Opinion
12049-19
10-03-2023
POINT OF THE RIVER, LLC, PARKWAY SOUTH, LLC, TAX MATTERS PARTNER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Albert G. Lauber Judge
This case, which is part of a group of consolidated cases, is calendared for trial during a two-week special trial session beginning on August 19, 2024, in Atlanta, Georgia. The case involves a charitable contribution deduction claimed by Point of the River, LLC (POTR), for a conservation easement. The Internal Revenue Service (IRS or respondent) issued petitioner a notice of final partnership administrative adjustment (FPAA) disallowing POTR's deduction and determining penalties.
In December 2021 the parties filed cross-motions for partial summary judgment addressing the question whether the IRS complied with the supervisory approval requirement of section 6751(b)(1) by securing timely supervisory approval of the penalties determined in the FPAA[ That section provides that "[n]o penalty under this title shall be assessed unless the initial determination of such assessment is personally approved (in writing) by the immediate supervisor of the individual making such determination."
Unless otherwise indicated, all statutory references are to the Internal Revenue Code, Title 26 U.S.C., in effect at all relevant times, and Rule references are to the Tax Court Rules of Practice and Procedure.
By Order served March 25, 2022, we granted respondent's motion and denied petitioner's. We held that Revenue Agent (RA) Pamela Stafford secured supervisory approval on February 11, 2019, two months before the decision to assert penalties was formally communicated to POTR in the FPAA, and the supervisory approval was thus timely. In making this determination, we relied on a penalty lead sheet prepared by RA Stafford recommending the assertion of penalties. RA Stafford prepared and digitally signed that penalty lead sheet on November 1, 2018. It was signed by her immediate supervisor, Catherine Brooks, who indicated that the date of her signature was February 11, 2019.
On September 26, 2023, petitioner filed, at docket entry #94, a Motion for Reconsideration of our Order granting partial summary judgment for respondent. Petitioner relies on a recent memorandum opinion of this Court, Lakepoint Land II, LLC v. Commissioner, T.C. Memo. 2023-111. In Lakepoint the IRS admitted that RA Stafford and Ms. Brooks backdated a penalty lead sheet on which the Court had relied in a prior order, which had determined that RA Stafford had secured timely supervisory approval from Ms. Brooks. See id. at *7-8. Petitioner contends that "[t]he undisputed evidence in LakePoint now reveals that RA Stafford, as well as RA Brooks, participated in creating a backdated penalty lead sheet."
We will direct a response to petitioner's Motion for Reconsideration. In his response, respondent shall address any salient factual differences between the facts of this case and Lakepoint, including facts relating to electronic signatures and affixed timestamps that may be significant.
In consideration of the foregoing, it is
ORDERED that respondent shall file, on or before November 13, 2023, a response to petitioner's Motion for Reconsideration of Order, filed September 26, 2023, at docket entry #94.