Norberg v. Commissioner
T.C. Memo. 2022-30

On April 5, 2022, the Tax Court issued a Memorandum Opinion in the case of Norberg v. Commissioner (T.C. Memo. 2022-30). The primary issue presented in Norberg v. Commissioner was whether the settlement officer abused its discretion in upholding a notice of intent to levy and denying the petitioners’ request to be placed in currently not collectible status (despite having the ability to make payments). Held:  Background to Norberg v. Commissioner In February 2019, the petitioners filed a delinquent Federal income tax return for 2016. That return reported a tax liability of $42,000. The petitioners did not enclose full payment with the return, and as of September 2019, their outstanding liability for 2016 was about $9,200. In September 2019, in an effort to collect this liability, the IRS issued a levy notice to the petitioners, and they timely requested a CDP hearing. They expressed interest in a collection alternative, checking…

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Salter v. Commissioner
T.C. Memo. 2022-29

On April 5, 2022, the Tax Court issued a Memorandum Opinion in the case of Salter v. Commissioner (T.C. Memo. 2022-29). The primary issues presented in Salter v. Commissioner were (i) whether the Code section providing exception from imposition of additional tax resulting from early distribution from retirement plan applied; and (ii) whether the taxpayer was entitled to itemized deductions when he failed to file a return, and the IRS filed a substitute for return on his behalf. Held: Nope on both counts, Shawn. Background to Salter v. Commissioner The IRS issued a notice of deficiency for 2013 to the petitioner after he failed to file a Federal income tax return for that year. He did not dispute the items of gross income shown in the notice of deficiency. However, he did dispute his entitlement to itemized deductions, the computation of an IRC § 72(t) additional tax for an early…

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Middleton v. Commissioner
T.C. Memo. 2022-28

On April 4, 2022, the Tax Court issued a Memorandum Opinion in the case of Middleton v. Commissioner (T.C. Memo. 2022-28). The primary issues presented in Middleton v. Commissioner were (i) whether the taxpayer could challenge the Trust Fund Recovery Penalty at his CDP hearing; and (ii) whether the taxpayer established that he was not “responsible person” for collecting, accounting for, and paying over employees’ income and employment taxes. Background to Middleton v. Commissioner In March 2007, Lineation Marketing Co. (Lineation) was organized and registered with the California secretary of state. Lineation provided roadway striping and signage. The petitioner was the responsible managing officer for Lineation during the relevant tax periods. Bank records show that the petitioner opened a checking account for Lineation in December 2012, and a savings account in September 2013. He was the only signer on the bank accounts. In November 2015, a revenue officer interviewed the…

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Villanueva v. Commissioner
T.C. Memo. 2022-27

On March 31, 2022, the Tax Court issued a Memorandum Opinion in the case of Villanueva v. Commissioner (T.C. Memo. 2022-27). The primary issue presented in Villanueva v. Commissioner was whether the petitioner was entitled to a net operating loss deduction. Held: Sorry, Edgardo, not today. Background to Villanueva v. Commissioner The IRS determined deficiencies against the petitioner for 2013 and 2014 of $61,832 and $90,408, respectively, and an IRC § 6662(a) accuracy-related penalty and an IRC § 6651(a)(1) addition to tax for failure to timely file a return for each year. The petitioner had his 2013 tax return prepared by an enrolled agent, who also assisted petitioner with the audit of his 2013 and 2014 tax returns. Strike one, Edgardo. The petitioner reported a loss of $112,357 on Form 4797, Sales of Business Property, attached to his 2013 return, from the disposition of a condominium in Newport Beach, California…

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Golditch v. Commissioner
T.C. Memo. 2022-26

On March 29, 2022, the Tax Court issued a Memorandum Opinion in the case of Golditch v. Commissioner (T.C. Memo. 2022-26). The primary issues presented in Golditch v. Commissioner were (i) whether the taxpayer was permitted to challenge his underlying tax liability at CDP hearing; (ii) whether the taxpayer’s argument that liabilities were not properly assessed because substitutes for return were invalid was frivolous; and (iii) whether the imposition of frivolous position penalty on taxpayer was warranted. Held: Oh, Jason, frivolity will get you nowhere…especially with Judge Lauber presiding… Background to Golditch v. Commissioner Judge Lauber leads with this ignominious line, which never bodes well for the petitioner: Petitioner is a serial nonfiler.[1] The many years for which he failed to file Federal income tax returns include 2011 and 2012. The IRS prepared for each year a substitute for return (SFR) that met the requirements of IRC § 6020(b). The…

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Porter v. Commissioner
T.C. Memo. 2022-25

On March 28, 2022, the Tax Court issued a Memorandum Opinion in the case of Porter v. Commissioner (T.C. Memo. 2022-25). The primary issues presented in Porter v. Commissioner were whether (i) delays in examination and litigation were attributable to IRS officer or could significantly be attributed to taxpayer; and (ii) whether the interest on a deficiency settlement should be abated. Held: Not today, Jeremy. Porter v. Commissioner (Very) Briefly The IRS audited the petitioner’s 2011 and 2012 taxes, issuing a notice of deficiency in 2014, in response to which the petitioner timely filed a Tax Court petition, which was ultimately settled in 2019. The petitioner paid $1,720 of interest on the stipulated deficiency for 2011 on or around August 12, 2019, and $1,349 of interest on the stipulated deficiency for 2012 on or around February 3, 2020. The Request for Abatement of Interest On or around October 19, 2019,…

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Addis v. Commissioner
T.C. Memo. 2022-24

On March 28, 2022, the Tax Court issued a Memorandum Opinion in the case of Addis v. Commissioner (T.C. Memo. 2022-24). The primary issue presented in Addis v. Commissioner was whether the frivolous taxpayer’s CDP rights had been violated. Held: Not quite, Jonah. Mr. Addis’s 2014 Tax Reporting On March 17, 2017, Jonah Addis filed a delinquent tax return for his 2014 tax year, reporting zero dollars of income and a refund due of approximately $3,000. In support of his return, he submitted Form 4852, Substitute for Form W-2, Wage and Tax Statement, or Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc., for various employers (Navigant Consulting, Inc., Click Click Boom LLC, Treliant Risk Advisors, Clayton Support Services, and Francis David Corp.), on which he reported no income. Mr. Addis also submitted Form 8888, Allocation of Refund (Including Savings Bond Purchases), on which he…

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