I echo the greeting of the old Montréal Forum (now Bell Centre) to the new online petition generator, with its multifarious warnings to self-represented petitioners to redact all PII (Personally Identifiable Information) from submissions utilizing the same. The new facility will surely obviate the need for orders such as Crystal Elbert, Docket No. 12346-24, filed 8/2/24.

Crystal filed her pro se petition just last week, but already found she’d foot-faulted.

Ch J Kathleen (“TBS = The Big Shillelagh”) Kerrigan tells the story.

“…petitioner electronically filed the Petition to commence the above-docketed case, not accompanied by payment of the filing fee. On the same date, petitioner filed an Attachment to Petition. Petitioner’s filings were not properly redacted to eliminate references to taxpayer identifying information.” Order, at p. 1.

C h J TBS jumped on Crystal’s miscue the next day, ordering her to pay the Three Andys and file a properly-redacted petition. Simultaneously, Crystal “…filed a document … under the title ‘Motion to Close Case due to Lack of Redaction.’ Therein petitioner wrote, ‘I am writing this to create a motion to request case 12346-24 be redacted and closed due to petition social security number not redacted. Also missing important documentation.'” Order, at p. 1.

OK, Crystal, Ch J TBS will turn from her many important tasks and employ scarce judicial resources to help you out. And throw in some useful advice at no extra charge.

“We will seal petitioner’s improperly redacted documents. However, to the extent petitioner may be seeking to seal this entire proceeding, we inform her that, as a general rule, the official records of all courts are to be open and available for public inspection. See Willie Nelson Music Co. v. Commissioner, 85 T.C. 914, 917 (1985).” Order, at p. 1.

Hopefully, the new robopetitioner will make extinct “Motions to Close Case due to Lack of Redaction.”

J. E. Ryckman, 163 T. C. 3, filed 8/1/24, owes the Canadian Revenue Authority $200K in tax, whether USD or CAD not stated. So CRA filed an MCAR (Mutual Collection Assistance Request), per the 1995 consolidated tax treaty, with the US competent authority, who bucked it over to IRS. IRS hit J. E. with a NFTL. J. E. wants a CDP, but IRS says, no, the treaty says if Canada certifies that all remedies exhausted, game over.

But is it?

Judge Elizabeth A. (“Tex”) Copeland says yes. The treaty says all remedies exhausted, so no CDP. No conflict between the 1998 IRS Reorganization Act, which gave us the CDP régime three (count ’em, three) years after the final touches to the tax treaty with our Neighbour to the North, and said treaty.

We all know that treaties are equal to statutes, and are to be construed broadly to give effect to the intentions of the contracting parties.

So with a dictionary chaw or two, and a bunch full-page footnotes (hi, Judge Holmes), Judge Tex Copeland says Tax Court has no jurisdiction, no CDP or NOD necessary, and IRS can go collect. Ch J Kerrigan, and Judges Foley, Nega, Jones, Greaves, and Marshall agree. Judge Jones concurs strongly. The dissent would create rights not contemplated by the treaty. Judges Foley, Nega and Copeland agree.

But it’s a cliffhanger, as six (count ’em, six) judges dissent, namely, viz., and to wit Judges Urda, Toro, Pugh, Buch, Ashford and Weiler. They find “irreconcilable conflict” between the 1995 treaty and the 1998 statute, therefore the statute , later in time, rules.

Taishoff says the dissent makes hash of the intent of the parties, giving the foreign nonpayer a double dip. If a Canadian claim is to be collected with a mandated short stop at a US CDP, what’s to stop Appeals from reducing the claim via a PPIA, or giving petitioner CNC status, on either of which Tax Court signs off, notwithstanding that the petitioner had a shot at those remedies in Canada and lost?

IRS is still flogging the dead cliché in Albero Holdings, LLC, Albero Investors, LLC, Tax Matters Partner, Docket No. 16284-21, filed 8/1/24. This is the second case I’ve blogged wherein IRS sought to bootstrap a Section 6662A reportable chop onto Notice 2017-10; see my blogpost “How Green Is Still Green Valley,” 2/8/23. And lost, both times.

Both USTC and the Elevenses say IRS didn’t follow the Administrative Procedures Act, hence Notice 2017-10 is procedurally invalid. So why this second futility, which the Alberos’ trusty attorneys blow off with partial summary J?

Judge Elizabeth Crewson Paris tells us.

“Respondent objects to petitioner’s Motion for Partial Summary Judgment and maintains that Notice 2017-10 is valid to preserve its argument for purposes of appeal.” Order, at p. 3.

Appeal where? Albero is a GA LLC; place of trial is Atlanta, GA. IRS is Golsenized to 11 Cir, where IRS lost on this very point just two (count ’em, two) months ago. See Green Rock, LLC, No. 23-11041, filed 6/4/24, and no, I didn’t blog it because it came up via USDCNDAL.

Taishoff asks, when do we get a Section 6673 against IRS? Or maybe a Section 7430 legals motion? Why should the Alberos pay the freight for this Sisyphean excursion? And why should we taxpayers foot IRS’ bill for wasting “scarce judicial resources”?

I’ve often said that any lawyer who can’t find an ambiguity should find another way to make a living. Judge Travis A. (“Tag”) Greaves provides even more proof, if any were required, that he is abundantly qualified as a lawyer, in Amgen Inc. & Subsidiaries, Docket No. 16017-21, filed 7/31/24. The issue is whether various offshore subsidiaries generated income for parent when they reimbursed parent for Healthcare Reform Fees (HCRs), another offspring of the much-contemned Patient Protection and Affordable Care Act of 2010. HCRs are fees paid by manufacturers and sellers of certain prescription drugs. No doubt Amgen Inc. is one such.

Amgen’s trusty attorneys, all 24 (count ’em, 24) of them, want summary J that reimbursement is not income. But Judge Tag Greaves finds them a wee bit light on specifics. Paying another’s debt is income to the other when the other is relieved of the obligation to pay. But the payor does not receive income when it is reimbursed for the payment of the other’s debt. However, when one pays a deductible expense and receives (or has the right to receive, even if conditional) reimbursement, one has no deduction.

Mere legal liability is insufficient to establish who is responsible for the debt and who can deduct payment thereof. Judge Tag Greaves says this is often Tax Court’s job, but Amgen hasn’t given him enough information. It’s all ambiguous.

“Petitioner failed to show as a matter of law that the HCR Fees are expenses of the reimbursing parties. Petitioner asserts that the HCR Fees are ‘indelibly tied to the revenue’ that [subs] received. Other than this conclusory statement, petitioner failed to set forth any specific information related to the income [subs] generated in relation to the licensed drugs or how the reimbursement amount was calculated. Petitioner also failed to provide what effect, if any, the sale of the licensed drugs to Amgen USA had on the ability to connect [sub]’s income to the branded drug sales. The same factual footfalls [sic] prevent our ruling related to the allocation between Amgen Inc. and Pfizer. Petitioner fails to offer specific evidentiary support tying Pfizer’s income to the HCR Fees. In fact, petitioner fails to set forth any drug sales resulting from the joint venture. Therefore, we are unable to determine as a matter of law whether at least a portion of the HCR Fees properly belonged to Pfizer.

“The same uncertainty exists regarding Amgen Inc.’s right to reimbursement. First, we reject petitioner’s argument that the HCR Fees statutory scheme required the parties to reimburse Amgen Inc. The statute does not require repayment from a subsidiary or unrelated party. Rather, the statute only specifies that the designated entity, in this case Amgen Inc., is responsible for paying the government.

“Petitioner has further failed to show that any of the commercial exploitation agreements established a right to reimbursement.” Order, at p. 9. (I think you meant “footfaults,” Judge, not “footfalls.”).

While there was perhaps an oral agreement that was memorialized ten (count ’em, ten) years after it was made, various written agreements covering HCR activities made during that time all contained the usual boilerplate merger and integration clauses (“entire agreement of parties and supersedes all prior understandings”), and none of them mentions reimbursement.

No summary J on income, and no summary J on chops.

Although the rollout of the “new online petition generator, a tool to help pro se petitioners and others file petitions with the Court” allegedly occurred at 0800 Eastern this morning, no mention thereof can be found on the Tax Court website. I suppose the pro se has to register with DAWSON before being admitted to the robosphere.

Who the “others” might be in the above set forth statement is likewise nowhere stated, as yesterday’s webinar stressed that the new jim-handy generator is for the self-represented only. Practitioners are relegated to their own preparation. Like Dorothy Parker’s fat hen, “You cannot persuade her with gun or lariat to come across for the proletariat.”

Natheless, I expect great things from the robopetitioner. It finally got rid of the endless orders directing redaction of SSANs and TINs from kit-prepared petitions. The new system supposedly routes that information straight to IRS, never reaching Tax Court’s files. Of course, redacting everything else still falls to the petitioner.

And regrettably, the invaluable introductory webinar aired yesterday, July 30, has joined darling Clementine and the snows of yesteryear, gone forever.

It’s an old cliché that the law loves to talk. I spent a couple minutes (hi, Judge Holmes) the other day talking to a colleague out West about a cool tactical move he pulled, and we both gave Judge Elizabeth A. (“Tex”) Copeland a kind mention. Win or lose, you get a fair shake.

While perhaps the trusty attorneys for Point72 Asset Management, L.P., Point72 Capital Advisors, Inc., Tax Matters Partner, Docket No. 12752-23, filed 7/30/24, might grumble at the foregoing, voicing a couple objurgations and colorful metaphors, I’m sure they’ll calm down.

Because they got a fair shake.

Trying to get IRS’ understanding of abstract principles of law in discovery is a no-no. Maybe they might have done better had they been a wee bit subtle, but check out Order at p. 3, discussion of Interrogatory 2.  And IRS can produce business records in lieu of responses, per Rule 71(e).

But IRS should know by now that when they want to exclude documents or testimony based on privilege, they’d best brandish a privilege log, with chapter and verse.

Point72’s trusty attorneys can always try again as they keep on with discovery.

No, not the pop singing duo from the Beach Boys days; this is Christopher Holly (the “DAWSON Product Owner”) and Tenille Lenard (the “DAWSON Product Specialist”), live from The Glasshouse in the City Taxed but Unrepresented, debuting the all-new, user-friendly, jim-handy online petition generator. Apparently Chris is the man who gave us DAWSON, hence he is the “Owner.”

The robopetitioner is for the self-represented only; no practitioners need apply, although Judge Ronald L. (“Ingenuity”) Buch noted the extensive attendance of the LITC crowd. Glad they could make it, as this presentation was not recorded and won’t be repeated. I wonder how many of the 80% of Tax Court petitioners who are self-represented, and for whose benefit this platform was devised, were available at Noon Eastern Time on a Tuesday.

Judge Ingenuity Buch assures us that the generator uses no AI, but is run by and for the petitioner on his/her own device (laptop, desktop, tablet, or smartphone). So the answer to my blogpost “AI Comes to Second Street, NW?” 6/28/24, is definitely no.

It’s a simple online form-fill, takes only PDF attachments, full of warnings to redact PII, easy to return to previous pages to correct. No discussion of “Save” function, but I suppose it’s easy enough to save one’s submission, or print it from the docket page once it’s filed. I challenged the insufficiency of the product’s warning to doublecheck filing deadlines, but Tax Court eschews the complexities thereof, leaving the selfies to seek salvation in fear and trembling.

Would this product have saved Antawn Jamal Sanders? See my blogpost “In the Midnight Hour,” 6/20/23.

OK, so the product is definitely a good thing.

Now for Taishoff’s gripes.

Why was this webinar not recorded? Was it so far beyond Tax Court’s capabilities? The DEI series was recorded and is available on the Tax Court website. While that series is all very commendable, would not the hapless, feckless pro se, who, Judge Ingenuity Buch tells us, represents no less than eighty (count ’em, eighty) percent of all petitioners, be served at least equally well if s/he could watch this demonstration before venturing onto the platform?

As for the Captain, were I the one who perpetrated the rollout of DAWSON (see my blogpost “Up DAWSON’s Creek,” 10/12/21), I don’t know I’d exert any immoderate haste to claim parentage.

A source tells me that the United States Senate has approved a new Tax Court Judge.  It looks like STJ Adam B. (“Sport”) Landy has gotten the nod, and is the first STJ to move to the Big Bench since I started this blog twelve (count ’em, twelve) years ago.

I wonder, readers: should I change “Sport” to “Mustang”? That was the old US Navy term for an officer who started out as an enlisted personnel. I’ll take a vote.

Edited to add, 7/29/24: Of course, on Friday last, Judge Kashi Way, an 18-year veteran counsel to the Joint Committee on Taxation, got the Senatorial nod. Four (count ’em, four) more picks on the pattern. More judges, fewer delays, more blogfodder…what could be bad?

I’ve pointed out before now that the evidentiary confines of Section 6015(e)(7), namely the administrative record and any “newly-discovered or previously unavailable evidence” make a mockery of the supposed de novo review of innocent spousery. But the trusty attorneys for Laura B. Schnackel, co-star of Gregory R. Schnackel and Laura B. Schnackel, T. C. 2024-76, filed 7/29/24, whom I’ll call Ed and How, earn a Taishoff “Good Job,” for slipping the surly bonds of the Taxpayer First Act.

Ed and How first raise innocent spousery in a pretrial motion for leave to file separate amended petition, after Laura and Greg petitioned the deficiencies for the three (count ’em, three) years at issue.

Ch J Kathleen (“TBS = The Big Shillelagh”) Kerrigan notes the amended petition did not specify Section 6015(f), and Greg objected, but allows the amendment as an affirmative defense. IRS does concede innocent spousery, but Ch J TBS goes through the factors anyway, as Greg’s objection continues.

Note that here there is no administrative record, hence no Taxpayer First handcuffs.

“Section 6015(e)(7) prescribes the scope of review the Tax Court shall employ in cases such as this one. Paragraph (7) was added to section 6015 by Taxpayer First Act § 1203, 133 Stat. at 988, and applies to petitions for review of determinations made under section 6015 filed on or after July 1, 2019, and requests pending with the Internal Revenue Service on or after July 1, 2019. Section 6015(e)(7) does not apply because respondent did not issue a notice of determination.” T. C. 2024-76, at p 15, footnote 7. (Citation omitted).

Laura gets innocent spousery. She was educated as a nutritionist, only signed checks while at Greg’s engineering outfit, and didn’t get any extra benefits from Greg’s chicanery.

“Petitioner husband was deceitful in his relationship with his wife. He hid his affair and opened a secret credit card to hide spending associated with it. He funded the affair by diverting marital assets unbeknownst to petitioner wife. Considering all the facts and circumstances, petitioner wife did not have reason to know of the understatements.” T. C. Memo. 2024-76, at p. 17.

There’s a multi-million-dollar NYC condo (Kips Bay, with terrace), and a Range Rover, and the NE divorce court found Greg spent about $3 million on the affair.

Other than that, the case is mostly an indocumentado, Section 274 variation.

But add Ed’s and Howe’s tactical amendment to your toolbox, if you need a real trial for innocent spousery.

Whenever that is the question in anything but a Section 7623 whistleblower case, the answer is always the same; another question: what are the specific justifications? Generalities don’t o’ercrow Section 7461 and the public’s right to know. Show specific, demonstrable injuries to person or purse, or Tax Court will let it all hang out.

And same will be fair game for the trade press and the blogosphere.

Wherefore Judge Travis A.(“Tag”) Greaves adjures Amgen Inc. & Subsidiaries, Docket No. 16017-21, filed 7/26/24, as to both of their motions (the one to unseal pleadings in the HCR credit case and one to unseal the pleadings in their “Due Process” one), to supplement each with “a list of requested redactions with corresponding justifications.” Order, at p. 2.

Amgen wanted only parts of the respective pleadings redacted. But in support of their requests, “P)etitioner improperly filed versions of these pleadings with unagreed redactions. These documents will be stricken, and the Court will order petitioner to file properly redacted documents after ruling on these motions.” Order, at p. 1.

So, after tossing twelve (count ’em, twelve) documents, presumably prepared, reviewed, and submitted by one or more of the seven (count ’em, seven) attorneys from IRS, and twenty-four (count ’em, twenty-four) attorneys for Amgen, Judge Tag Greaves thus catechizes the platoon.

“There is a strong presumption of public access to court records. Foltz v. State Farm Mut. Auto. Ins. Co., 331 F.3d 1122, 1135 (9th Cir. 2003). A party seeking to seal judicial records, including exhibits attached to dispositive motions, bears the burden of overcoming this strong presumption by showing a compelling reason for sealing such records. Id. at 1136. Petitioner has failed to set forth a specific list of the requested redactions and the justification for each redaction.” Order, at p. 1.

Those seeking sealing in their non-blower cases should read and heed, and not complain, if they can’t meet the Foltz standard. Specificity rules.