sent to last known address, hence defective.

Judge Albert G. (“Scholar Al”) Lauber tells the story.

“Petitioner’s last known address when the Notice of Deficiency was mailed was 220 6th Street, Hempstead, Texas 77445. The Notice was erroneously addressed to him at 2206 TH St. Hempstead, TX 77445-4761. A U.S. Postal Service (USPS) Form 3877, Firm Mailing Book for Accountable Mail, shows that the Notice was sent by certified mail to 2206 TH St. Hempstead, TX 77445.” T. C. Memo. 2025-65, at p. 2.

Usually typos in addresses don’t invalidate SNDs. But this one is over the limit.

“The Notice and the Form 3877 both show an incorrect address for petitioner. The error evidently arose from the transposition of the digit ‘6.’ But this is not a harmless typographical error, as might exist (for example) if the word ‘Street’ had been misspelled. Both documents showed what was almost certainly a nonexistent address. On the record before us, we have no way of knowing how the USPS would have handled delivery of this Notice of Deficiency.” T. C. Memo.  2025-65, at p. 3.

Given a $4K deficiency, is it worth IRS’ while to subpoena an IRS official to testify, especially when LCIC doesn’t even bother to show up for the trial? Of course, LCIC may have known the SND was defectively served, so didn’t waste his time.

IRS argues that the fact LCIC petitioned shows he got the SND timely. Scholar Al doesn’t issue “oh, please”s, but this time he should.

“The fact that petitioner attached to his Petition a copy of the mis-addressed Notice, respondent says, ‘establishes that petitioner received the [N]otice without delay, which proves that the [N]otice is valid for purposes of conferring jurisdiction on the Tax Court.’ We do not reach the same conclusion. Petitioner petitioned this Court… 400 days after the Notice was mailed. This hardly proves that he actually received the Notice ‘without delay.’” T. C. Memo. 2025-65, at p. 4.

Someone somewhere failed to hit the space bar on the keyboard, so “200 6th St” became “2006 TH St.” Looks like they need a proofreader.

Judge Christian N. (“Speedy”) Weiler belies his cognomen as he puts the brakes on Brank Cove Capital, LLC, Gene Larson, Tax Matters Partner, Docket No. 12074-20, filed 6/17/25. After the trial, which is virtually a petitioner’s laydown, just as IRS was lining up the 40% substantial overvaluation chop, petitioner’s trusty attorneys trotted out the Seventh and Eighth Amendment jury trial and excessive fines argument.

“Petitioner also cites to a case pending before then United States Court of Appeals for the Eleventh Circuit dealing with this issue. As previously noted, the Court also has a case pending in which the same or similar issue has been raised. At the suggestion of petitioner, we are inclined to await entering a decision in this case and allow the parties to submit post-trial briefing on this legal issue—should they choose to do so. Accordingly, we will not enter a Decision at this time.” Order, at p. 1.

So let the parties file some status reports.

AbbVie Inc. and Subsidiaries, 164 T. C. 10, filed 6/17/25, undertook to merge with an offshore in a stock-for-stock swap with a new subsidiary. The offshore, Shire, undertook to effect the merger. Problem was, both sides had shareholders, unrelated to themselves and to each other, who had to agree.  So all they could agree to in a Co-operation Agreement was to convince the shareholders to agree.

Problem was, Treasury issued Notice 2014-52, 2014-42 I.R.B. 7, casting serious shade on the tax impact of the proposed deal. Whereupon, AbbVie’s Board chickened out, pulled its recommendation to its shareholders, and agreed that the Co-operation Agreement required AbbVie to pay $1.635 billion-with-a-b to Shire as a Break Fee. 164 T. C. 10, at p. 7. See 164 T. C. 10 at p. 8 for the Termination Agreement that followed.

AbbVie took an ordinary loss, claiming contract abandonment. IRS said Section 1234A made the loss capital, in that it was the abandonment “with respect to property which is (or on acquisition would be) a capital asset in the hands of the taxpayer.”

Judge Emin (“Eminent”) Toro says this isn’t a capital asset, because property isn’t involved. The deal involves stock that neither AbbVie nor Shire owns or controls. There’s a bunch rights and obligations (hi, Judge Holmes) that AbbVie abandoned, but none of them involves property, because neither AbbVie nor Shire owns the stock.

There’s a major dictionary chaw, as is obligatory. But the story is simple: it’s not property.

And the Ice Thin

When Billy Long’s myrmidons are radar-locked and the dragnets deployed, the practitioner, dragged in at the last red-hot minute, is thrust on her/his mettle. The faint-hearted need not apply. So enter no less than The Great Chieftain of the Jersey Boys, to whom the above set forth conditions provide opportunity, not dread.

Back in April, IRS issued a trial subpoena duce tecum to nonparty whom I’ll call GC. Two (count ’em, two) days before return date, a principal of GC, whom I’ll call Richie, files through trusty attorney a motion to quash.

The sun is bright and staring; the transparent ice shows beads of moisture. Judge Albert G. (“Scholar Al”) Lauber is in no mood for last-minute derailments.

“In his Motion [Richie] erroneously states that trial starts June 16 and represents that his condition makes travel and ‘prolonged oral responses’ difficult. In fact, the trial of this case does not start until October 20, 2025, as noted in the subpoena. The upcoming hearing on June 18 will not require substantive testimony from [Richie]. Rather, it will be a brief zoom.gov proceeding focusing on the documents specified in the subpoena, and [Richie] or his counsel may attend remotely.” Order, at p. 1.

As the midnight telehucksters say, “But wait! There’s more!”

“[Richie] also argues that the subpoena is ‘overly broad’ and ‘imposes an undue burden.’ But the subpoena was issued on April 23, and he had almost two months to move to narrow or quash the subpoena on that ground. It is unreasonable to move to quash on this ground two days before the hearing. We will accordingly deny the Motion.” Order, at p. 1.

The Order is Ivey Branch Holdings, LLC, Ivey Branch Investors, Tax Matters Partner, Docket No. 19189-19, filed 6/17/25, docket item 196.

Wet feet included at no extra charge.

It’s a tried-and-true failure, but Steven J. Schwartz, T. C. Memo. 2025-64, filed 6/16/25, tries it on again. Steve (that’s Doc Steve) wants his unpaid 1040-ES for a couple years (hi, Judge Holmes) folded into his IA.

As the Appeals officer noted, Dr. Schwartz was not in compliance with his estimated tax obligations for 2022 or 2023, part of a pattern of significant underwithholding of tax stretching back to at least 2017. Dr. Schwartz does not assert that he was in compliance with his estimated tax obligations. He instead offers a strained and tendentious reading of the Internal Revenue Manual that would require the Appeals officer to grant Dr. Schwartz an installment agreement that included the delinquent estimated tax payments.” T. C. Memo. 2025-64, at p. 7.

Ch J Patrick J. (“Scholar Pat”) Urda isn’t having any.

“We have repeatedly rejected the argument Dr. Schwartz urges here.” T. C. Memo. 2025-64, at p. 7.

There follows somber reasoning and copious citation of precedent. Yes, the AO could have let Doc Schwartz fold his unpaids in, but committed no abuse of discretion in not doing so.

The touchstone for jurisdictional basis, the key to the key to the Glasshouse door, is the mailing of the SND or NOD. This has been catechized to us all again and again. The USPS Form PS3877, describing item mailed, to whom and to where, and stamped and signed by USPS employee, thus far closes the case. In a deficiency case, game over, right?

Maybe not, say the trusty attorneys for D. Brent Scarbrough & Tina M. Scarbrough, Docket No. 9516-24, filed 6/13/25.

By my calculation, DB & Tina are 269 days late with their petition. They claim they didn’t get the SNDs (two for each as two years at issue) until a week before they petitioned. IRS replies “so what, we mailed ’em, you’re in 11 Cir, no equitable tolling.”

But trusty attorneys (whom I’ll call The Wigs) cite a couple cases (hi, Judge Holmes) that call this time-honored mantra into question.

“…petitioners insist that respondent has not met his obligation under section 6212 because alleged internal errors at the USPS resulted in non-delivery of the Notices, and respondent had knowledge of such and did not remedy the issue. Relying on Estate of McKaig v. Commissioner, 51 T.C. 331 (1968) (holding the notice insufficient when the USPS informed IRS that the notice of deficiency had not been delivered and taxpayer’s last known address was in question), petitioners argue that respondent had knowledge that delivery was not completed for at least three of the four Notices, and consequently, petitioners are entitled to equitable tolling from when they received the 2020 Notice on June 3, 2024. Notwithstanding, petitioners conceded that the certified mailing lists, attached to respondent’s motion, are properly completed and authentic.” Order, at pp. 2-3.

As usual, it’s in the footnotes.

The Wigs noted that USPS online tracking shows only one of the four (count ’em, four) SNDs were actually delivered, so IRS should have known something was up. Order, at p. 2, footnote 2.

“A properly completed PS Form 3877 (or certified mailing list) is direct evidence of both the fact and date of mailing and, in the absence of contrary evidence, is sufficient to establish proper mailing of the notices. The parties concede that the certified mailing lists for the years at issue attached to respondent’s Motion are properly completed and bear sufficient indicia of authenticity. Finding no evidence to the contrary, we accept the foregoing documents as presumptive proof of its contents.” Order, at p. 4, footnote 3.

For their efforts, The Wigs get from Taishoff a “Good Try, Third Class.” From Judge Adam B. (“Sport”) Landy, they get a toss of the petition. No jurisdiction.