No, not the 1971 Clint Eastwood thriller; this is the story of Misty S. Doonis, 2014 T. C. Memo. 168, filed 8/18/14, as told by Judge Lauber.

Misty missed two years’ worth of 1040s, so IRS obligingly prepared SFRs for her and gave her SNODs for each at no extra charge. Misty never bothered to petition either SNOD, so IRS assessed tax and gave Misty a Final Notice of Intent to Levy and Notice of Your Right to a Hearing.

This gets Misty’s attention, and she asks for a CDP. “In her request, petitioner asked that her account be placed in currently not collectible (CNC) status or, alternatively, that the IRS consider a collection alternative in the form of an installment agreement or offer- in-compromise.” 2014 T. C. Memo. 168, at p. 3.

The SO asks Misty for a Form 433-A wage earner and SE tell-all, which Misty proffers timely. OK so far.

One minor problem. In addition to the two unfiled years, Misty has five (count ‘em, five) other unfiled years, so before the SO will hear Misty’s plea, she must come up with the returns.

And she does. All but one.

SO says that Misty’s income well exceeds local and national standards, per the returns she did file (each of which show a hefty balance due).

“Petitioner requested an installment agreement or an offer-in-compromise. Both collection alternatives require that the taxpayer be in full compliance with filing required tax returns. Petitioner concedes that she did not file a tax return for 2005.” 2014 T. C. Memo. 168, at p. 7. (Citations omitted).

It doesn’t get better. “Petitioner first argues that the SO should have excused her failure to file this return because ‘she did not have sufficient records to file a tax return for 2005.’ This excuse is unavailing. Taxpayers are required to keep and produce adequate records that enable the Commissioner to determine the correct tax liability. This is an affirmative duty placed on the taxpayer, and an unexplained failure to maintain adequate records is no defense to the duty to file a required return.” 2014 T. C. Memo. 168, at pp. 7-8. (Citations omitted).

Ya gotta give Misty and her lawyers credit for trying.

“Petitioner next contends that she had ‘no reported income for tax year 2005 per the IRS wage and income transcripts.’ Petitioner is a self-employed medical recruiter who earned Schedule C business income averaging in excess of $78,000 for 2006-2012. On her Schedule C for 2006 she did not check the box for designating that she ‘started or acquired this business during 2006.’ This implies that she was engaged in her medical recruiting business during 2005. Petitioner has set forth no specific facts, by affidavit or otherwise, tending to show that she did not work in her business during 2005; that she earned no income in 2005; or that the income she earned in 2005 was below the threshold requiring her to file a tax return. See sec. 6012(a).

“The fact that the IRS transcript of petitioner’s 2005 account shows no third-party reporting of payments to her does not imply that she received no income for 2005. Self-employed individuals are not subject to reporting on Form W-2, Wage and Tax Statement, and they often are not subject to reporting on Form 1099-MISC, Miscellaneous Income, either. Petitioner has set forth no specific facts, by affidavit or otherwise, indicating how many clients she had, how those clients paid her, and whether those clients generally supplied the IRS with Forms 1099-MISC reporting the income that she received.” 2014 T. C. Memo. 168, at pp. 8-9.

Finally, Misty and lawyers claim the IRS Manual says IRS won’t ask for returns more than six years old, and the missing return is one such. Great, says Judge Lauber, but “We have previously found no abuse of discretion when an SO required a taxpayer to file returns going back more than six years. The IRM, which includes Policy Statement 5-133, does not have the force and effect of law but provides only direction and guidance.” 2014 T. C. Memo. 168, at p. 9. (Citations omitted).

Rather like the Pirates of the Caribbean, the IRS Manual and Policy Statements therein set forth are “guidelines…aspirational goals.”

So Misty has to pay up. The SO was right in not putting Misty in CNC or putting her on  the installment plan, because she has money.

No, not Robin Williams (although I much lament his passing).

Rather, I somewhat belatedly note the passing on June 3, 2014 of Blonde Grayson Hall, Esq., star of my blogpost “When All Else Fails”, 4/4/13. Whatever her subsequent delictions, she was a member of the initial steering committee of the President’s Council of Cornell Women in 1990. Hail, all hail, Cornell!

I was made aware of Ms. Hall’s decease from Judge Ruwe, who filed an Order 8/18/14 in Blonde Grayson Hall & Neal E. Hall, Docket No. 353-12*.

*Blonde Grayson Hall 8 18 14

It’s a slow summer Friday in Tax Court, 8/15/14. I was casting about for something to blog, and was so far down the path to deserved obscurity that I was about to edify my readers with IR-2014-80, 8/12/14 (talk about yesterday’s papers), wherein IRS was announcing proudly that “its cornerstone ‘Taxpayers Bill of Rights’ document is now available in six languages.

“Newly-revised versions of Publication 1, Your Rights as a Taxpayer, are now posted on IRS.gov in English, Spanish, Chinese, Korean, Russian and Vietnamese.”

For more, see my blogposts “Righting a Wrong”, 6/14/14, and “Somebody Does Read This Blog – Part Deux”, 6/14/14.

Had somebody told me fortyfive years ago today that IRS would be publishing the “cornerstone Taxpayers Bill of Rights document” in Vietnamese, my reply would have contained many of Mr. Spock’s colorful metaphors. Well, live and learn.

But I have something better. Ch J Michael B. (“Iron Mike”) Thornton always has his eye on the essential, and lets nothing get in the way.

Case in point: Robert E. Zorn, Docket No. 15573-14, filed 8/15/14. Rob starts off in the usual way, with a petition. But he doesn’t bother sending in the sixty buck filing fee or a waiver request.

Ch J Iron Mike gives Rob the usual second chance to pony up or plead poverty. Rob replies to Ch J Iron Mike with “various largely unintelligible or nonsensical communications from petitioner that suggested petitioner would not be coming forward with the filing fee.” Order, at p. 1.

So Ch J Iron Mike, who will let you into Tax Court if you send in a money order, even without a petition (see my blogpost “Show Me The Money”, 11/13/13), tosses Rob.

But Rob, quick off the mark, sends in an Application for Fee Waiver. And Ch J Iron Mike buys it, because it might have crossed in the mail with the tossing Order, and tosses his toss, letting Rob in.

So remember Ch J Iron Mike’s cornerstone rule: Show Me The Money.

Long-suffering readers of this, my blog, will remember the sad tale of Lisa Laflamme, Florida real estate person, who put her retirement contribution on the wrong line of her return, and was rescued from a Section 6662 chop by Judge Vasquez, as more particularly bounded and described in my blogpost “Whose Line Is It, Anyway?”, 2/8/12.

Today’s sermonette focuses upon another misplaced entry, but here the taxpayer is seeing double. This is the tale of Robert S. McQuate and Linda S. McQuate, 2014 T. C. Memo. 165, filed 8/14/14, as told by Judge Ruwe. Or rather, it’s partly the tale of Rob Mac and Lin Mac, but also the tale of their attorney, whom I shall hereinafter designate as Max.

Rob Mac and Lin Mac had an S Corp that performed consulting services. For the year at issue, the Sub S consulted with A, a partnership in which the Macs were partners, and got paid $59K, which turned up on the S Corp’s 1120S in the right place. But the Macs reported neither gain nor loss from A.

When, two years later, A finally sent the Macs a K-1 for the year at issue, it showed a guaranteed payment and an ordinary loss, which netted out to a $900 loss, and the Macs filed a 1040X with the revised numbers timely, asking for a refund.

Three years later, but still timely, IRS dropped a FPAA on A, and cut the Macs’ ordinary loss by two-thirds. The Macs and the A tax matterer did not petition the FPAA.

IRS hits the Macs with a deficiency of $15K. The Macs claim they picked up the right numbers on their original 1040, and didn’t remember, when they filed the 1040X, that the numbers A’s accountant put on the K-1 were wrong, because the Macs gave at the office, having picked up the right number years before.

Well, the Macs get a SNOD, petition, and with a quick exchange of 1040, 1120-S and 1040X (with the ledger from the Sub S showing the right payment), the deficiency gets erased.

So why am I telling you this? Because Max wants $27K in legal and administrative costs and fees, and the Macs file a Section 7430 petition in support thereof.

Max wants costs for years other than the one at issue, and that’s a nonstarter. “Petitioners ask that we award costs incurred with respect to taxable years that are not before the Court. To do so would exceed our jurisdiction and on this record would be inappropriate.” 2014 T. C. Memo. 165, at p. 4, footnote 2.

You can see this is off to a bad start, and it doesn’t improve. “Petitioners’ counsel did not provide a detailed schedule of the litigation and administrative costs incurred with respect to the [year at issue] Petitioners concede the reasonableness of respondent’s litigation position.” 2014 T. C. Memo. 165, at p. 5 (Footnote omitted, but Judge Ruwe therefore blows off the litigation fees).

So we’re left with administrative costs. And justification. Was the IRS justified, that is, would a reasonable person conclude that, as the moment the SNOD issued, the IRS was right based upon what information it had at the moment? That later information was provided, and that IRS thereupon folded, does not mean that IRS wasn’t justified.

Not until IRS got the ledger and the 1120-S could IRS have figured out that the Macs gave at the office. Max bombarded IRS with correspondence before then, and Judge Ruwe summarizes it. All Max told IRS was about other years and a non-receipt of a refund on the 1040X; Max never mentioned the year at issue until post-petition.

So no go.

Incidentally, “Respondent argues that the attorney’s fees are unreasonable. We need not address this issue since we have determined that respondent’s administrative position was substantially justified.” 2014 T. C. Memo. 165, at p. 11, footnote 5.

Takeaway- The time to win a Section 7430 is at examination. I know that this was a very tough case, because the K-1 came long enough after the year at issue so that memories were obscured, and the FPAA was a distraction. Again, keep good billing records. And litigation and administrative fee cases are very, very tough to win.           

But nobody went free. That’s Judge Buch’s holding in John C. Bedrosian and Judith D. Bedrosian, 143 T. C. 4, filed 8/13/14. So Justice Cardozo’s famous dictum goes by the boards.

IRS made hash of the audit of John and Judy’s 1040, missing the Son-of-Boss LLC and Sub S hidden in the partnership John and Judy concocted to lay off a humungous capital gain with Bialystoked capital losses. The partnership filed a 1065 with such gems as calling the LLC an “individual”, claiming it wasn’t subject to TEFRA but nevertheless appointing a tax matterer, and listing the Sub S as a partner, clearly taking the partnership out of the small-partnership exemption from TEFRA.

So IRS starts auditing John and Judy’s 1040. Meanwhile, back at the cliché, the SOL runs on the Bialystok partnership year. Waking up, IRS then starts a TEFRA on the loss carryforward year, with a NBAP and a FPAA, that John and Judy claim they never got, but Judge Buch goes off on “last known address.”

There’s much litigation, IRS telling different stories that John and Judy claim are frauds (and majority and dissent joust over how badly IRS besmirched themselves), several orders and opinions, all holding that Tax Court has no jurisdiction because John and Judy elected out of TEFRA too late and anyway IRS couldn’t reasonably decide that the partnership wasn’t subject to TEFRA. Oh yes, John and Judy fork over $4 million to IRS.

They run to Ninth Circuit, who holds that there’s no jurisdiction for two of John and Judy’s claims, and as to the third, there’s no “judgment” (by which I suppose Ninth Circuit means “decision”, that is, determining liability).

Judge Buch and the majority have much to say about “law of the case”, which is what I want to discuss. Judge Buch: “The ‘law of the case” doctrine ‘posits that when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case.’ It has been recognized and repeatedly applied by this Court and by the Court of Appeals for the Ninth Circuit… and precludes reconsideration of an issue that has been decided in this case…. The issues that a lower court is precluded from reconsidering ‘include those that were decided by the appellate court expressly or by necessary implication.’” 143 T. C. 4, at pp. 49-50. (Citations omitted).

Now Judge Vasquez and the dissenters (JJ Colvin, Foley and Ch J Thornton, not conspicuously pro-taxpayer judges) argue that the points of law supposedly decided by Ninth Circuit are dicta, not necessary to the holding. IRS’ botched handling of this case shouldn’t deprive John and Judy of their day in Court.

And Judge Goeke, concurring in result, says the Ninth Circuit’s ruling was dicta, so stick with the Tax Court rulings and forget about the Ninth Circuit affirmance, and John and Judy still are out.  Judge Paris agrees.

Judge Halpern concurs, saying John and Judy had their chance and they blew it.

Takeaway- Watch those orders and opinions. They can sink you.

Footnote- I wonder why, after having forked over $4 million, John and Judy didn’t sue for a refund. SOL?

That is, elegy for a very interesting tax scam, that takes place in a graveyard. And the moral is that even a completely defective petition, if filed out of a FPAA, tolls the statute of limitations for both the partnership-level and partner-level determinations. And even more so if the partner files bankruptcy.

Here’s Judge Nega to tell you all about it, in Michael J. McElroy and Ruth M. McElroy, 2014 T. C. Memo. 163, filed 8/12/14.

Mike Mac succeeds inventive Glenn R. Johnston as tax matterer of several general partnerships, all bearing the title Heritage Memorial Park. Inventive Glenn is taken out of the play by the Federales, copping to “one count of conspiracy to defraud the United States by selling, claiming, and causing others to sell and claim millions of dollars in false and fraudulent tax deductions for charitable contributions and concealing from the IRS income from the sales of the fraudulent deductions.” 2014 T. C. Memo. 163, at p. 8.

Inventive Glenn gets a “get into jail free” card.

I give Inventive Glenn a Taishoff “good try in the first degree”. Inventive Glenn rounds up fewer than 100 highrollers for each of his general partnerships, and buys up cemetery plots for not heavy-duty cash (as those highrollers reckon heavy-duty cash). They then mark up the plots by a lot (we don’t hear about the appraisals from Judge Nega, but they must put the historic façadeniks in the shade), and contribute them to a 501(c)(3) cemetery, taking big charitable deductions.

The key, of course, is that there must be a one-year holding period in the gravesites, so they can be contributed at the marked-up FMV (which is beaucoup more than the highrollers paid for them).

Judge Nega explains: “The amount of the deduction for a charitable contribution of property depends in relevant part on whether the contributed property was held for over one year (in which case the deduction is the property’s fair market value) or for a lesser period (in which case the deduction is the taxpayer’s basis in the property). See sec. 170(a), (e)(1)(A); sec. 1.170A-1(a), (c)(1), Income Tax Regs.; see also sec. 1222(3) (providing that property may qualify for long-term capital gain treatment only if held for over one year).” 2014 T. C. Memo. 163, at p. 3, footnote 3.

Inventive Glenn and friends blow the one-year hold, so Mike Mac and Mrs Mac only get their minimal basis for the deductions.

However, the legal issue (“At last!” say my few readers so far still above-ground) is whether the 3-year SOL has run on Mike Mac and Mrs Mac.

Inventive Glenn as tax matterer agreed to extend the SOL before he was investigated, but not afterward. IRS then served FPAAs, and Glenn petitioned, and agreed to continuances of trial while he was being investigated and pleading guilty.

After Inventive Glenn was in the slammer, IRS moved to toss him as tax matterer, and Mike Mac stepped in, solely for the partnership-level proceeding.

Mike Mac claims his own deficiencies arising out of the scam are barred by SOL, but Judge Nega says TEFRA keeps partners’ issues open while partnership-level items are being hashed out. Mike Mac claims that there was no partnership-level proceeding, because Inventive Glenn had no right to file the petition, as he was being investigated and therefore disqualified as tax matterer.

Doesn’t matter, says Judge Nega. There was a petition. Whether or not effective, the petition was timely filed, and that opens the box.

Anyway, Mike Mac later filed bankruptcy, and that converted his items from partnership-level to partner-level, per Section 6226. And gave IRS an additional one year from discharge to go after Mike Mac and Mrs Mac.

But whatever the theory, Mike Mac loses. The proper place to challenge the petition Inventive Glenn filed was at the partnership-level proceeding. Nobody did, and Judge Nega finds nothing wrong with that. And if Inventive Glenn was right to file the petition, the mere fact he was under criminal investigation doesn’t oust him as tax matterer, and Judge Nega has Second Circuit learning to back up that statement.

Cutting to the chase: “The long and short of this issue is that the… Forms 1065 were timely filed, the FPAAs were timely mailed to the partnerships’ TMP within three years after the returns were filed, and petitions were timely filed in this Court as to the FPAAs. The assessment periods as to the partnership items therefore remained open at the commencement of and throughout the partnership-level proceedings, as stated in section 6229(d). Then, when petitioners filed their bankruptcy petition while the partnership-level proceedings were pending in this Court, petitioner’s partnership items were recharacterized as nonpartnership items by operation of law, and respondent had at least one year thereafter to mail the deficiency notice to petitioners. See secs. 6229(f)(1), 6231(b)(1)(D), (c)(1)(E); sec. 301.6231(c)-7T(a), Temporary Proced. & Admin. Regs., supra. Respondent’s mailing of the deficiency notice to petitioners met that one-year requirement. The deficiency notice was therefore timely, and the applicable limitations periods remain open.” 2014 T. C. Memo. 163, at p.18.

I note in passing that both Gregory Scott Savoy and Janice Marie Cross are on deck today, Greg in a T.C. Memo. and Janice Marie in two designated hitters, all courtesy of that Obliging Judge, Judge David Gustafson. I’ll spare you the details; they are consistent with past history.

The statistics page on my blog tells me I have 104 followers, and ever so many views over the lifetime of this, my current literary effort (“a poor thing, but mine own”). Still, to have an occasional nod from the authors of the opinions and orders at 400 Second Street, NW, is a great pleasure.

Cf. (as my high-priced colleagues say) “Guess Who Reads My Blog?” 4/1/14, as the Second Street guys really put on a show.

And today, my “sardonic” self gets a wee tip of the hat in an order from that Obliging Judge David Gustafson, in Gregory Scott Savoy, Docket No. 12316-12L, filed 8/11/14.

Greg wants his case to proceed as “Anonymous”, even though there are 48 filings so far, all with his name on them. He claims he wants his medical history sealed (done back in February), and Judge Gustafson never mentioned Greg’s medical condition thereafter, but Greg did.

And Greg maintained other, related litigation not under seal, wherein the DCDC named Greg’s medical condition in quoting from the complaint therein.

Of course, Greg cannot remain anonymous.

But what caught my eye and gave rise to this blogpost is the following.

“Petitioner recently learned from an Internet search that, in July and September 2013, he was named in two ‘sardonic blog posts’ on the Internet. Those posts commented on this case and were occasioned by previous orders we have issued in this case. The blog posts did not name petitioner’s medical condition.” Order, at p. 2

Me, sardonic?

I would point out in passing that, in an exchange of e-mails on Friday, March 21, 2014, Mr Savoy mentioned his medical condition in general terms, and objected to my reportage of his case (and I did not then or thereafter mention his medical history). I must conclude that his internet search above-referenced took place some time before March 21, 2014.

I replied then, and reply now: “Mr Savoy, If you’re unhappy with the present laws, contact your Senators and Representative. They can change the laws; I can’t. If you are unhappy with Judge Gustafson’s decision, then appeal. The Circuit Court can overrule him; I can’t. And if you are unhappy with my present reportage, I cannot change that. I call ’em as I see ’em, and as I perceive how the Court calls ’em.”

But, sardonic or not, Judge Gustafson is a true First Amendment champion: “We will also deny the motion to the extent it asks us, in effect, to impose any ‘gag’ order or similar restriction on media discussion of this case. Apart from the impediments of the First Amendment (assuring ‘freedom of speech [and] of the press’–freedoms surely valued by petitioner, given his profession), any attempt by the Court to do so would surely backfire by calling much more attention to this case than it would otherwise receive.” Order, at pp. 3-4.

See my blogpost “Don’t Give a Sham”, 5/22/14, for background. Summarizing, this case involves a $33 million charitable deduction of a remainder in the membership interests in an LLC that is landlord of triple net leased property. IRS claims it’s about $29 million high.

Now, IRS moves for summary judgment in RERI Holdings I, LLC, Harold Levine, Tax Matters Partner, 143 T. C. 3, filed 8/11/14. But Judge James S. (“Big Jim”) Halpern is a firm believer that summary judgment is issue identification, not issue determination; and if the issue is a fact question, no summary judgment.

First is a prolonged joust over the applicability of the Section 7520 tables to valuing the remainder interest here. This I leave to the specialists, except to note that, although a single-member LLC is a disregarded entity for income tax purposes, a willing buyer of those interests cannot ignore the existence of the LLC in negotiating a purchase price for same, even if the single-member LLC has only one sole asset. The member’s interest is in the LLC, not the sole asset.

Of course, the membership interest may have no value apart from the value of the sole asset. And it doesn’t matter whether the membership interest (or the asset) is being valued for gift tax purposes or income tax purposes. The same tests apply.

There’s more jousting over whether the appraisal of the remainder interest is a “qualified appraisal” for Section 170 purposes, but we’ve been over that ground before (and in fact Judge Vasquez goes over it again today in Marco Zarlengo and Linda McMahon-Zarlengo, 2014 T. C. Memo. 161, filed 8/11/14), and in both these cases the appraisal survives the test as to regulatory compliance (although the resulting numbers in both cases encounter major judicial skepticism, Zarlengo’s going over the side altogether).

In fact, the very optimistic (shall we say) appraisal in RERI gets a yellow card from Judge Big Jim: “RERI’s contribution of the SMI [remainder interest] to the University resulted in a claimed deduction far in excess of RERI’s investment therein. That contribution was followed by the University’s sale of the SMI to HRK and HRK’s resale of it, which was followed, ultimately, by the last purchaser’s contribution of the SMI to another charitable organization, again allegedly resulting in a large deduction in excess of either HRK’s or the donor’s investment. That chain of events suggests the presence of a scheme to generate large deductions, through application of the sec. 7520 tables, for multiple charitable contributions of the same asset, in which each of the donors made a small investment. Such a scheme at least suggests tax shelter aspects that the parties may want to address at trial and on brief.” 143 T. C. 3, at p. 49, footnote 20.

The University got the remainder, subject to a hold-sell agreement, whereunder the University had to hold the remainder interest for two years (during which time the present interest was held elsewhere) and had to sell it at the end of the two years. The University got way less than the tax benefit to the donor.

And I note in passing that the donor is well-known New York City real estate entrepreneur Steven Ross, head of The Related Companies, builder of the Time-Warner Center, which “has transformed Columbus Circle into one of New York’s premier destinations”. Mr. Ross is also a major donor to the University of Michigan.

Full disclosure–both my mother and my nephew are alumni of that great institution.

No, not only the start of the grouse-hunting season, but the publication date of the new Whistleblower regulations.

And guess what? Not a lot has changed.

Here, check it out yourselves:

Click to access 2014-18858.pdf

It’s summertime, sure enough, but George and Ira to the contrary non obstante, as my out-in-the-Hamptons colleagues say, the livin’ ain’t easy for Tax Court bloggers on a Friday afternoon.

Opinions don’t show up on Fridays at any time of the year, as the crew at 400 Second Street, NW, seem to treat this day as the Day of Preparation, as that phrase was used in a much more exalted circumstance, long ago and far away.

So, lest my cherished readers, few in number but independent of spirit, jump ship if they find nothing but yesterday’s blogpost on my site today, I am doing the blogger’s equivalent of ducking for apples among the orders, all seven pages’ worth (at 25 orders per page). And a toilsome business it is.

But that Obliging Judge, Judge David Gustafson, lays a designated hitter on us. There are actually two orders, but they’re a coupled entry; metaphors from the racetrack and the diamond follow, to suit the season.

And the King of Cutesy has thirty (count ‘em, thirty) of his inimitably-styled petrofiddles, each laying the same motion on poor Ch J Michael B (“Iron Mike”) Thornton, with motions from IRS blowing off each one. Ch J Iron Mike fouls these back on the screen, telling each petrofiddler to answer IRS, and vice versa, with everything due on Friday, August 22.

Wanna bet ten new pence Ch J Iron Mike isn’t going to be standing at the front door of 400 Second Street, NW, at 5 p.m., in two weeks, eagerly awaiting delivery of the foregoing? Thought not.

But before I get to Obliging Judge Gustafson, let’s look at with what John J. Petito, wholesale tax matterer, has gifted Ch J Iron Mike. It’s a “Motion For Court Order To State That Petitioners Win, As Per Stare Decisis, With Prejudice.”

Haven’t seen the papers, so can’t tell what John J. is up to, but if you remember, John J. reached base on a single in Jimastowlo Oil, LLC, et al., John J. Petito, Tax Matters Partner, 2013 T. C. Memo. 195, filed 8/26/13, when IRS lost the source partner in the sun. See my blogpost “Honor Your Partner”, 8/26/13.

Howbeit, John J. is as cutesy as ever (see my blogpost “Save the Cutesy”, 7/1/14) with such entities as Tochlim Kepabroil Conglomerate LLC , Redwaterpet Oil & Gas Royal Oil Family Delectation, LLC, and Strikeoil, LLC, to name but a few.

Can’t wait for the opinions, all thirty of them.

Now for that Judge Gustafson designated hitter. It’s that up-and-coming bug rounder Janice Marie Cross, Docket No. 1439-13, filed 8/8/14. It’s what we call around the track “POE” (part of entry) as there are two cases, consolidated.

I call Janice Marie a “bug”, not as a derogatory term, but because around the track an apprentice jockey is known as a “bug”, colloquial for the asterisk that appears next his or her name in racing programs and formbooks to designate apprentice status. But Janice Marie is really moving up in class on the rounder circuit.

Janice Marie sends Judge Gustafson a nine-page billet doux (“Open letter”) with a tale of woe about how she can’t pay IRS, and, separately, a “”Petition for Default Judgment and Dismissal***.” Order, at p. 1.

Judge Gustafson, ever obliging, gives Janice Marie the short course in Tax Court law and practice.

“Ms. Cross’s letter will be returned unfiled, since it is not a proper submission. Requests for relief are to be presented by a motion, not by letter. (And Ms. Cross is advised that a motion should not be titled ‘Petition’. In this Court, a ‘petition’ is the document that commences a lawsuit. A subsequent request for relief is put in a ‘motion’.) The letter reflects one of Ms. Cross’s misunderstandings about this suit: Contrary to her apparent impressions, in these cases brought under section 6213(a), the Court will make no decision about the IRS’s collection of her tax liability but will instead determine the amount of that liability. In the current lawsuit, her financial circumstance is therefore irrelevant. After these cases are decided, if Ms. Cross has unpaid liabilities, then the IRS may commence collection by levy (such as garnishment) or by filing a notice of lien, and Ms. Cross may then be able to invoke this Court’s jurisdiction under section 6330(d) to review proposed collection of tax, in which context financial hardship may sometimes be relevant.” Order, at p. 1.

And the “motion to dismiss” would torpedo Janice Marie. She claims there’s some species of “default”, but Judge Gustafson says there’s been a SNOD, timely petition and answer, so there’s jurisdiction. Therefore, Section 7459(d) instructs us that dismissing a Section 6213(a) petition where there’s jurisdiction mandates a decision giving IRS everything they want. “Consequently, if we were to dismiss the cases–even at petitioner’s request–the decisions we enter would by law constitute an adjudication that she owes the deficiencies that the IRS determined.” Order, at p. 2.

So Judge Gustafson obliges Janice Marie and doesn’t dismiss this case.

Now we’ve got that out of the way, be warned, Janice Marie: “Ms. Cross shall take care to put the correct docket number(s) on all her filings. She has frequently transposed numbers and thereby misstated the docket number in case No. 1439-13. Ms. Cross shall also refrain from making further repetitive, frivolous filings. The time she spent composing and typing her ‘Open letter’ and ‘Petition for Default Judgment and Dismissal * **’ was time utterly wasted. These and her similar previous filings flatly contradict her complaints that she lacks adequate time to prepare for trial. If Ms. Cross hereafter files meritless motions, the Court expects to deny them summarily without explanation.” Order, at p. 3. (Emphasis in original).

Bless the rounders, every one. They’re the ones that keep blogging interesting.