Review

No Longer Considered "Kiddie Court" [sic], US Tax Court Decides Big-Dollar Domestic and International Civil Tax Controversies

Prepared by Research Staff of Tax Law Institute

United States Tax Court no longer supports the moniker, "Kiddie Court."  A specialty court, the US Tax Court is devoted to hearing and deciding tax controversies between domestic and foreign citizens and the Internal Revenue Service. Such controversies arise when the IRS issues a notice of determination that a past due tax obligation to the United States Government exists.

Peruse on any day US. Tax Court Opinions that publish at the US. Tax Court website and you will realize that the decisions in these cases will render millions in future collections by the Internal Revenue Service and a bountiful of changes to the tax laws that included doing away with personal exemptions, Section 199, and 50% bonus depreciation. What will be done on this webpage is to write about a selected collection of Tax Court decisions for a period and reflect upon the author's purpose for referencing them as well as his/her perspectives. For example, Tony Nitti calls our attention to certain such rulings in his article published in Forbes, "Top Tax Cases of 2018: Where is Your Tax Home?" Paraphrased are ten 2018 US Tax Court decisions. We wish to point out that we have used Mr. Nitti's quotations as well to maintain his true meanings.  In his article, he cites not the most important decisions of each month of 2018 but the ones he believes "to be most useful to your humble workaday tax pro". 

Mr. Nitti's first case decided the first month of 2018 is Conner v. Commissioner, T.C. Memo 2018-6 that addresses "whether the sale of real estate generated ordinary income or capital gain". 

For February, Mr. Nitti tells us to check out Meruelo v. Commissioner, T.C. Memo 2018-16, in which he "discusses the many ways shareholders in an S corporation screw up trying to obtain 'debt basis'."

For March, Mr. Nitti selected Simonsen v. Commissioner, 150 T.C. 8, and "discovered that the tax treatment of short sales and foreclosures is anything but straightforward".

In April, he looked at Povolny Group Inc. v. Commissioner, T.C. Memo 2018-37. Mr. Nitti states that he "discovered that sometimes a loan isn't a loan".