FindLaw Opinion Summaries - Tax Law

In re McKinney

Wed, 23 Jun 2010 20:00:05 PDT

(U.S. 7th Cir., Bankruptcy Law, Civil Procedure, Judgment Enforcement, Property Law & Real Estate, Tax Law) An appeal by a tax debt owner in Chapter 13 proceedings, arising from the bankruptcy court's denial of its objections to the debtor's proposed plan to pay off the tax debt with interest within five years, is dismissed for lack of jurisdiction as, although the issue that the tax debt owner cares about may have been resolved, its basic dispute with the bankruptcy estate has not been resolved and therefore the judgment of the bankruptcy court is not final.

In re: Delta Airlines, Inc.

Tue, 22 Jun 2010 20:00:05 PDT

(U.S. 2d Cir., Bankruptcy Law, Contracts, Tax Law) In creditors' appeal from a bankruptcy court's order upholding debtor's objections to their claims under tax indemnification agreements, the order is vacated where: 1) the bankruptcy court's construction of "pay" as that term was used in an agreement at issue nullified debtor's obligation to pay the "Owner Participant" under the agreement upon the occurrence most likely to call its provisions into play 150 the debtor's insolvency; and 2) the bankruptcy court effectively nullified the agreements by stripping them of their ability to protect the Owner Participant in the event of debtor's default.

US v. Batson

Mon, 21 Jun 2010 20:00:05 PDT

(U.S. 9th Cir., Criminal Law & Procedure, Sentencing, Tax Law, White Collar Crime) In a prosecution for conspiracy to commit tax fraud, defendant's restitution order is affirmed in part where the district court was authorized to order restitution for a violation of Title 26 as a condition of supervised release by 18 U.S.C. section 3563(b)(2), which granted courts broad discretion to order restitution as a condition of probation, and 18 U.S.C. section 3583(d), which made that grant applicable to supervised release. However, the order is vacated in part where restitution so ordered must be limited to the offense of conviction when, as here, that offense does not involve an element of a "scheme, conspiracy, or pattern of criminal activity."

Estate of Charania v. Shulman

Thu, 17 Jun 2010 20:00:02 PDT

(U.S. 1st Cir., Civil Procedure, Family Law, Probate, Trusts & Estates, Tax Law) In a tax deficiency case, the judgment of the tax court is affirmed in part and reversed in part where: 1) the tax court's judgment that all of the Citigroup shares were the separate property of the decedent for federal estate tax purposes and, thus, were includable in his gross taxable estate is affirmed, as the rule of De Nicols is that a change in marital domicile does not, in itself, effect a change in the marital property regime governing the spouses' rights in personal property acquired throughout the course of the marriage; but 2) the tax court's approbation of the late-filing penalty was in error and is therefore reversed.

Estate of Schneider v. Finmann

Thu, 17 Jun 2010 20:00:02 PDT

(N.Y., Injury And Tort Law, Probate, Trusts & Estates, Professional Malpractice, Tax Law) In a legal malpractice action alleging that defendants negligently advised decedent to transfer, or failed to advise decedent not to transfer, an insurance policy which resulted in an increased estate tax liability, the appellate division's affirmance of dismissal of the action is reversed where an attorney may be held liable for damages resulting from negligent representation in estate tax planning that causes enhanced estate tax liability.

In re: Gordon

Tue, 15 Jun 2010 20:00:01 PDT

(N.Y., Administrative Law, Tax Law) In tax review proceedings against the Town of Esopus, its Assessor, and its Board of Assessment Review to challenge the taxable assessed value of petitioners' land on the assessment rolls for the years 2002 through 2005, the appellate division's denial of the petition is reversed where forest land certified as such by the Department of Environmental Conservation under Real Property Tax Law section 480-a is used, for real property tax assessment purposes, as forest land and must be assessed based on that use.

Stobie Creek Inv. LLC. v. US

Fri, 11 Jun 2010 20:00:02 PDT

(U.S. Fed. Cir., Administrative Law, Corporation & Enterprise Law, Evidence, Government Law, Tax Law) In a tax refund suit involving the "Son of BOSS" tax shelter, Court of Federal Claims' decision upholding the Notices of Final Partnership Administrative Adjustment determinations and associated penalties is affirmed where: 1) the district court properly disregarded a series of transactions under the economic substance doctrine; 2) plaintiff was properly subject to accuracy-related penalties under 26 U.S.C. section 6662; 3) the reasonable-cause defense in 26 U.S.C. section 6664(c)(1) does not apply because it was not reasonable for plaintiff to rely on the advice of professionals in promoting and implementing the tax shelter; and 4) testimony of plaintiff's expert was properly excluded under Federal Rule of Evidence 702.

Lantz v. Comm'r of Internal Revenue

Tue, 8 Jun 2010 20:00:04 PDT

(U.S. 7th Cir., Family Law, Tax Law) Tax Court's judgment invalidating the two-year deadline that the Treasury has imposed on claims under section 6015(f), and thus reversing the IRS's denial of a taxpayer's application for innocent-spouse relief, is reversed as the fact that Congress designated a deadline in two provisions of the same statute and not in a third is not a compelling argument that Congress meant to preclude the Treasury Department from imposing a deadline applicable to cases governed by that third provision.

Strategic Hous. Fin. Corp. of Travis County v. US

Mon, 7 Jun 2010 20:00:04 PDT

(U.S. Fed. Cir., Administrative Law, Civil Procedure, Government Law, Tax Law) In plaintiff's suit against the U.S. to recover its arbitrage rebate, the order of the U.S. Court of Federal Claims (CFC) dismissing the suit for lack of jurisdiction under I.R.C. section 7422(a) is affirmed as section 7422(a) prohibits a court from asserting jurisdiction to hear a bond issuer's claim to recover an arbitrage rebate when the issuer failed to first seek an administrative refund from the IRS. However, the portion of the CFC's judgment regarding whether I.R.C. section 148(f)(3) grants the Secretary of the Treasury unfettered discretion to accelerate an arbitrage rebate is vacated as the court should not have conducted an APA analysis after recognizing that it lacked jurisdiction.

Nathel v. Comm'r. of Int'l. Rev.

Wed, 2 Jun 2010 20:00:05 PDT

(U.S. 2d Cir., Administrative Law, Tax Law) In an appeal from a decision by the tax court finding that capital contributions petitioners made to two S corporations could not be treated as "tax-exempt income" to the corporations for the purpose of increasing petitioners' bases in loans they made to the corporations, and that petitioners could not deduct their capital contributions as ordinary losses incurred in a trade or business pursuant to 26 U.S.C. section 165(c)(1) or incurred in a transaction entered into for profit pursuant to section 165(c)(2), the order is affirmed where: 1) petitioners' capital contributions did not constitute "tax-exempt income" to the S corporations and, therefore, petitioners were not entitled to increase their bases in their loans; and 2) because the petitioners did not meet their burden of showing that the primary purpose of their capital contributions was to obtain releases from their loan guarantees, the petitioners are not entitled to deductions from ordinary income pursuant to section 165(c)(2).

Levin v. Commerce Energy, Inc.

Tue, 1 Jun 2010 20:00:02 PDT

(U.S.S.C., Civil Procedure, Constitutional Law, Oil & Gas Law, Tax Law) In an action by independent natural gas marketers (IMs) who offered to sell natural gas to Ohio consumers against the Ohio Tax Commissioner (Commissioner), alleging discriminatory taxation of IMs and their patrons in violation of the Commerce and Equal Protection Clauses, the Sixth Circuit's reversal of the district court's dismissal of the action is reversed where, under the comity doctrine, a taxpayer's complaint of allegedly discriminatory state taxation, even when framed as a request to increase a competitor's tax burden, must proceed originally in state court.

US v. Kruse

Tue, 25 May 2010 20:00:02 PDT

(U.S. 7th Cir., Criminal Law & Procedure, Evidence, Tax Law, White Collar Crime) Conviction of defendant for conspiracy to defraud the United States and for filing false income tax returns is affirmed as the evidence at trial was sufficient to find defendant guilty of the charged offenses beyond a reasonable doubt

Glendale Redevelopment Agency v. County of Los Angeles

Tue, 25 May 2010 20:00:02 PDT

(Cal. App., Administrative Law, Government Law, Property Law & Real Estate, Tax Law) In a petition for writ of mandate by community redevelopment agencies seeking an order that county accept their revised Statement of Indebtedness (SOI) and pay additional sums for the year in question, trial court's denial of the petition is reversed as nothing in section 33675 prohibits a redevelopment agency from correcting errors in an SOI by filing a revised document.

Worldwide Equip., Inc. v. US

Mon, 17 May 2010 20:00:01 PDT

(U.S. 6th Cir., Government Law, Tax Law, Transportation) In plaintiff's suit for a refund of $119,302 in heavy-truck excise taxes it paid the IRS for the first quarter of 2004, related to the sale of certain models of coal-hauler dump trucks, grant of defendant-government's motion for summary judgment on plaintiff's claim and on its counterclaim of $1,149,140 in excise taxes claimed to be due for the period from 1999 to early 2003 is vacated and remanded as the government was not entitled to summary judgment on the basis of its argument that the truck model's primary function was dual use, as evidence submitted by plaintiff supports that, by design, the model's primary function is to haul coal off-highway.

Interworks Sys. Inc. v. Merchant Fin. Corp.

Fri, 14 May 2010 20:00:01 PDT

(U.S. 2d Cir., Civil Procedure, Commercial Law, Debt Collection, Government Law, Labor & Employment Law, Tax Law) In a complaint-in-intervention by the U.S. seeking unpaid employment taxes from defendant, under New York Lien Law sections 70-79a (Article 3-A), dismissal of the complaint is affirmed where Article 3-A's requirement that there be no prior pending Article 3-A action applied to the U.S. when it brought an action under Article 3-A, and the existence of a pending Article 3-A action required dismissal.