Opinion
17076-21
02-21-2023
J L MINERALS, LLC, BEASLEY TIMBER MANAGEMENT, LLC, TAX MATTERS PARTNER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Patrick J. Urda Judge.
This case is calendared for trial at the Court's special session in Atlanta, Georgia, beginning February 27, 2023. Petitioner, J L Minerals, LLC, Beasley Timber Management, LLC, Tax Matters Partner (JL Minerals), challenges a Notice of Final Partnership Administrative Adjustment that (1) disallowed a charitable contribution deduction with respect to JL Minerals' donation of a conservation easement and (2) determined penalties under sections 6662 and 6662A. [Doc. 1.]
Unless otherwise indicated, all statutory references are to the Internal Revenue Code, Title 26 U.S.C, in effect at all relevant times, and all Rule references are to the Tax Court Rules of Practice and Procedure. "Doc." references are to the docket record in Docket No. 17076-21, as numbered by the Clerk of this Court.
Before the Court are motions filed both by JL Minerals and the Commissioner to permit expert witnesses to testify without a written report regarding industry practice pursuant to Rule 143(g)(3). [Docs. 143, 226.] This Rule prohibits the testimony of experts without a written report where that testimony "is based on . . . detailed, technical information" but permits the Court discretion to allow such testimony in rebuttal to another expert or when testifying about, inter alia, industry practice. JL Minerals seeks to present expert testimony without a written report on industry practice relating to forestry, rural land practices, and borrow pits. The Commissioner requests permission to present such testimony as part of his case-in-chief or in rebuttal to expert opinion regarding the kaolin and mining industries.
We will deny both motions without prejudice. At this stage, we are unable to determine either the expertise of the witnesses or the relevance of the testimony that the parties seek to present. A decision whether any such testimony constitutes relevant expert testimony, much less whether it satisfies Rule 143(g)(3), thus is premature. The parties will be afforded ample opportunity at trial to establish the prerequisites for expert testimony without a written report as contemplated in Rule 143(g)(3).
Upon due consideration, it is
ORDERED that, JL Minerals' motion to permit expert witness to testify without a written report regarding industry practice pursuant to Rule 143(g)(3), [Doc. 143], filed on January 30, 2023, is denied without prejudice. It is further
ORDERED that, the Commissioner's motion to permit expert witness to testify without a written report regarding industry practice pursuant to Rule 143(g)(3), [Doc. 226], filed on February 9, 2023, is denied without prejudice.