Opinion
14307-18L
03-09-2023
SCOTT ALLAN WEBBER, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
David Gustafson Judge
This case is set for trial at the Court Washington, D.C., session beginning May 8, 2023. Now before us is the parties' joint status report (Doc. 72), which "request[s] a conference call to discuss the scope of issues before the Court in this case." We will grant their request.
To make that call productive, we will give here a preliminary response to their comments in the joint status report. We appreciate the parties' helpful presentation of their competing views of the issues in this case and the case law that applies to them. Generally speaking, we think the Commissioner's view is more nearly correct, though we would articulate the issues somewhat differently, as follows:
Giving a broad reading to Hershal Weber v. Commissioner, 138 T.C. 348 (2012), and Schwartz v. Commissioner, T.C. Memo. 2022-125, petitioner here might defeat the proposed levy by showing that the 2013 liability should be deemed satisfied by a credit--either (1) by showing an unbroken cascade of credit elects from 2003, or (2) by showing that, even if such an unbroken cascade did not occur, the IRS in fact allowed the 2005 claimed overpayment but has never credited it to petitioner's benefit, leaving it as an "available credit". We now comment briefly on each of these two potential arguments.
1. Credit elect cascade. The parties have seen the Court's imperfect attempt to reconstruct the cascading credit elects in our order of May 14, 2020 (Doc. 28 at 2-3). In the summary judgment context, on petitioner's say-so we "assume[d] that each return claimed the credit elect from the asserted overpayment in the prior year and requested its application to the succeeding year"; but on our understanding of the record at that time, we could not tell whether returns claiming credit elects were actually made for some years (at least 2006, 2009, and 2011). Moreover, some or all of the returns were apparently filed untimely, and so far we cannot tell whether some of the returns were so untimely that overpayments claimed thereon would be barred by section 6511(b)(1) ("No credit . . . shall be allowed or made after the expiration of the period . . . unless a claim for credit or refund is filed by the taxpayer within such period"), presumably defeating any claim of credit elect. The parties should assemble and stipulate--and should supplement and improve on--the information in our previous order (Doc. 28 at 2-3). If the Commissioner has transcripts for those years that clarify what petitioner filed and when, then those transcripts should presumably be included in the parties' stipulation. We think Schwartz offers support for the legal validity of this contention, but it depends on showing that, as a matter of fact, there was an unbroken cascade of credit elects from 2003 (or 2005) through 2013.
2. Allowed 2005 overpayment. As we currently understand petitioner's contention, it is: that an overpayment was allowed as to 2005; but that the resulting credit has never been applied to any liability of petitioner's; that the credit therefore remains an "available credit" that should have been credited to satisfy the 2013 liability that the IRS now proposes to collect; and that such an "available credit" would be available even apart from the existence of cascading credit elects. We think this contention is potentially valid as a matter of law, but it depends on showing that, as a matter of fact, the credit was allowed.
Petitioner should bear in mind that, if he intends to maintain either of these contentions, then he will have the burden to prove the facts. (If he determines that such proof is lacking for either of these contentions, then he should reconsider making that contention.)
In any event, we believe that the Commissioner is correct that we do not have jurisdiction to determine any overpayment, even for the 2013 year that is properly before us, Greene-Thapedi v. Commissioner, 126 T.C. 1 (2006), much less for any other year. As to 2013, we will decide only whether the liability has been satisfied.
It is
ORDERED that the Chambers Administrator of the judge signing this order shall contact the parties to set up a conference call, to take place no later than March 21, 2023.