IRS FRIVOLOUS ARGUMENT PENALTY-RALEIGH & WILMINGTON, NC NORTH MYRTLE BEACH & MYRTLE BEACH, SC

A recent Tax Court decision was reported dealing with Frivolous Arguments’ Penalty.  J.  Frank Best, Tax Controversy CPA/U. S. Tax Court Litigator in Raleigh and Wilmington, NC  & North Myrtle Beach and Myrtle Beach, SC works to stay current on all IRS decisions concerning tax litigation to ensure we are fully Informed and prepared for our clients.

J. Frank Best, Tax Controversy CPA is rated in the top 5 Tax Controversy CPA/Profiles Linkedin https://www.linkedin.com/title/tax-controversy-cpa

EMAIL: bestcpa@bestirscpa.com

PHONE: 1-800-230-7090

IRS Frivolous Arguments’ Penalty/J. Frank Best, Tax Controversy CPA/U. S. Tax Court Litigator

A recent Tax Court decision was reported dealing with Frivolous Arguments’ Penalty.  J.  Frank Best, Tax Controversy CPA/U. S. Tax Court Litigator in Raleigh and Wilmington, NC  & North Myrtle Beach and Myrtle Beach, SC works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients. 

IRS Supervisor Approval Not Required for Tax Court to Assess Frivolous Arguments’ Penalty

The Tax Court held that its authority to impose a frivolous argument penalty under Code Sec. 6673 for making a frivolous argument before the Tax Court is not subject to the IRS supervisor approval requirement in Code Sec. 6751(b)(1). The Tax Court found that (1) Congress’s intent in enacting the supervisor approval requirement was to prevent IRS agents from threatening unjustified penalties to encourage taxpayers to settle, while Code Sec. 6673 is designed to deter bad behavior in the Tax Court and conserve judicial resources, and (2) Code Sec. 6751(b)(1) was clearly not intended as a mechanism to restrain the Tax Court. Williams v. Comm’r, 151 T.C. No. 1 (2018).

The Tax Court concluded that Code Sec. 6751(b)(1) was not intended as a broad restraint mechanism on the federal judiciary. In the court’s view, Congress did not intend for the statute to cover the imposition of penalties that could be imposed by courts because of misbehavior by a litigant during the course of a judicial proceeding.