Opinion
34318-21
01-06-2023
JOSEPH C. HONER, JR., Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Joseph Robert Goeke, Judge.
This case is before the Court on the parties' Cross-Motions for Summary Judgment. On August 11, 2022, petitioner filed a Motion for Summary Judgment, and on September 8, 2022, respondent filed an Opposition to petitioner's Motion. This case was called from the calendar at the Court's Tampa, Florida, Trial Session on October 17, 2022, for a hearing on petitioner's Motion. On November 22, 2022, respondent filed a Motion for Summary Judgment. Petitioner filed a Response to respondent's Motion on December 5, 2022.
Standard for Summary Judgment
The purpose of summary judgment is to expedite litigation and avoid unnecessary and time-consuming trials. Fla. Peach Corp. v. Commissioner, 90 T.C. 678, 681 (1988). The Court may grant summary judgment when there is no genuine dispute as to any material fact and a decision may be rendered as a matter of law. T.C. Rule 121(b); Sundstrand Corp. v. Commissioner, 98 T.C. 518, 520 (1992), affd, 17 F.3d 965 (7th Cir. 1994). In deciding whether to grant summary judgment, we construe factual materials and drawn inferences in the light most favorable to the nonmoving party. Sundstrand Corp., 98 T.C. at 520. However, the nonmoving party "may not rest upon the mere allegations or denials" of his pleadings but instead "must set forth specific facts showing that there is a genuine dispute" for trial. T.C. Rule 121(d); see Sundstrand Corp., 98 T.C. at 520.
Background
The following background is based on the parties' filings and is stated for purposes of ruling on the Cross-Motions for Summary Judgment. As explained further below, documentation has not been provided to establish certain facts set forth herein. Petitioner resided in Florida when he timely filed the Petition.
On October 18, 2021, respondent issued a Notice of Deficiency to petitioner for 2019 that determined he did not report taxable retirement income of $13,666 and had a deficiency of $5,302. The retirement income was reported on Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. Petitioner admits that he received the income and did not report it. He had not received the Form 1099-R when he filed his 2019 return. Respondent has not asserted any penalties.
Petitioner had an overpayment of tax shown on his 2019 return and indicated on his return that he elected to apply the overpayment to his 2020 tax liability. He also had overpayments shown on his 2020 and 2021 returns. The Notice of Deficiency also provides that Form 1099-R reported income tax withholding of $2,732, that petitioner also did not report on his return. The deficiency proposed in the Notice of Deficiency accounts for this additional withholding.
Discussion
In various filings with the Court, petitioner has agreed that he received the retirement income at issue and did not report it. Accordingly, respondent is entitled to summary adjudication that petitioner had unreported retirement of $13,666. However, he is not entitled to summary adjudication that petitioner has a deficiency of $5,302 as he has conceded that the $5,302 deficiency does not account for the withholding on the retirement income. A deficiency is defined as the correct tax minus the tax shown on the taxpayer's return, tax previously assessed, tax collected without an assessment, and rebates. I.R.C. § 6211(a); see Interlake Corp. v. Commissioner, 112 T.C. 103, 110 n.6 (1999). While we can summarily adjudicate the correct tax, the record before us does not establish that the amount of the deficiency is $5,302, or whether the $2,732 tax withheld on the retirement income has been assessed. Accordingly, we will grant respondent's Motion in part, that petitioner has unreported retirement income of $13,666.
Our jurisdiction encompasses the redetermination of deficiencies and the determination of overpayments. I.R.C. § 6412(a), § 6512(a). In his Motion, petitioner argues that he does not owe any additional amount because he had an overpayment for 2019 return that is sufficient to satisfy the increase in tax from the retirement income. He further states that the Internal Revenue Service (IRS) should reduce the amount of the 2019 overpayment applied toward 2020. For his argument, petitioner relies on an account transcript dated July 18, 2022, and the overpayment and other information shown on his 2019 return. Neither document is in the record to allow us to verify the amount of petitioner's 2019 overpayment or whether the IRS has applied all or part of it to 2020. Accordingly, we must deny petitioner's Motion.
Petitioner asserts that the account transcript supports his position that he does not have a balance due for 2019. However, the account transcript would not show the increase in tax from the retirement income because that amount cannot be assessed until after a final decision by this Court. Similarly, the transcript may not show the tax withheld on that income. Petitioner also asserts that the account transcript has other errors.
The Internal Revenue Code allows taxpayers to make an election on their tax returns to apply an overpayment shown on the return to their estimated income tax for the succeeding year. I.R.C. § 6402(b); Treas. Reg. § 301.6402-3(a)(5). It is possible that the IRS applied the 2019 overpayment to petitioner's 2020 tax before it discovered the unreported retirement distributions and issued the Notice of Deficiency in 2021, which means that the overpayment may no longer be available to satisfy the tax owed on the retirement distribution. There are not sufficient documents in the record for us to rule on the overpayment issue at this time. Accordingly, we must deny petitioner's Motion. We do not address whether petitioner has a balance owed for 2019.
Upon due consideration, it is
ORDERED that petitioner's Motion for Summary Judgment, filed August 11, 2022, is denied. It is further
ORDERED that respondent's Motion for Summary Judgment, filed November 22, 2022, is granted in part in that petitioner had unreported retirement income of $13,666 and is denied in all other respects. It is further
ORDERED that the parties are directed on or before February 28, 2023, to file with the Court joint or separate Rule 155 computations. It is further
ORDERED that this case is stricken for trial from the February 6, 2023, Tampa, Florida Trial Session.