Paul L. Caron
Dean




Monday, December 20, 2021

A Year Of Lessons From The Tax Court (2021)

Here is a chronological listing of all the Lessons From The Tax Court I posted in 2021, with links to, the Lesson, the primary case discussed and its author.  I have also listed the primary Code sections mentioned or discussed in the Lesson.  At the end of the chronological listing, you will find a table listing the posts by which Tax Court Judge authored the Court's opinion.

Camp (2021)January 11: Too Much Control Over IRA Distribution Makes It Income (Brett John Ball v. Commissioner, T.C. Memo. 2020-152 (Nov. 10, 2020) (Judge Halpern) — §72, §408, §451, §671, §4975)

January 19, 2021: The CDP Silver Linings Playbook (Wiley Ramey v. Commissioner, 156 T.C. No. 1 (Jan. 14, 2021) (Judge Toro) — §6320, §6330)

January 25, 2021: No Deduction for Disguised Dividends (Aspro, Inc. v. Commissioner, T.C. Memo. 2021-8 (Jan. 21, 2021) (Judge Pugh) — §162)

February 1: No Product? No §162 Deduction! (William Bruce Costello and Martiza Legarcie v. Commissioner, T.C. Memo. 2021-9 (Jan. 25, 2021) (Judge Halpern) — §162, §212)

February 8: When A Hotel Becomes A Tax Home (Akeem Adebayo Soboyede v. Commissioner, T.C. Summ. Op. 2021-3 (Jan. 26, 2021) (Judge Greaves) — §121, §162, §262, §911)

February 15: The §104(a)(2) Causality Rule (Timothy Stassi and Cindi Stassi v. Commissioner, T.C. Summ. Op. 2021-5 (Feb. 7, 2021) (Judge Kerrigan) — §104(a)(2))

February 22: The Fearsome Scope of Evil §208E (San Jose Wellness v. Commissioner, 156 T.C. No. 4 (Feb. 17, 2021) (Judge Toro) — §132, §162, §163 & §164, §165, §167, §170, §261, §280E)

March 1: No Second Bite In CDP For Rejected OIC (Craig L. Galloway v. Commissioner, T.C. Memo. 2021-24 (Feb. 24, 2021) (Judge Urda) — §6015, §6320, §6330, §6331)

March 8: New ‘Consequential Moment’ Rule for §6751 Supervisory Approval (Brian D. Beland and Denae A. Beland v. Commissioner, 156 T.C. No. 5 (Mar. 1, 2021) (Judge Greaves) —  §6501, §6751, §7604)

March 15: The Presumption Of Regularity For NODs (Brian E. Harriss v. Commissioner, T.C. Memo. 2021-31 (Mar. 11, 2021) (Judge Thornton) — §273, §274, §6212, §6673)

March 22: S Corp Payments to Sole Shareholder Were Wages (Lateesa Ward and Ward & Ward Company v. Commissioner, T.C. Memo. 2021-32 (Mar. 15, 2021) (Judge Holmes) — §1366, §1367, §1368, §3101, §1401, §3111(a), §3301, §3102, §3121, §3212, §3306, §7501)

March 29: Failing Business No Reason To Stop Collection In CDP Hearing (American Limousines, Inc. v. Commissioner, T.C. Memo. 2121-36 (Mar. 25, 2021) (Judge Halpern) — §3101, §3111, §3301, §6320, §6330, §6672, §7501)

April 5: Passport Revocation Act Differs From Codification (Robert Rowen v. Commissioner, 156 T.C. No. 8 (Mar. 30, 2021) (Judge Toro) — §2714, §6015, §7345)

April 12: The Incoherence of §6751(b) (Andrew Mitchell Berry and Sara Berry v. Commissioner, T.C. Memo, 2021-42 (Apr. 7, 2021) (Judge Marvell) — §6662, §6664, §6751)

April 19: Blind Reliance Is Not Reasonable Reliance (Duane Pankratz v. Commissioner, T. C. Memo. 2021-26 (Mar. 3, 2021) (Judge Holmes) — §6662, §6664 & §6751)

April 26: Abatement Of Assessment Brings No Relief From Liability (Robert Craig Colton and Alina Mazwin v Commissioner, T.C. Memo. 2021-44 (Apr. 21, 2021) (Judge Lauber) — §6151, §6214 & §6404)

May 3: The Multiple Paths For Loss Deductions (Ronnie S. Baum and Teresa K. Baum v. Commissioner, T.C. Memo. 2021-46 (Apr. 27, 2021) (Judge Kerrigan) — §165, §166, §1211, §1212)

May 10: The Measure Of Intent For Gift Exclusions Under §102(a) (Juan Pesante, Jr., and Maria A. Moreno-Pesante v. Commissioner, (Bench Opinion, May 6, 2021) (Judge Copeland) — §102)

May 17: A Timely Lesson For Filing Returns (William J. Spain and Idovia A. Spain v. Commissioner, T.C. Memo. 2021-58 (May 11, 2021) (Judge Lauber) —  §6330, §7502, §7508)

May 24: CDP Settlement Officer Must Work Previously Rejected OIC (Katherine Mason, et. al, v. Commissioner, T.C. Memo. 2021-64 (May 20, 2021) (Judge Holmes) — §6330, §6702, §7122)

June 1: The Structure of Substantiation Requirements (Viola Chancellor v. Commissioner, T.C. Memo. 2021-50 (May 4, 2021) (Judge Urda) — §41, §162, §164, §170, §212, §274, §280)

June 7: The Perils of Stipulations (Donald Bailey and Sandra M. Bailey v. Commissioner, T.C. Memo. 2021-55 (May 10, 2021) (Judge Pugh) — Tax Court Rule 91

June 14: Accounting for Attorney Malpractice Settlements (Carol E. Holliday v. Commissioner, T.C. Memo. 2021-69 (June 7, 2021) (Judge Pugh); Debra Jean Blum v. Commissioner, T.C. Memo. 2021-18 (Feb. 18, 2021) (Judge Urda) — §61, §67 §104)

June 21: A Lesson of Interest (Kannarkat P. Verghese et al. v. Commissioner, T.C. Memo. 2021-70 (June 7, 2021) (Judge Gustafson) — §6404, §6601, §6621, §6622, Tax Court Rule 248)

 June 28: Restitution Overpayment Does Not Reduce Penalties On Deficiencies (Monty Ervin v. Commissioner, T.C. Memo. 2021-75 (June 23, 2021) (Judge Lauber) — §6201 §6201, §6211, §6601, §6651, §6654)

July 6: The CDP Butterfly (Alhaji B. Benson v. Commissioner, T.C. Memo. 2021-78 (June 29, 2021) (Judge Urda) and Monique D. Long v. Commissioner, T.C. Memo. 2021-81 (June 30, 2021) (Judge Lauber) — §6320, §6321, §6322, §6330, §6331, §6334)

July 12: Classic Lesson: The Convenience of the Employer Doctrine (Benaglia v. Commissioner, 36 B.T.A. 838 (1937) (Judge Sternhagen) --- §119)

July 19: For Whom The Bankruptcy Tolls, (Dave Andrew Lufkin Sr., v. Commissioner, T.C. Memo. 2021-71 (June 8, 2021) (Judge Greaves) (teaches how bankruptcy tolls tax collection), Marc. S. Barnes and Anne M. Barnes v. Commissioner, T.C. Memo. 2021-49 (May 4, 2021) (Judge Lauber) (teaches how bankruptcy can also toll assessment) --- §6213, §6501, §6502, §7481, §7485)

July 26: No Deduction For Under-The-Table Cash Payments, Engen Robert Nurumbi v. Commissioner, T.C. Memo. 2021-79 (June 30, 2021) (Judge Pugh),  --- §162

August 2: COGS Are Not Deductions, BRC Operating Company LLC, Bluescape Resource Company LLC, Tax Matters Partner v. Commissioner, T.C. Memo. 2021-59 (May 12, 2021) (Judge Pugh) --- §1001

August 9: Trailer Home Is Union Electrician’s Tax Home, William Geiman v. Commissioner, T.C. Memo. 2021-80 (June 30, 2021), (Judge Urda)

August 16: The Concept Of Reasonable Collection Potential, Jerry R. Abraham and Debra J. Abraham v. Commissioner, T.C. Memo. 2021-97 (Aug. 3, 2021) (Judge Urda) --- §7122

August 23: The Refund Lookback Period Trap, Amr M. Mohsen v. Commissioner, T.C. Memo. 2021-99 (Aug. 11, 2021) (Judge Kerrigan) --- §6511(b)

August 30: The 411 On Section 911, Deborah C. Wood v. Commissioner, T.C. Memo. 2021-103 (Aug. 18, 2021) (Judge Lauber) --- §911

September 7: IRS Can Issue Multiple 'Final' Spousal Relief Determinations, Nilda E. Vera v. Commissioner, 157 T.C. No 6 (Aug. 23, 2021) (Judge Buch) --- §6015(f)

September 13: Retirement Plan Drafting Error Loses Taxpayer $51k Deduction, Gayle Gaston v. Commissioner, T.C. Memo. 2021-107 (Sept. 2, 2021) (Judge Marvel) --- §404(a)

September 20: Failure To Understand Issue Preclusion May Trigger Sanctions, Karson C. Kaebel v. Commissioner, T.C. Memo. 2021-109 (Sept. 9, 2021) (Judge Halpern) --- §6673

September 27: Emotional Distress Is Not Physical Illness, Rebecca A. Tressler v. Commissioner, T.C. Summ. Op. 2021-33 (Sept. 13, 2021) (Judge Greaves) --- §104(a)(2)

October 4: The Many Rooms Of Tax Court Power, Michael D. Brown v. Commissioner, T.C. Memo. 2021-112 (Sept. 23, 2021) (Judge Kerrigan) --- §6512(b)

October 11: Sex And Deductions, Vitale v. Commissioner, T.C. Memo. 1999-131 (Judge Fay) (denied deductions), Hess v. Commissioner, T.C. Summary Opinion 1994-79 (Judge Joan Seitz Pate) (permitted a depreciation deduction) --- §162 and §262

October 18: The Great Divide, Carl L. Gregory and Leila Gregory v. Commissioner, T.C. Memo. 2021-115 (Sept. 29, 2021)(Judge Jones) --- §62, §63, §67, §183

October 25: Of Distributive Shares And The CDP Mashup, Taryn L. Dodd v. Commissioner, T.C. Memo. 2021-118 (Oct. 5, 2021) (Judge Lauber) --- §701 §701, §702, §703, §1231, §6015, §6320, §6330

November 1: Whistleblower Died, But His Claim Survived, Joseph A. Insinga v. Commissioner, 157 T.C. No. 8 (Oct. 27, 2021) (Judge Gustafson) --- Tax Court Rule 63(a), §7623

November 8: A Hard Choice Is Still A Choice, Pamela Cashaw v. Commissioner, T.C. Memo. 2021-123 (Oct. 27, 2021) (Judge Greaves) --- §6672

November 15: Not Every Decision Comes With An Opinion, Paul Puglisi & Ann Marie Puglisi, et. al., v. Commissioner (unpublished order) (Nov. 5, 2021) (Judge Gustafson) --- §831, §6214, §7430, §7459

November 22: How To Mess Up Your Checkbook IRA, Andrew McNulty and Donna McNulty v. Commissioner, 157 T.C. No. 10 (Nov. 18, 2021) (Judge Goeke) --- §408

November 29: Who Is An IRS Employee's Immediate Supervisor For §6751 Penalty Approval?, Sand Investment Co., LLC, et al. v. Commissioner, 157 T.C. No. 11 (Nov. 23, 2021) (Judge Lauber) --- §6751(b)(1)

December 6: Taxpayer 'Filed' Return Even Though IRS Could Not Process It, James Forrest Willetts v. Commissioner, T.C. Sum. Op. 2021-39 (Nov. 22, 2021) (Judge Kerrigan) --- §6511(a), §6501(b)(1), §6513(a)

Judge Date Post
Buch September 7 IRS Can Issue Multiple 'Final' Spousal Relief Determinations
Copeland May 10 The Measure Of Intent For Gift Exclusions Under §102(a)
Fay October 11 Classic Lesson: Sex And Deductions
Goeke November 22 How To Mess Up Your Checkbook IRA
Greaves February 8 When A Hotel Becomes A Tax Home
March 8 New ‘Consequential Moment’ Rule for §6751 Supervisory Approval
July 19 For Whom The Bankruptcy Tolls
September 27 Emotional Distress Is Not Physical Illness
November 8 A Hard Choice Is Still A Choice
Gustafson June 21 A Lesson of Interest
November 1 Whistleblower Died, But His Claim Survived
November 15 Not Every Decision Comes With An Opinion
Halpern January 11 Too Much Control Over IRA Distribution Makes It Income
February 1 No Product? No §162 Deduction!
March 29 Failing Business No Reason To Stop Collection In CDP Hearing
September 20 Failure To Understand Issue Preclusion May Trigger Sanctions
Holmes March 22 S Corp Payments to Sole Shareholder Were Wages
April 19 Blind Reliance Is Not Reasonable Reliance
May 24 CDP Settlement Officer Must Work Previously Rejected OIC
Jones October 18 The Great Divide
Kerrigan February 15 The §104(a)(2) Causality Rule
May 3 The Multiple Paths For Loss Deductions
August 23 The Refund Lookback Period Trap
October 4 The Many Rooms Of Tax Court Power
December 6 Taxpayer 'Filed' Return Even Though IRS Could Not Process It
Lauber April 26 Abatement Of Assessment Brings No Relief From Liability
May 17 A Timely Lesson For Filing Returns
June 28 Restitution Overpayment Does Not Reduce Penalties On Deficiencies
July 6 The CDP Butterfly
July 19 For Whom The Bankruptcy Tolls
August 30 The 411 On Section 911
October 25 Of Distributive Shares And The CDP Mashup
November 29 Who Is An IRS Employee's Immediate Supervisor For §6751 Penalty Approval?
Marvell April 12 The Incoherence of §6751(b)
September 13 Retirement Plan Drafting Error Loses Taxpayer $51k Deduction
Pugh January 25 No Deduction for Disguised Dividends
June 7 The Perils of Stipulations
July 26 No Deduction For Under-The-Table Cash Payments
August 2 COGS Are Not Deductions
Seitz Pate October 11 Classic Lesson: Sex And Deductions
Sternhagen July 12 Classic Lesson: The Convenience of the Employer Doctrine
Thornton March 15 The Presumption Of Regularity For NODs
Toro January 19 The CDP Silver Linings Playbook
February 22 The Fearsome Scope of Evil §208E
April 5 Passport Revocation Act Differs From Codification
Urda March 1 No Second Bite In CDP For Rejected OIC
June 1 The Structure of Substantiation Requirements
June 14 Accounting for Attorney Malpractice Settlements
August 9 Trailer Home Is Union Electrician’s Tax Home
August 16 The Concept Of Reasonable Collection Potential

A Year Of Lessons From The Tax Court (2020)

https://taxprof.typepad.com/taxprof_blog/2021/12/a-year-of-lessons-from-the-tax-court-2021.html

Bryan Camp, Miscellaneous, Tax, Tax News, Tax Practice And Procedure, Tax Scholarship | Permalink

Comments

Thank you for providing this extraordinarily helpful and convenient listing of your great articles!

Am commenting a little belatedly on the November 8 article, “A Hard Choice Is Still A Choice, Pamela Cashaw v. Commissioner,” but am wondering what distinguishes a civil case under sec. 6672, such as the one here, from a criminal one under sec. 7202? While one difference would be the required quantum of proof, perhaps also “willfully” would be defined much less liberally (with that “bad intent” included) in the context of the latter as opposed to the former? This case, or more precisely the Slodov case cited therein, touches on that question, but does not answer it: https://law.justia.com/cases/federal/appellate-courts/F3/201/214/642703/

Posted by: David Yos | Dec 29, 2021 1:47:07 PM

Should note that Subchapter C applies to S corporations when there is no contrary rule in Subchapter S itself or elsewhere in the Internal Revenue Code [Section 453B(h), par example].
Under section 301(c) a C shareholder will not pay tax on a recovery of basis under paragraph 2.
To the extent that the accumulated adjustment account exceeds a shareholder’s basis, a distribution from the so-called triple A account may be taxable as capital gain.
Technically, under the statute, a corporation that has always been an S corporation does not have a triple A account so that only subsections (b) and(a) of section 1368 are relevant.
S corporations are a poor entity selection choice unless the shareholder expects to pay unreasonably low wages to avoid one or both parts of the FICA exaction.
As a taxpayer who, with his wife, collects $66,500 in social security benefits I wish for the trust funds to remain solvent.
Consequently, I practice as a sole proprietor, not an S corporation.
As I wrote to President Biden:
The Social Security Trust Fund for Old-Age and Survivors Insurance and the Social Security Trust Fund for Disability Insurance are unsustainable as currently operated. The Congress, however, clearly lacks the will to make necessary amendments to the system. Consequently, a new “Greenspan” Commission would be required to recommend solutions that the Congress is otherwise unwilling and unable to enact. And Chairman Ben Shalom Benanke would be the ideal chairman. Members of the new commission should be budget hawks with a singular character trait brimming with rachmonis. Some of the obvious steps needed to ensure future solvency would be:

(a) Increase the full retirement age to at least seventy years of age

(b) Increase the Federal Insurance Contributions Act tax to at least 9.5 percent

(c) Make all wages and earned income subject to the larger portion of the tax as is currently the law for the smaller Medicare tax portion.

(d) Treat S corporations as partnerships are treated, that is, the undistributed taxable income would be subject to the payroll tax

(e) Cease adding new benefits to the system unless such increases are actuarially funded

Posted by: Jonathan S. Ingber | Dec 21, 2021 11:17:39 AM

Post a comment