Yet another cautionary tale for the tax criminal defense bar today, from Judge Lauber, the Old Cantabrigian classicist. It’s Del-Co Western, a Utah Corporation, 2015 T. C. Memo. 142, filed 8/5/15.

JaNean Del’Andrae, CFO of Del-Co, copped to 7201 nastiness for Del-Co and for herself and spouse.

“In connection with her plea, Del’Andrae agreed to pay restitution of $88,152.50 to the Internal Revenue Service (IRS) on account of Del-Co’s 2004 and 2005 tax liabilities. Of this sum she agreed that $49,845.37 was payable on account of Del-Co’s 2004 tax liability and that $38,307.13 was payable on account of Del-Co’s 2005 tax liability. She also agreed to pay additional restitution, to be determined at sentencing, on account of her 2005 joint income tax liability.” 2015 T. C. Memo. 142, at pp. 2-3.

JaNean coughed up $136,509.50. Of this, $88,152.50 was for Del-Co for 2004 and 2005, and $48,357.00 was for JaNean and spouse (who apparently shall be nameless, as spouse’s name never appears in the memo).

Then Del-Co and IRS stipulated to a decision. Del-Co claimed IRS never properly credited the $136,950.50 payment. When IRS hit Del-Co with a NITL, Del-Co asked for a CDP, but couldn’t prove the payment. IRS did concede that portion of the payment allocable to 2004 for Del-Co, which was all Del-Co petitioned. So IRS claimed no further controversy, and moved to toss Del-Co.

Clear? Thought not.

Del-Co argues that the 2005 portion of the payment JaNean made should also be credited to 2004, because the SOL has run for 2005, even though Section 6501(c) allows IRS to assess tax “at any time” when fraud is involved. But Del-Co claims it isn’t responsible for JaNean’s fraud.

Judge Lauber says that’s a controversy, so he’ll decide. And treat this as summary J, because there are no questions of fact.

“In appropriate circumstances, we may determine in a CDP case whether a credit available from another tax year should be applied to the taxpayer’s liability for the year before the Court (here, 2004). But we can do this only when a credit from another tax year indisputably exists; we do not have jurisdiction under section 6330 to ‘determine an overpayment of an unrelated liability.’ Weber v. Commissioner, 138 T.C. 348, 366 (2012).” 2015 T. C. Memo. 142, at pp. 6-7.

You remember the Weber case, right? Wrong? Then you didn’t read my blogpost “Can’t Fight the Penalty,” 5/7/12.

“Neither the IRS nor any court has determined that Del-Co overpaid its tax for 2005. Indeed, the propositions upon which petitioner relies for its contention that the statute of limitations bars assessment of additional tax against it for 2005 seem highly debatable. In any event, Del-Co does not now have an ‘available credit’ for 2005 that can be taken into account in determining the extent to which its tax liability for 2004 remains unpaid.” 2015 T. C. Memo. 142, at p. 7. (Footnote omitted, but it says that the magic Section 6201(c) “at any time” might apply if Tax Court had jurisdiction to redetermine the 2005 tax liability, which it doesn’t).

So Del-Co has a claim for a credit, but not an available credit. And there’s no obligation for IRS to sort out Del-Co’s claim before levying. And interest abatement isn’t before the Court, because Del-Co didn’t raise that at the CDP.

So IRS can levy.

Takeaway—Defense counsel, when you settle, make sure that IRS is in the loop and acknowledges what each component of the forkover from your client covers. It beats getting a Taishoff “good try, second class,” which I hereby award Del-Co’s attorneys.

Plenty, if It Looks Like It Has Authority

This is about tax mutterers, not roses, but the punchline is the same. The name is material if people could think that the name carries authority.

And Judge Goeke thinks Eric Gjelde, man of many roles, has all the authority needed to extend the SOL in Summit Vineyard Holdings, LLC, Summit SV Holdings, LLC, Tax Matters Partner, 2015 T. C. Memo. 140, filed 8/4/15.

Eric was managing member of Summit, tax matterer in the year at issue, and managing member of Meridian, tax matterer when the Form 872-P was filed extending the TEFRA FPAA SOL.

Meridian replaced Summit between year at issue and year when SOL was extended. Eric signed the Form 872-P as managing member of Meridian, although for the year in question Summit was the tax matterer.

Vineyard now claims SOL has run, as wrong party signed the Form 872-P. But SOL against the government is strictly construed in favor of the government.

Judge Goeke starts with Sec. 301.6231(a)(7)-1(a), Proced. & Admin. Regs. Change of tax matterer can only take place as therein specified, and the incumbent remains until the appropriate event occurs.

So Vineyard argues that Meridian, even though tax matterer-designate, had no authority to act for Vineyard because only Summit could do so for the year at issue, even though Eric only signed the Form 872-P in the name of Meridian because his secretary typed in Meridian’s name.

IRS argues “apparent authority,” and that carries the day. Vineyard is headquartered in Washington State, and a canvass of that State’s law says if one could reasonably believe an individual had authority to bind an entity, the individual binds the entity.

Eric was managing member of both Summit and Meridian. Eric signed a POA to his CPA, who in turn dealt with IRS. The CPA sent the Form 872-P to Eric to sign, and he did. IRS was justified in believing Eric had authority to sign the Form 872-P.

Takeaway—If you look like the boss and act like the boss, you are the boss.

No one denies that Henry J. Haff and Diane M. Lis Haff wuz robbed. The only question Judge Pugh has to answer is “how much”? And the answer, “Not as much as you claimed,” is found in 2015 T. C. Memo. 138, filed 8/3/15.

Henry J. got involved in a real estate deal that turned out to be another descendant of the 1920 pyramid scheme of the late Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi.

Henry J. and Diane M. Lis claimed the benefit of Rev. Proc. 2009-20, 2009-14 I.R.B. 749, to deduct services Henry J. rendered to the Ponzists, over and above the actual cash he handed over. IRS allowed Henry J. and Diane M. Lis theft loss treatment for all the cash, but denied the $730K in services Henry J. claimed, because he never reported any of these services as income, and thus had no basis in the phony partnership above the actual cash he put in.

Judge Pugh sorts it out: “Petitioners do not argue that the additional $730,786 should be deductible under the plain text of section 165. Rather, petitioners assert that Rev. Proc. 2009-20, supra, allows a loss deduction for amounts not previously included in income under a safe harbor and that the safe harbor applies to the amounts that [the phony] owed them. Even if the revenue procedure applies, it would not permit petitioners to deduct the additional $730,786 on their 2009 tax return. The safe harbor provision of Rev. Proc. 2009-20, supra, permits deductions only to the extent of a ‘qualified investment’. A qualified investment is defined as the taxpayer’s total amount of cash, or the basis of property, invested plus ‘[t]he total amount of net income with respect to the specified fraudulent arrangement that, consistent with information received from the specified fraudulent arrangement, the qualified investor included in income for federal tax purposes for all taxable years prior to the discovery year, including taxable years for which a refund is barred by the statute of limitations’, minus the total cash or property that the taxpayer withdrew in all years. Rev. Proc. 2009-20, sec. 4.06(1)(a) and (b), 2009-14 I.R.B. at 750 (emphasis added).

“Petitioners did not include the $730,786, or any portion thereof, as income for prior years. To constitute basis, for purposes of section 165 or Rev. Proc. 2009-20, supra, the amounts owed must have been included in income for tax purposes previously.” 2015 T. C. Memo. 138, at pp. 6-7.

The bad guys stiffed Henry J. for fees he said were owing him for development, sales, marketing and construction.

Welcome to the International Confraternity of the Stiffed, Brother Henry J. I know the feeling well.

Remember Bruce M. Kraft and his trust funds? I’m not surprised. See my blogpost “No Invasion,” 4/23/14.

Dale A. Wallace also wants IRS to hit his 401(k) and savings before grabbing his real estate, but STJ Lewis (“Great Name”) Carluzzo says no, in Docket No. 4899-14L, filed 7/31/15.

Dale isn’t fighting the liability, only the NOD from his CDP.

“According to the petition, petitioner requests that respondent [IRS] levy on his savings and 401K[sic] instead of petitioner’s real property. Petitioner contends his deceased wife owned the property, and he transferred it to her family. The record reflects that petitioner transferred the property to his deceased wife’s family…nine days after respondent imposed a lien on the property.” Order, at p. 2.

Dale wanted an installment agreement, but Appeals said no, unless Dale unloaded some investment accounts and real estate to pay down some of what he owes.

Dale said no.

Game over for Dale. “…we note that it is not an abuse of discretion when respondent’s Appeals Office rejects an installment agreement because a taxpayer refuses to liquidate assets to satisfy his tax liabilities. We see no reason to depart from that principle in this case.” Order, at p. 2.

Summary J for IRS.

Takeaway—The IRS’s lien for unpaid taxes attaches to everything. IRS can levy on anything not limited by Section 6334.

This was a favorite delaying tactic a couple years (hi, Judge Holmes) ago, but it seemed to lose favor. However, today Judge Lauber has a player before him, and the gambit is declined, forcefully.

Here’s how the gambit is played. I’ll cite the dates, because they are important.

“Five years ago, we determined a deficiency and an addition to tax for petitioner’s 2003 taxable year. Petitioner appealed that decision to the Court of Appeals for the Ninth Circuit, which affirmed. Petitioner then filed several motions in the U.S. Supreme Court seeking permission to file a petition for writ of certiorari out of time; each motion was denied. Undeterred, petitioner attempted to file numerous other documents with the Supreme Court, which led the Court to bar him from making additional filings. Indeed, in his motion for reconsideration of our opinion, which we denied on July 14, 2015, petitioner persists in arguing that the Supreme Court erred in determining that his petitions for certiorari were untimely.” Sivatharan Natkunanathan, Docket No. 10332-14L, filed 7/20/15, at p. 2. (Citations omitted.)

Siv is up on a NOD from a CDP. He’s also a candidate for rounderhood, and his prospects along that line look very good. Siv might even be a runner in the Section 6673 sweepstakes.

Now Siv may try to appeal denial of the reconsideration from the CDP NOD. But IRS has a gambit worth two of those.

“…respondent filed a Motion to Permit Levy. The effect of granting this Motion would be to allow the IRS to levy immediately in an effort to collect petitioner’s 2003 tax liability, without waiting for the expiration of the time for petitioner to appeal this Court’s decision and seek certiorari. We ordered petitioner to respond to the IRS motion by July 29, 2015. Petitioner has filed no response.

“A taxpayer’s request for a CDP hearing automatically suspends the levy process ‘for the period during which such hearing, and appeals therein, are pending.’ Sec. 6330(e)(1). However, section 6330(e)(2) provides that this suspension ‘shall not apply to a levy action while an appeal is pending if the underlying tax liability is not at issue in the appeal and the court determines that the Secretary has shown good cause not to suspend the levy.’” Order, at p. 1.

Well, Siv hasn’t contested liability. And good cause?

“The IRS seeks to use its levy power to collect a tax liability that petitioner incurred 12 years ago. In light of petitioner’s litigiousness and the frivolous nature of many of his filings, the IRS should not be forced to wait until he has pursued what may be many more months of fruitless litigation. Petitioner has ‘used the collection review procedure to espouse frivolous and groundless arguments and otherwise needlessly delay collection.’” Order, at p. 2 (Citation omitted).

Checkmate, Siv.

No, not “when can I get this (colorful metaphors and expletives deleted) thing off my back?” Rather, these are plastic clamshells, cardboard trays and cartons, wherein are packed the raspberries, strawberries and similar growths that feed our vegetative dependencies.

The packer is Agro-Jal Farming Enterprises, Inc., et al., 145 T. C. 5, filed 7/30/15. The question is when can Agro-Jal deduct these fieldpacking materials, when bought or when actually used, Agro-Jal accounting for this stuff on the cash basis. Agro-Jal says when paid for, IRS says when used.

And who shall field, or unpack, this conundrum?

Why, whom else but The Great Dissenter, a/k/a The Judge Who Writes Like a Human Being, a/k/a The Implacable, Illustrious, Imperturbable, Indefatigable, Incomparable and Irreplaceable Foe of the Partitive Genitive, and Old China Hand, Judge Mark V. Holmes?

Agro-Jal is “…in many ways the Maldonaldo family farm, whose patriarch founded it many years ago. The business has grown greatly over the years, and most of its income now comes from the efficient production of a few crops–strawberries, broccoli, cauliflower, iceberg and romaine lettuce, and celery. It is a year-round business but somewhat unpredictable because of the farmer’s oldest adversary, the weather, as well as fluctuations in market demand.” 145 T. C. 5, at p. 3.

But it’s much more than Grapes of Wrath technology. The pickers grade and pack carefully in the fields themselves, making sure the goodies are market-worthy and wind up on the dinner table or lunchbox in shape worthy of the Maldonado heritage. Judge Holmes expatiates extensively on the process, and if you want to know how what’s on the shelf at West Side Market et hoc genus omne got there, Judge Holmes is the man to tell you.

Labeling is a big deal; it’s not just what’s in the pack, it’s what the label says and must say. So timing deliveries of pack and labels is quite a ballet. No, I won’t start a diatribe on genetically-modified organisms, nor does Judge Holmes.

Agro-Jal is a cash-basis taxpayer but an accrual-method bookkeeper, because its lenders want GAAP certified statements, so there’s inventory for each year at issue.

IRS says Agro-Jal can only expense what it uses in any tax year. Anything left over must go to the next year.

You can see this is a big deal for any farmer bigger than a roadside stand operator.

Farmers get a lot of tax breaks. They can use cash-method even though other C Corps can’t. Payment must be a payment to be deductible, not a deposit, and there’s a two-year limit to get around capitalization rules.

But since sheltermongers were playing games with leveraged advance purchases of supplies to throw off big deductions with no offsetting income, Section 464 prevents farming syndicates from taking deductions for “feed, seed, fertilizer, or other similar farm supplies” in any year earlier than when consumed.

“Both parties agree that this section does not directly apply to Agro-Jal, but both also argue that the section helps us figure out the meaning of the regulation that does.” 145 T. C. 5, at p. 10. (Footnote omitted, but it tells us what a farming syndicate is, and Agro-Jal isn’t.)

Also in the mix is old Reg. 1.162-3: “Taxpayers carrying materials and supplies on hand should include in expenses the charges for materials and supplies only in the amount that they are actually consumed and used in operation during the taxable year for which the return is made, provided that the costs of such materials and supplies have not been deducted in determining the net income or loss or taxable income for any previous year.” 154 T. C. 5, at p. 11. (Emphasis by the Court.)

Note old Reg. 1.162-3 quoted here was superseded.

“Both parties also analyze what caselaw there is on the subject. Nothing’s directly on point, but the Ninth Circuit, to which this case is appealable, see sec. 7482, has spoken a couple times about the timing of farmers’ deductions.” 145 T. C. 5, at pp. 11-12. And Judge Holmes has once again dissed the partitive genitive.

However, he is strong on ejusdem generis, which means “the same sort of stuff”. And while the packs are very important to Agro-Jal, they aren’t “feed, seed, or fertilizer,” which are things you need to grow the stuff, not to package or sell it.

But that’s not the end of the story. Section 464 is an anti-abuse provision, aimed at the sheltermongers’ syndicates.

And Judge Holmes, ever the grammarian and syntaxtician, goes extensively into the phrases “provided that” and “on hand”, to give Agro-Jal a win.

“Agro-Jal can deduct its field-packing materials for the year it bought them. The materials that it buys that are not ‘on hand’ are governed by the general rules of cash-method accounting, which allow current deduction. The materials that it buys that are ‘on hand’ are governed by section 1.162-3, which we hold does not require a cash-method taxpayer to defer its deductions until the materials are used or consumed, if the taxpayer deducted their costs for a prior tax year. The ‘one-year rule’–the rule that a taxpayer has to use those supplies within an approximately one-year period–might limit deductibility in some other case.

“But not here.” 145 T. C. 5, at pp. 26-27 (Footnote omitted.)

Is the key to deciding whether a proposed amendment to a pleading is an ambush.

On a slow day in Tax Court (no opinions, no really toothsome orders), STJ Lewis (“The Name”) Carluzzo has a designated hitter, Jeremy Edwin Porter & Ruth Ann Porter, Docket No. 16966-14, filed 7/29/15.

The Porters object to IRS’s amending its answer out of time, to allege Section 6663 fraud chops. That’s the 75% solution, and it can really sting.

IRS needs leave of court, of course, because more than thirty days have gone by since the last pleading.

But the liberals (not the political ones) have it.

“In general, after a responsive pleading has been served, or if after 30 days no responsive pleading is permitted, ‘a party may amend a pleading only by leave of Court or by written consent of the adverse party, and leave shall be given freely when justice so requires.’ Rule 41(a). That Rule reflects ‘a liberal attitude toward amendment of pleadings.’ 60 T.C. 1089 (explanatory note accompanying promulgation of Rule 41). Petitioners have not consented to the amendment.” Order, at p. 1.

Judge, I don’t know that I would consent, either.

But the case hasn’t been set for trial, and the Porters don’t show unfair surprise, disadvantage or prejudice. So it seems they have time to prepare a defense to IRS’s attempt to show the clear and convincing evidence necessary to sustain the fraud chops.

And that seems to be the test.

No, not the religious group. This blogpost is about the minimum five percent of net asset value of a NIMCRUT, calculated annually, required to be distributed each year in order to make sure the charitable remainderer gets at least 10% of NAV, calculated at inception.

Since the noncharitable income beneficiaries could get enough more (with a catch-up in any year when the assets didn’t yield the required distribution, thus making the Charitable Remainder Unitrusts, or CRUTs, into Net Income with Make-up Charitable Remainder Unitrusts, or NIMCRUTs) to torpedo the charitables at the end of the twenty-year income stream, no charitable deduction for the remainder claimed by Estate of Arthur E. Schaefer, Deceased, Kathleen J. Wells, Executor, 145 T. C. 4, filed 7/28/15.

Section 664 and the regs are not models of clarity, but Judge Buch finds the Senate memo shows what Congress intended, and gives it weight.

“A second modification of the annuity trust and unitrust rules made by the committee provides that the charitable remainder trust must be required by the trust instrument to distribute each year 5 percent of the net fair market value of its assets (valued annually in the case of a unitrust and valued at the time of the contribution in the case of an annuity trust) or the amount of the trust income, whichever is lower. In valuing the amount of a charitable contributions deduction in the case of a remainder interest given to charity in the form of an annuity trust or a unitrust, it is to be computed on the basis that the income beneficiary of the trust will receive each year the higher of 5 percent of the net fair market value of the trust assets or the payment provided for in the trust instrument. * * * S. Rept. No. 91-552, supra at 89-90, 1969-3 C.B. at 481 (emphasis added).” 145 T. C. 4, at .pp. 14-15.

IRS issued Rev. Ruls. and Rev. Procs following that lead, although the regs aren’t clear, and the Code is not much better. So IRS’s guidance gets Skidmore deference.

Clear? Thought not.

The Section 7206 plea-cop is a minefield. I blogged this once already; see my blogpost “A Cool Cat,” 4/16/13.

But Husam A. Abu-Dayeh 2015 T. C. Memo. 136, filed 7/28/15, and his attorney (whom I’ll not name, as he will probably suffer, or has already suffered, enough) obviously missed my blogpost, because Husam copped to one count of a Section 7206(2) rap for writing fiction on Forms 1040, but got hit with civil penalties thereafter.

The Federales hit Husam for a cool $79K in losses to the fisc by reason of Husam’s chicanery regarding some 36 (or maybe 39) spurious returns Husam’s taxprep business prepared and filed.

Comes now IRS and nails Husam for $39K in $1K increments, the civil preparer penalties.

Husam and lawyer yell they gave at the office. No says IRS, read your plea bargain. And if you don’t, Judge Nega will read it for you.

“The plea agreement specifically states that it is ‘limited to the Office of the United States Attorney for the Middle District of Florida and cannot bind other federal, state, or local prosecuting authorities’. The plea agreement is a total of 12 pages, all of which are initialed or signed by petitioner except for page 10. Page 10 contains an explicit statement of petitioner’s guilt in filing materially false tax returns: ‘[D]efendant is pleading guilty because defendant is in fact guilty.’” 2015 T. C. Memo. 136, at p. 3.

Husam tries to get a CDP on his own, but his OIC is defective (no first payment, no income certification and no fee). And the first AO he spoke to cut the penalties from $39K to $36K.

Judge Nega concludes: “While we understand petitioner’s frustration at having been assessed penalties after he paid restitution to the IRS, SO X followed the requirements of section 6330(c), and her decision to uphold the NFTL was not an abuse of discretion.” 2015 T. C. Memo. 136, at p. 10. (Name omitted).

Criminal defense lawyers, read those plea agreements. Make sure they cover Treasury and IRS civil and criminal penalties. Merely covering DOJ or the US Attorney is not enough, unless you’ve warned your client and have informed written consent to go ahead.

And tell ‘em Husam sent you.

Make a Lovely Sight?

No, not if you remember The Crests’ 1959 hit; that was about candles. Maybe, if you’re Altera Corporation and Subsidiaries, rejoicing in your win over Treas. Reg. 1.482-7(d)(2), in 145 T. C. 3, filed 7/27/15, with ten (count ‘em, ten) lawyers on your side and six (6) for IRS.

The kerfuffle is about whether SBCs have to be included in QCSAs. If you’re partial to offshore Base Erosion and Profit Shifting, this is your cup of Lapsang Souchong.

Altera made a license deal with its Cayman Islands (surprise, surprise) sub, giving the sub  “the right to use and exploit, everywhere except the United States and Canada, all of Altera U.S.’s intangible property relating to [programmable logic devices] and programming tools that existed before the R&D cost-sharing agreement (pre-cost-sharing intangible property). In exchange for the rights granted under the technology license agreement, Altera International paid royalties to Altera U.S. in each year from 1997 through 2003. As of December 31, 2003, Altera International owned a fully paid-up license to use the pre-cost-sharing intangible property in its territory.

“Under the R&D cost-sharing agreement, Altera U.S. and Altera International agreed to pool their respective resources to conduct research and development using the pre-cost-sharing intangible property. Under the R&D cost-sharing agreement, Altera U.S. and Altera International agreed to share the risks and costs of research and development activities they performed on or after May 23, 1997. The R&D cost-sharing agreement was in effect from May 23, 1997, through 2007.” 145 T. C. 3, at pp. 5-6.

Of course the Cayman Islands are chock-a-block with programmers and software developers. Roger that, as I said in an earlier incarnation.

Also of course, “In Xilinx Inc. v. Commissioner, 125 T.C. 37 (2005), aff’d, 598 F.3d 1191 (9th Cir. 2010), we held that, under the 1995 cost-sharing regulations, controlled entities entering into qualified cost-sharing agreements (QCSAs) need not share stock-based compensation (SBC) costs because parties operating at arm’s length would not do so. In 2003 Treasury issued sec. 1.482-7(d)(2), Income Tax Regs. (final rule). The final rule requires controlled parties entering into QCSAs to share SBC costs.” 145 T. C. 3, at p. 1.

And, per the reg, it doesn’t matter if there are no comparables, let it all hang out.

So we have a Chevron (or maybe State Farm, Motor Vehicle Mfrs. Ass’n of the U.S. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)) faceoff. Was Treasury arbitrary and capricious or in manifest disregard of the law by requiring stock-based compensation to be included in Qualified Cost-Sharing Agreements?

Judge Marvel says yes.

There are no arms’-length comparables for stock-based compensation in cost-sharing deals among unrelateds. Testimony during the comment period preceding the final reg featured all the white-shoe and big-four players, who uniformly agreed that stock-based compensation was too speculative to value at inception, was subject to variables beyond the control of the parties to the cost-sharing agreement, could be uncontrollably large, and besides, you could look at EDGAR and see nobody did it, and so an arms’-length comparable didn’t exist.

And courts can’t substitute their own judgment for the agency’s, and can’t go beyond what the agency said. All a court can do is consider the factors the agency articulated (sound like Chenery to you? It’s actually State Farm), and if any meets the test (and would have been followed even if the agency articulated defective reasons), the reg must be sustained.

And we all remember the Chevron two-part test. But mox nix.

“Because the validity of the final rule turns on whether Treasury reasonably concluded that it is consistent with the arm’s-length standard, the final rule must–in any event–satisfy State Farm’s reasoned decision-making standard. Accordingly, we will examine whether the final rule satisfies that standard without deciding whether Chevron or State Farm provides the ultimate standard of review.” 145 T. C. 3, at p. 48.

In any case, this is legislative regulating and has the force of law. And any Treasury booboos aren’t harmless error.

Judge Marvel nails Treasury and the reg thus: “Because the final rule lacks a basis in fact, Treasury failed to rationally connect the choice it made with the facts found, Treasury failed to respond to significant comments when it issued the final rule, and Treasury’s conclusion that the final rule is consistent with the arm’s-length standard is contrary to all of the evidence before it, we conclude that the final rule fails to satisfy State Farm’s reasoned decisionmaking standard and therefore is invalid.” 145 T. C. 3, at p. 69.

Bad day at 1111 Constitution Ave, NW.