Volume 129 — Tax Court Reports

P filed a petition pursuant to sec. 6015(e), I.R.C., seeking relief from R's determination to deny spousal relief from unpaid joint tax… Held: The amount of relief sought for purposes of sec. 7463(f)(1), I.R.C., includes the total amount of tax, interest, and penalties, including accrued but unassessed interest and penalties, for which relief is sought in the petition calculated as of the date the petition is filed. The total amount of relief P seeks exceeds $ 50,000.

R determined, in a notice of final partnership administrative adjustment, that P was liable for sec. 6662(a) and (h), I.R.C. penalties. R sent P a notice of deficiency and assessed the penalties against P. P filed a petition with this Court and asserted a partner-level defense relating to the penalties. R filed a motion to dismiss for lack of jurisdiction and contended that the Court lacks jurisdiction to determine whether P is liable for the penalties. Held: This Court lacks jurisdiction to determine whether P is liable for the penalties. Secs. 6221, 6230(a)(2)(A)(i), I.R.C.

As part of a Son-of-BOSS transaction designed to create a basis of approximately $ 29.3 million in publicly traded stock purchased at a relatively minimal cost, P entered into a short sale of U.S.… Held: Sec. 6230(a)(2)(A)(i), I.R.C., makes the deficiency procedures applicable to R's disallowance of the passthrough loss from DII.

In a series of transactions between 1998 and 2000, P exercised incentive stock options (ISOs), acquiring 40,362 shares of V stock. In 2001, Ps sold 30,297 V shares for $ 1,688,875. Held: The difference between the adjusted AMT basis and the regular tax basis of stock received through the exercise of an ISO is not a tax adjustment taken into account in the calculation of an ATNOL in the year the stock is sold.

Held: Certain items relating to the purported contributions of certain Euro options to Evergreen Trading, LLC, by its respective members, including such members' respective bases in such options, are… Held: Certain items relating to the purported contributions of certain Euro options to Evergreen Trading, LLC, by its respective members, including such members' respective bases in such options, are partnership items, as defined in sec. 6231(a)(3), I.R.C.

After this Court ruled for Ps in the instant collection case, Ps moved for an award of costs under sec. 7430, I.R.C. 1986, and then for sanctions under sec. 6673(a)(2), I.R.C. 1986. Held: Both memoranda were work product when prepared for the case in chief and continue to be work product in the current stage of the litigation. 2.

P timely filed his Federal income tax return for 2000 but failed to pay fully the amount reported as due. Held: P did not have an opportunity to dispute his underlying tax liability for 2000 within the meaning of sec. 6330(c)(2)(B), I.R.C., by virtue of his earlier request, still pending when the collection action was initiated, for Appeals Office consideration and abatement of the liability.

Ps filed a petition pursuant to sec. 6330(d), I.R.C., challenging R's determination concerning collection of Ps' unpaid income tax for the years 19962000. Held: For a case to qualify for the small tax case procedures under sec. 7463(f)(2), I.R.C., the total amount of unpaid tax (which includes interest and penalties), calculated as of the date of the notice of determination, cannot exceed $ 50,000. The amount of the underlying tax liability in dispute is irrelevant.

R mailed a notice of deficiency to Ps' last known address, but Ps did not receive it because they had moved. Held: Under sec. 301.6330-1(e)(3) Q&A-E2, Proced. & Admin. Regs., 12 days was insufficient time to allow Ps to petition this Court for redetermination of a notice of deficiency. Therefore, Ps were not barred from contesting the underlying tax liability at their sec. 6330, I.R.C., hearing.

P, an individual, is the sole beneficiary of an irrevocable trust (T) which owns a 13-percent interest in a general partnership (O). Held: Pursuant to sec. 6223(c)(3), I.R.C., and sec. 301.6223(c)-1T(f), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6784 (Mar. 5, 1987), R's mailing of the FPAA to P, readily identified in R's records as an indirect partner of O within the meaning of sec. 6231(a)(10), I.R.C., met the notice requirement of sec. 6223(a), I.R.C.

P sought review of respondent's denial of innocent-spouse relief under section 6015, triggering respondent's obligation to notify her husband of his right to intervene. Held: A nonrequesting spouse's right to intervene survives death, and respondent is obliged to try appropriate means to notify any heirs, executors, or administrators.

P and his spouse (S) divorced in December 1993. The divorce decree required P and S to share equally their children's uninsured medical and dental costs. Held: P's payments to S relating to his children's dental bills are, pursuant to sec. 71(c)(3), 1Unless otherwise indicated, all section references are to the Internal Revenue Code of 1986, as amended. child support. 2.

R sent to P a notice of deficiency for 1999. Held: The Court lacks jurisdiction to review P's claim for relief under sec. 6015(c), I.R.C., because, in the context of the TEFRA partnership proceeding, P's claim for relief from joint and several liability on a joint return may be raised only after R has sent a notice of computational adjustment following the completion of…

P and his wife filed a joint Federal income tax return for the 2001 tax year reporting a tax due. P failed to pay the amount due with the joint return. Held: R did not abuse his discretion in rejecting the installment agreement when P failed to make estimated tax payments.

P is the holding company of an affiliated group of corporations that files consolidated Federal income tax returns. Held: The calculation of B's average adjusted bases of tax-exempt obligations does not include the tax-exempt obligations purchased by IC.

In 1997, P, an attorney practicing in Oklahoma, donated to a university library photocopied materials received from the Government in connection with P's representation of a criminal defendant. Held: Under Oklahoma law, an attorney does not own his client's case file, but rather maintains custodial possession of the file.

With the late filing of their 1990 joint Federal income tax return, petitioners failed to pay most of the $ 63,499 taxes reported due. In 1994, petitioners filed a bankruptcy petition. Held: respondent mailed to petitioners an adverse notice of determination relating to the NFTL and an adverse decision letter relating to the notice of intent to make a second levy.

Bs received a notice of deficiency but filed no petition in this Court. Held: R committed no abuse of discretion in issuing the notice of determination, because section 6330(c) bars taxpayers who've received a notice of determination from challenging their underlying tax liability, and an offer-in-compromise based only on doubt as to liability is a challenge to that underlying liability.