Opinion
2784-19
02-08-2023
LORI MICHELLE PATITZ & ANDREW ROBERT MOODY, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Christian N. Weiler, Judge.
On September 27, 2022, this Court served our Opinion in this case, T.C. Memo. 2022-99, stating at the end thereof, "[d]ecision will be entered under Rule 155."Pursuant to Rule 155 the parties were required to file their agreed or unagreed computations within 90 days of service of our Opinion.
Unless otherwise indicated all Rule references are to the Tax Court Rules of Practice and Procedure. All dollar amounts are rounded to the nearest dollar.
On October 7, 2022, respondent filed his Computation for Entry of Decision (Computation). The Computation included a proposed decision document showing deficiency amounts of $4,177 and $13,930 for 2015 and 2016, respectively, and a penalty due for 2016 pursuant to section 6662(a) of $2,786.
Upon review, the Court notes potential discrepancies in respondent's Computation. For example, in our Opinion we sustained respondent's disallowance of Schedule C deductions petitioners claimed for 2015 and 2016. Specifically, for tax year 2015 we sustained respondent's disallowance of the deductions petitioners' claimed for office expenses of $3,345 and supplies expenses of $987. For tax year 2016 we sustained respondent's disallowance of deductions petitioners' claimed for office expenses of $1,679.
Accordingly, respondent's Computation included an allowance of the entire office expense of $3,345 and supplies expense of $596 for the 2015 tax year and office expense of $724 for the 2016 tax year. These allowances have impact petitioners' self-employment liability and the corresponding self-employment deductions, as well as accuracy-related penalties pursuant to section 6662(a). In total, these potential discrepancies appear to have a material effect on the calculation of the underlying deficiency amount.
On November 7, 2022, petitioners filed a Motion for Leave to File Computation for Entry of Decision seeking to file their computation pursuant to Rule 155. On November 10, 2022, we granted petitioners' Motion and ordered that on or before January 6, 2023, petitioners file their agreed or unagreed computation. On January 6, 2023, petitioners filed their Opposition to Computation for Entry of Decision (Opposition).
Petitioners failed to submit separately or include with their Opposition an alternate computation in compliance with Rule 155(b), which requires that petitioners submit "the amount believed by such party to be in accordance with the Court's findings and conclusions." Petitioners' Opposition did not state the amounts of the deficiencies for 2015 and 2016 and the penalty for 2016 that they contend is owed based on the Court's Opinion. Rather, petitioners' Opposition broadly objects to the format of respondent's Computation and some of respondent's calculations. Further, petitioners seek to improperly use their Opposition as an opportunity to relitigate issues previously decided by this Court in our Opinion.
Petitioners are reminded that Rule 155(c) provides:
Any argument under this Rule will be confined strictly to consideration of the correct computation of the amount to be included in the decision resulting from the findings and conclusions made by the Court, and no argument will be heard upon or consideration given to the issues or matters disposed of by the Court's findings and conclusions or to any new issues. This Rule is not to be regarded as affording an opportunity for retrial or reconsideration.
Upon due consideration, it is
ORDERED that on or before March 10, 2023, respondent shall file a supplement to his Computation explaining the potential discrepancies between his proposed computation and the Court's Opinion as outlined in this Order, and if necessary, include a revised computation. It is further
ORDERED that on or before April 10, 2023, petitioners may file a supplement to their Opposition, assuming they are still in opposition to respondent's supplemental calculations. Petitioners' supplement shall include: (1) a proposed decision document, (2) an identification of which of the line items in respondent's Computation, as supplemented, with which petitioners disagree, and (3) for those line items with which petitioners disagree, the amount of the line item that petitioners contend is correct.
Petitioners are advised that the Court may enter its decision in accordance with the submitted computation if the opposing party fails to file an objection or an alternative computation under Rule 155.