Small Business Taxes & Management

Tax Court Cases--2012

Below is a list of the 2012 cases of the U.S. Tax Court with direct links to the full text at the Tax Court web site. The text of the cases is in PDF format, so a Adobe Acrobat Reader is required. The case name may differ from the official Tax Court name. We've substituted et ux. and et vir for the spouse's full name and et al. for additional petitioners. The list below contains the case name, cite, the Code sections and key words for the issues in the case. We've kept the key word list short to make searches easy. Use the "find-in-page" or "find" feature of your browser (CTRL-F) to search this list. Be sure to try variations of keywords such as "activities" as well as "activity"; "depreciation" as well as "depreciate". Please note that the mention of an issue does not in any way imply the outcome. For example, if "fraud penalty " is mentioned, that only means the fraud penalty was an issue, not that it was imposed or rejected by the Court. When searching be sure to try variations of the word. E.g., for depreciation also try depreciated and depreciation. Hypenation has become an art form. Try searches with and without. The majority of cases mention Sec. 7491 (Burden of Proof); we have not listed it unless it was a significant issue. Keep in mind that you can go to the U.S. Tax Court at www.ustaxcourt.gov and use their search engine (use the "Opinions Search" tab) to look for additional cases or words that we have not indexed. Their site contains full Tax Court cases (TC) and Tax Court Memorandum Opinions starting September 25, 1995 and Summary Opinions starting January 1, 2001.

For a similar synopsis of cases for prior years, go to:

Tax Court Cases--2011
Tax Court Cases--2010
Tax Court Cases--2009
Tax Court Cases--2008
Tax Court Cases--2007
Tax Court Cases--2006
Tax Court Cases--2005
Tax Court Cases--2004

New Additions - Week Ended February 18, 2012

Tax Court Cases

Memorandum Decisions

Summary Opinions

Moe Mobasher T.C. Summary Opinion 2012-14 Sec. 162; 262; business expenses; living expenses; profit motive; not engaged in trade or business.

Cumulative Cases - 2012

Tax Court Cases

Tigers Eye Trading LLC et al. 138 T.C. No. 6 Sec. 6231; 6233; 6662; partnership item definitions; partnership status redeterminations; accuracy-related penalty; adjustment of outside basis; gross valuation misstatement penalties; son-of-BOSS.
Eugene Kaprowski 138 T.C. No. 5 Sec. 6015; innocent spouse relief; res judicata; small case procedure; participation in prior proceeding.
Francis T. Foster et ux. 138 T.C. No. 4 Sec. 36; first-time homebuyer credit; qualification for credit; principal residence owned within three years of purchase.
Myles Lorentz Inc. 138 T.C. No. 3 Sec. 34; 4041; 4081; 6421; 6427; 7701; credit for fuel taxes; special fuels tax; gasoline tax; nonhighway use of gas; nontaxable fuels; definitions; qualification of tractors for off-highway exception.
Caltex Oil Venture et al. 138 T.C. No. 2 Sec. 461; 6226; year of deduction; partnership court review; intangible drilling costs; economic performance and 3-1/2 month rule; FPAA.
Ann Marie Minihan et al. 138 T.C. No. 1 Sec. 6015; 6331; innocent spouse relief; levy and distraint; right to 50 percent interest in joint bank account levied by IRS; entitlement to refund if innocent spouse.

Memorandum Decisions

Judith Gaerttner et vir. T.C. Memo. 2012-43 Sec. 170 213; charitable deductions; medical expenses; expenses reimbursed by insurance; substantiation; recordkeeping; documentation.
Robert C. Hughes T.C. Memo. 2012-42 Sec. 6320; 6330; hearing on filing lien notice; hearing before levy; collection due process; petition filed prematurely; no notice of determination.
Scott P. Lysford et ux. T.C. Memo. 2012-41 Sec. 167; 179; 274; 280F; 732; 6662; depreciation deduction; expensing business assets; business expense substantiation; luxury autos and listed property; basis of distributed property; accuracy-related penalty; business use of airplane; recordkeeping; documentation.
George James Gowen et ux. T.C. Memo. 2012-40 Sec. 6330; hearing before levy; collection due process; tax lien filing sustained; challenge of underlying liability.
Mark A. Leago T.C. Memo. 2012-39 Sec. 330; 7122; hearing before levy; offer in compromise; collection alternatives offered by taxpayer; medical issues.
Steven A. Esrig et al. T.C. Memo. 2012-38 Sec. 172; 179; 1001; 1011; 1012; 1016; 6651; 6654; 6662; net operating loss; expensing business assets; gain or loss; adjusted basis; cost basis; adjustments to basis; failure to file or pay; failure to pay estimated tax; accuracy-related penalty; substantiation; recordkeeping; documentation; unreported rental income; gain on sale of property.
Jerry John Kobs T.C. Memo. 2012-37 Sec. 6320; 6330; hearing on filing lien notice; hearing before levy; collection due process; challenge of underlying tax liability; failure to file timely petition.
Lisa LaFlamme T.C. Memo. 2012-36 Sec. 6662; accuracy-related penalty; deduction for pension contribution not allowed for self-employment tax.
Esgar Corp. et al. T.C. Memo. 2012-35 Sec. 170; 6662; 6664; charitable deductions; accuracy-related penalty; penalty definitions and special rules; valuation of conservation easements; highest and best use of property; gravel mine; estimate of demand for gravel.
Sam William Palmer T.C. Memo. 2012-34 Sec. 6212; 6651; 7701; notice of deficiency; failure to file or pay; definitions; frivolous arguments; notice of deficiency from wrong IRS office.
Barbara Ann Delon et vir T.C. Memo. 2012-33 Sec. 6330; hearing before levy; collection due process; dispute of underlying tax liability.
Paul R. Avenell et ux. T.C. Memo. 2012-32 Sec. 6663; fraud penalty; IRS failure to show fraud; expiration of limitations period.
John Hancock et ux. T.C. Memo. 2012-31 Sec. 6404; abatements; IRS error in performing ministerial task; guidance to taxpayer on interest on liability.
Burton Tucker T.C. Memo. 2012-30 Sec. 6320; 6330; 6702; hearing on filing lien notice; hearing before levy; frivolous income tax returns; bona fide issues not raised.
Sheila Philemond T.C. Memo. 2012-29 Sec. 2; 24; 32; 151; 152; head of household; child credit; earned income credit; personal exemptions; dependent definition; noncustodial parent; qualifying child.
Sean S. Brown T.C. Memo. 2012-28 Sec. 61; 6662; 6664; gross income definition; accuracy-related penalty; penalty definitions and special rules; interest on settlement; reasonable cause exception not offered.
Ronald E. Byers T.C. Memo. 2012-27 Sec. 6020; 6330; dummy returns; hearing before levy; collection due process.
Sue Colvin et vir T.C. Memo. 2012-26 Sec. 162; 274; 6662; business expenses; travel and entertainment; accuracy-related penalty; documentation; substantiation; recordkeeping.
Robert Jay Brooks et ux. T.C. Memo. 2012-25 Sec. 61; 108; 163; 212; debt cancellation; discharge of indebtedness; investment interest; expense of producing income; loan from employer forgiven; deductibility of interest if paid.
Terrance Clem Wright T.C. Memo. 2012-24 Sec. 6320; 6323; 6330; hearing on filing lien notice; priority of liens; hearing before levy; collection due process; failure to provide financial information.
L.A. Samarasinghe et ux. T.C. Memo. 2012-23 Sec. 165; 469; 6662; 6664; losses; passive loss limitations; accuracy-related penalty; penalty definitions and special rules; rental to related entity; lease in effect; adherence to lease terms; written binding contract entered into before February 19, 1988.
William B. Perrin T.C. Memo. 2012-22 Sec. 6330; 6672; hearing before levy; failure to pay over tax; collection due process; challenge of trust fund recovery penalties; unpaid employment taxes; levy action.
John P. Owen et al. T.C. Memo. 2012-21 Sec. 1045; 1202; 6662; rollover of stock gain; small business stock; accuracy-related penalty; omitted income; assignment of income; personal services corporation; deferral of capital gain; employment termination payment.
Ivan Rivas T.C. Memo. 2012-20 Sec. 6020; 6330; dummy returns; hearing before levy; collection due process; substitute returns; levy; challenge of underlying tax liability; face-to-face hearing denied.
Alfred A. Iversen et ux. T.C. Memo. 2012-19 Sec. 469; 6662; passive loss limitations; accuracy-related penalty; material participation; cattle and horse ranching; reliance on accountant.
Peco Foods Inc. et al. T.C. Memo. 2012-18 Sec. 338; 481; 1060; 1245; stock purchase and asset purchase; changes in accounting method; asset acquisition allocations; property depreciation recapture.
Peter C. Bronson et ux. T.C. Memo. 2012-17 Sec. 183; 6662; not-for-profit activities; accuracy-related penalty; hobby losses; equestrian activities.
Scott A. Blum et ux. T.C. Memo. 2012-16 Sec. 6662; accuracy-related penalty; gross valuation misstatement; capital losses; lack of economic substance.
Bausch & Lomb Inc. et al. T.C. Memo. 2012-15 Sec. 6225; 7481; partnership assessments; Tax Court decision finality; lack of jurisdiction; notice of deficiency invalid.
Raymond Vandegrift et ux. T.C. Memo. 2012-14 Sec. 469; 6662; passive loss limitations; accuracy-related penalty; real estate professional; proceeds of sales netted against losses from passive activities; overstated basis in real estate.
John K. Goyak et ux. et al. T.C. Memo. 2012-13 Sec. 162; 419A; 6651; 6662; business expenses; qualified asset account limits; failure to file or pay; accuracy-related penalty; contribution to welfare benefit fund constructive dividend.
Darrell L. Titsworth T.C. Memo. 2012-12 Sec. 6330; 7122; hearing before levy; compromises; offer-in-compromise; incomplete financial information provided; sufficient assets to pay liabilities.
Farzana Zaher et al. T.C. Memo. 2012-11 Sec. 6015; innocent spouse relief; conduct by husband; financial restraining order.
Yulia Feder T.C. Memo. 2012-10 Sec. 72; 6201; 7491; annuities; assessment authority; burden of proof; cancellation of insurance policy; constructive distribution.
Girish C. Patel T.C. Memo. 2012-9 Sec. 162; 274; business expenses; business expense substantiation; documentation; recordkeeping.
Marshall Cohan et ux. et al. T.C. Memo. 2012-8 Sec. 170; 212; 761; 1001; 1222; 6662; charitable deduction; expenses of producing income; partnership definitions; gain or loss; capital gain definitions; accuracy-related penalty; sale of rights of first refusal to charity; gift letter and good faith estimate of consideration.
Estate of Raymond J. Gill et al. T.C. Memo. 2012-7 Sec. 2053; 2056; deductions for expenses of estate; marital deductions; substantiation of expenses; marital deduction and federal and state estate taxes.
Estate of Dwight T. Fujishima et al. T.C. Memo. 2012-6 Sec. 2043; 2055; deduction for expenses of estate; estate tax charitable deduction; promissory notes and life insurance includable in estate; substantiation of expenses.
Ashley M. Walker et al. T.C. Memo. 2012-5 Sec. 6651; 6662; failure to file or pay; accuracy-related penalty; LLC owned by children with 99 percent interest in dental practice; economic substance.
Michael S. Oros T.C. Memo. 2012-4 Sec. 162; 274; 6662; business expenses; business expense substantiation; accuracy-related penalty; trade or business of author; expenses related to a planned book; reliance on tax return preparer.
Javier L. Gaitan et al. T.C. Memo. 2012-3 Sec. 162; 6015; 6662; business expenses; innocent spouse relief; accuracy-related penalty; cost of goods sold deduction; travel expenses; substantiation; documentation.
Baacel Roumi T.C. Memo. 2012-2 Sec. 162; 274; 274; 6651; 6662; business expenses; travel or entertainment; business expense substantiation; failure to file or pay; accuracy-related penalty; documentation; recordkeeping.
Kayln M. Carpenter et al. T.C. Memo. 2012-1 Sec. 170; 503; charitable deductions; charities; conservation easements; perpetuity requirements.

Summary Opinions

Moe Mobasher T.C. Summary Opinion 2012-14 Sec. 162; 262; business expenses; living expenses; profit motive; not engaged in trade or business.
Samuel C. Johnson et ux. T.C. Summary Opinion 2012-13 Sec. 162; 6651; 6662; 6664; business expenses; failure to file or pay; accuracy-related penalty; penalty definitions and special rules; NOL carryforward disallowed; loan repayment not business expense; timely filing.
Andrea Ready T.C. Summary Opinion 2012-12 Sec. 901; 911; foreign tax credit; earned income exclusion; flight attendant; residence in France; dual citizenship U.K. and U.S.; amount earned in U.S. and international airspace.
Tao Xu T.C. Summary Opinion 2012-11 Sec. 219; 408; retirement savings; IRAs; IRA deduction disallowed; modified AGI above threshold; participation in retirement plan.
Kevin Allen Hudgins T.C. Summary Opinion 2012-10 Sec. 1; 2; 24; 32; 151; 152; individual income tax; head of household; child credit; earned income credit; personal exemptions; dependent defintion; unreported unemployment compensation; qualifying child; relationship to children.
Kangsheng Zhu et ux. T.C. Summary Opinion 2012-9 Sec. 219; 408; retirement savings; IRAs; deduction for contribution; active participant in qualified pension plan; AGI exceeding threshold.
Sherry A. Wickman et al. T.C. Summary Opinion 2012-8 Sec. 6015; innocent spouse relief; equitable relief; reason to know payments not made; economic hardship.
Douglas M. Gallant et ux. T.C. Summary Opinion 2012-7 Sec. 219; 401; retirement savings; pension plans; deductions to IRA disallowed; active participants in qualified plan.
Edwin Davila Jr. T.C. Summary Opinion 2012-6 Sec. 2; 24; 32; 151; 152; head of household; child credit; earned income credit; personal exemptions; dependent definition; children of cousin not qualifying relatives or children.
Clifton Gregory Brown et ux. T.C. Summary Opinion 2012-5 Sec. 61; 163; gross income definition; interest expenses; offset of interest on state tax under- and overpayments.
James Edwin Blackburn T.C. Summary Opinion 2012-4 Sec. 262; 274; 280F; 6330; living expenses; business expense substantiation; luxury autos and listed property; hearing before levy; collection due process; notice of deficiency not received; challenge of underlying tax liability.
George Edward Ham T.C. Summary Opinion 2012-3 Sec. 1; 61; 852; maximum rate on capital gains; gross income definition; regulated investment company; distributions from mutual funds includable in income; return of capital.
Thomas G. Henk Jr. T.C. Summary Opinion 2012-2 Sec. 61; gross income definition; severance pay as income.
Robert L. Hand et ux. T.C. Summary Opinion 2012-1 Sec. 162; 262; 6662; business expenses; living expenses; accuracy-related penalty; flying lessons not business related.

Copyright 2012 by A/N Group, Inc. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The information is not necessarily a complete summary of all materials on the subject.--ISSN 1089-1536

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--Last Update 02/18/12