United States Tax Court Decision for the Week – You be the Judge

A Prior Bankruptcy Decision Bars Challenge to Tax Deficiency and Innocent Spouse Relief

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court, sustaining a collection action, held that the doctrine of res judicata bars a married couple from challenging the timeliness and validity of notices of deficiency, finding that those issues were previously resolved during bankruptcy proceedings, and that res judicata also bars the wife from seeking innocent spouse relief.

RICHARD E. SNYDER AND MARION B. SNYDER,
Petitioners
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent

RICHARD E. SNYDER AND MARION SNYDER,
Petitioners
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent

T.C. Memo. 2015-26

 

United States Tax Court Decision for the Week – You be the Judge

IRS Settlement Officer  Did not Abuse Discretion in Properly Denying Installment Agreement Request 

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The  United States Tax Court held that an IRS settlement officer did not abuse her discretion in denying an individual an installment agreement and in sustaining a proposed collection action against him, explaining that the individual failed to submit requested financial information.

TIMOTHY FREDERICK WITMYER,
Petitioner
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent

T.C. Memo. 2015-17

United States Tax Court Decision for the Week – You be the Judge

No IRS Abuse of Discretion when Installment Agreement Does Not  Preclude Notice of Federal Tax Lien Filing

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court, in a summary opinion, held that the IRS did not abuse its discretion in a determination sustaining a notice of federal tax lien filing against a couple who had an installment agreement, but who had defaulted on prior agreements; the court also held that equitable estoppel should not be applied against the IRS to stop the lien filing.

KENNETH JOHN MELIKIAN AND SHARON KAYE MELIKIAN,
Petitioners
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent

T.C. Summ. Op. 2014-114

United States Tax Court Decision for the Week – You be the Judge

The Statute of Limitations Period Bars IRS’s Lien Collection Efforts

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court held that an Appeals Office IRS settlement officer improperly sustained a notice of federal tax lien to recover a trust fund recovery penalty against an individual, finding that collection was barred because the 10-year limitations period in Code section 6502 had expired and was not tolled by the individual taxpayer’s frequent trips outside the United States.

KIM REINHART,
Petitioner
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent.

T.C. Memo. 2014-218

United States Tax Court Decision for the Week – You be the Judge

The United States Tax Court Finds No Abuse in IRS’s Decision to Sustain Levy

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court, in a summary opinion, held that an IRS settlement officer did not abuse her discretion by sustaining a notice of intent to levy against an individual, finding that the individual failed to provide requested financial information or to show he would be unable to pay his tax liability within the collection limitations period.

ALLAN L. BLANK, Petitioner

v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

T.C. Summ. Op. 2014-86

 

United States Tax Court Decision for the Week – You be the Judge

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court imposed a $10,000 penalty under Internal Revenue Code section 6673(a)(1) against a taxpayer who litigated his income tax liability in the tax court and federal courts, holding that he was previously warned against making frivolous arguments; the court also granted the IRS summary judgment in the collection action.

ALVIN SHELDON KANOFSKY,
Petitioner
v.
COMMISSIONER OF INTERNAL REVENUE,  Respondent

T.C. Memo. 2014-153

 

 

United States Tax Court Decision for the Week – You be the Judge

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court held that the IRS didn’t abuse its discretion by refusing to rescind a notice of intent to levy to collect trust fund recovery penalties while an individual’s installment agreement request was pending; the court remanded the case to the Appeals Office to clarify its basis for a down payment as a condition of the installment agreement.

Renald Eichler sent the IRS a proposed partial-payment installment agreement for trust fund recovery penalties the IRS assessed against him. However, before the IRS addressed the proposed installment agreement, it sent him a notice of intent to levy regarding the penalties. Eichler requested a collection due process hearing and also asked that the IRS rescind the notice of levy because the installment agreement was pending. The IRS proceeded with the CDP hearing and proposed an installment agreement that required a down payment. When Eichler rejected the agreement because of economic hardship, the IRS sustained the proposed levy. Eichler petitioned the Tax Court for review, arguing that the IRS was precluded by section 6331(k)(2) from issuing the notice of levy while the installment agreement was pending.

Tax Court Judge Michael B. Thornton wrote that section 6331(k)(2), which prohibits the IRS from making a levy while an offer for an installment agreement is pending, didn’t preclude issuance of the notice. Thornton found support for the court’s conclusion in reg. section 301.6331-4(b)(1), which provides that the IRS may take action other than a levy to protect the government’s interest. The court held that there was no abuse of discretion in the IRS’s refusal to rescind the notice of intent to levy.

However, Thornton remanded the case to the IRS Appeals Office to clarify the appeals officer’s basis for requiring a down payment as a condition of the installment agreement. The court found that there was no indication in the record that the appeals officer considered issues regarding Eichler’s and his wife’s ages and their limited financial resources or the claim that funds in a bank account had been loaned to them. The court stated that any new collection alternatives should be considered on remand.

RENALD EICHLER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent

 143 T.C. No. 2

United States Tax Court Decision for the Week – You be the Judge

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The Tax Court upheld the IRS’s determination to proceed with collection actions against a taxpayer for unpaid taxes for three tax years, finding that the taxpayer hadn’t provided any evidence to challenge the underlying liability and that the settlement officer based her determination on the required factors and hadn’t abused her discretion.

JAMES CROPPER,
Petitioner
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent

T.C. Memo. 2014-139

United States Tax Court Decision for the Week – You be the Judge

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The Tax Court held that an individual couldn’t challenge his underlying tax liability under Internal Revenue Code Section 6330(c)(2)(B)based on his failure to receive a notice of deficiency, finding that he declined to check his mail and retrieve the notice that the IRS attempted to send him by certified mail.

The IRS sent Eric Onyango a notice of deficiency for tax years 2006 and 2007 by certified mail to his legal address. The U.S. Postal Service attempted to deliver the notice and left notifications of its attempted delivery. However, Onyango admittedly failed to check his mail at that address even though he was there 30 to 40 percent of the time. Therefore, he didn’t receive the notice of deficiency, and it was returned to the IRS. The IRS eventually made determinations to proceed with collection actions against Onyango for his unpaid taxes, and he petitioned the Tax Court, claiming that he was entitled to challenge his underlying tax liability for tax year 2006 under section 6330(c)(2)(B) because he didn’t receive a notice of deficiency.

The United States Tax Court, in an opinion by Judge Carolyn P. Chiechi, held that Onyango wasn’t entitled to challenge the liability. The court found that although he was at the address at least some of the time during the period when the post office attempted delivery, he declined to check his mail. The court further found that he failed to do so even though he knew that the IRS was considering adjustments to his taxes and had communicated that it would send him a notice of deficiency. Chiechi concluded, “We hold that petitioner may not decline to retrieve his Postal Service mail, when he was reasonably able and had multiple opportunities to do so, and thereafter successfully contend that he did not receive for purposes of section 6330(c)(2)(B) the 2006-2007 notice of deficiency.”

ERIC ONYANGO, Petitioner v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

142 T.C. No. 24

United States Tax Court Decision for the Week – You be the Judge

A recent Tax Court decision was reported that may be of interest to individuals potentially dealing with tax litigation. J. Frank Best, Certified Public Accountant and United States Tax Court Practitioner, works to stay current on all IRS decisions concerning tax litigation to ensure we are fully informed and prepared for our clients.

The United States Tax Court held that the IRS didn’t abuse its discretion by sustaining a notice of federal tax lien filing against a couple, but it did abuse its discretion by failing to request financial information from the couple to consider collection alternatives; the court remanded the case to the Appeals Office to consider their request for an installment plan.

JOSE L. URIBE AND MARIA E. URIBE,
Petitioners
v.
COMMISSIONER OF INTERNAL REVENUE,
Respondent

T.C. Memo. 2014-116