This case arose when petitioners filed for Chapter 12 bankruptcy and then sold their farm. Under Chapter 12 of the Bankruptcy Code, farmer debtors could treat certain claims owed to a governmental unit resulting from the disposition of farm assets as dischargeable, unsecured liabilities. 11 U.S.C. 1222(a). The Court held that federal income tax liability resulting from petitioners' post-petition farm sale was not "incurred by the estate" under 11 U.S.C. 503(b) of the Bankruptcy Code and thus was neither collectible nor dischargeable in the Chapter 12 plan. Therefore, the Court affirmed the judgment of the Ninth Circuit. View "Hall v. United States" on Justia Law

The Supreme Court granted certiorari in this matter to address the specific question of whether the requirement to post a pretrial bond set out in Mississippi Code Sections 27-77-5 and 27-77-7 (Rev. 2005) was procedural or jurisdictional. If procedural, it would constitute an intrusion by the Legislature into the assigned powers of this Court and of the judicial branch of government, and a violation of Article 6, Sections 144 and 146 of the Mississippi Constitution. Having considered the issue, the Court found that it's precedent was clear: the requirement of a pretrial bond relates to appellate jurisdiction and is within the powers of the Legislature. Accordingly, the Court affirmed the judgments of the Court of Appeals and of the Chancery Court for the First Judicial District of Hinds County. View "5K Farms, Inc. v. Miss. Dept. of Rev." on Justia Law

Federal tax assessments against husband arose out of his failure to file returns, report income, or pay tax, 1986 through 1993. Unpaid taxes, penalties, and interest totaled $901,052.17 as of January 2010. Wife paid $40,227.30 in full satisfaction of a separate assessment based on an audit of her 2000 return, resulting in dismissal of claims against her personally. The district court granted summary judgment to the government with respect to the assessment against husband and reduced the tax liability to judgment. The government moved for foreclosure of the lien and sale of the entire property. Since the property was held by the couple as tenants by the entirety, husband’s individual tax lien attached to his partial contingent survivorship interest in the property, which would have minimal value if sold separately. The court found that the property would bring $160,000 at a foreclosure sale and was subject to a mortgage of $14,572.36. Wife, age 60, testified to her limited income and sentimental attachment to the home where she had lived for 29 years. The court declined to force a sale (26 U.S.C. 7403). The Sixth Circuit reversed and remanded for reconsideration under the "Rodgers" factors. View "United States v. Winsper" on Justia Law

Appellee, AT&T Communications of Ohio, applied to the City of Cleveland for an income-tax refund for 1999 through 2002. Appellant, the City's income-tax administrator, denied AT&T's appeal in all respects, (1) dismissing AT&T's application for the refund for 1999 after finding that the statute of limitations on the request for a refund had expired, and (2) determining that any refund AT&T was claiming for 2000 through 2002 was offset in part by its other tax obligations. The board of income tax review reversed in part, determining that AT&T should receive the entire refund requested for the tax years 2000 through 2002. AT&T appealed. The court of common pleas reversed and entered judgment in favor of the administrator regarding AT&T's refund for 2000 through 2002. The court of appeals reversed the common pleas court's judgment, concluding that the court lacked jurisdiction to consider the administrator's assignments of error because the administrator did not file a notice of appeal. The Supreme Court affirmed, holding that because the administrator failed to perfect a separate appeal in the court of common pleas, the common pleas court lacked jurisdiction to consider the administrator's assignments of error. View "AT&T Commc'ns of Ohio, Inc. v. Lynch" on Justia Law

At age 56, plaintiff left his position as a partner in a law firm and enrolled in school. Employees who depart at age 55 or older may withdraw money from the employer's retirement plan. They must pay income tax, but a 10 percent additional tax imposed on most withdrawals before age 59½ does not apply to distributions "made to an employee after separation from service after attainment of age 55," 26 U.S.C. 72(t)(1), (2)(A)(v). Plaintiff moved the funds from the plan to an individual retirement account then withdrew about $240,000. A rollover is not taxable 26 U.S.C. 402(c). Plaintiff paid income tax. The IRS claimed he owed the 10 percent additional tax, plus a penalty for substantial underpayment of taxes. The Tax Court held that he owed the tax on money not used for tuition. The Seventh Circuit affirmed; the distribution was made to an IRA, not to the employee. Section 6662 excuses the taxpayer if there was substantial authority for the tax return's treatment, but there was no authority for plaintiff's position. View "Kim v. Comm'r of Internal Revenue" on Justia Law

"This matter has a complicated and convoluted procedural history, which has ultimately resulted in a 'cobweb of litigation.'" This case has its genesis in 1994 when ANR Pipeline Company (ANR) first challenged the ad valorem taxes assessed against its public service pipelines by filing a protest with the Louisiana Tax Commission (LTC). Thereafter, through 2003, ANR filed annual protests with the LTC. Tennessee Gas Pipeline Company (TGP) and Southern Natural Gas Company (SNG) also filed protests with the LTC regarding the ad valorem taxes assessed against their public service pipelines from 2000 to 2003.The issues before the Supreme Court concerned whether the reassessment of public service properties issued on remand of this matter in accordance with a court order constituted a local assessment by the local assessors or a central assessment by the Louisiana Tax Commission (LTC) and whether, in this taxpayers’ action, the assessors have a right to challenge a decision of the LTC relative to those reassessment valuations. Upon review, the Supreme Court concluded that the reassessments were central assessments governed by the provisions of La. Const. art. VII, sec. 18 and La. R.S. 47:1851, et seq. Furthermore, the Court found that once joined by the taxpayers as defendants in the taxpayers’ Section 1856 action for judicial review, the assessors are entitled to challenge the LTC’s final determination of the reassessment valuations. Accordingly, the Court found the lower courts erred in sustaining the taxpayers’ exceptions of no right of action and dismissing the assessors’ cross-appeals. View "ANR Pipeline Co v. Louisiana Tax Comm'n" on Justia Law

Defendant owned tobacco stores. Currency sales accounted for roughly half of the revenue. He directed employees to separate currency from credit-card and check receipts. He used currency to pay employees and suppliers and failed to report currency receipts on federal and state tax forms from 2002 to 2009. He channeled much of the currency (more than $60 million) to bank accounts in Lebanon, his homeland. He pleaded guilty to mail fraud, 18 U.S.C. 1341, and impeding administration of the Internal Revenue Code, 26 U.S.C. 7212(a). With an upward adjustment of 2 levels for using sophisticated means, U.S.S.G. 2B1.1(b)(10)(C), 2T1.1(b)(2), he was sentenced to 76 months. The Seventh Circuit affirmed. Although defendant did not create phony corporations, use fake names to open accounts, or employ technology to conceal assets, his conduct was sophisticated because he directed employees to separate currency receipts, he withheld funds from corporate bank accounts, and concealed the magnitude of his sales. He secreted money into foreign accounts by carrying currency and cashier’s checks during his travels, avoided reporting by depositing currency in multiple transactions (structuring or smurfing) 31 U.S.C. 5324; and washed money through the accounts of relatives and associates. View "United States v. Ghaddar" on Justia Law

The underlying cases here involved Randy and Helen Strodes' unsuccessful challenge to the valuation of certain property located in Saunders County. The court of appeals concluded that the Strodes' appeals were not timely filed and dismissed their appeals for lack of jurisdiction. The jurisdictional issued hinged on whether the Strodes' motions for rehearing filed before the Tax Equalization and Review Commission (TERC) were timely filed and therefore tolled the time during which the Strodes could thereafter petition the court of appeals to judicially review the TERC's actions. The Supreme Court reversed, holding that the motions were timely filed before the TERC, and therefore, the time to petition to the court of appeals was tolled, and the court had jurisdiction over the appeals. Remanded to the TERC with directions to consider the merits of the Strodes' motions for rehearing. View "Strode v. Saunders County Bd. of Equalization" on Justia Law

The National Association of Insurance Commissioners helps to coordinate the state-based regulations of insurance, creating model statutes and regulations and releasing actuarial guidelines. Actuarial Guideline 33 (1995), describing how insurance companies should handle accounting questions connected to annuities sold after 1980. The new guidance prompted plaintiff to change the way it calculated financial reserves for roughly 200,000 annuity contracts it had issued over the prior 15 years, increasing its reserves by approximately $59 million—about 1.2 percent. The company’s parent claimed a deduction for part of that increase on its federal taxes for the following year and sought to do the same for the next nine years, 26 U.S.C. 807(f) The IRS concluded that insurers could not use Guideline 33 in calculating reserves for annuity contracts issued before its effective date. The company paid the disputed taxes under protest and sought to recover $11 million in overpayments and several million more in interest. The district court concluded that Guideline 33 clarified the pre-1995 requirements rather than changing them, granting the company summary judgment. The Sixth Circuit affirmed. View "Am. Fin. Group & Consol. Subsidiaries v. United States" on Justia Law

This personal-property-tax case came to the Supreme Court for the second time on appeal from the Board of Tax Appeals (BTA). For tax year 2002, HealthSouth Corporation claimed that as a result of massive accounting fraud, it reported fictitious personal-property assets at its facilities in various Ohio taxing districts. HealthSouth subsequently filed an application for final assessment for 2002 in order to obtain from the tax commissioner a new assessment that would reduce the taxable value in various taxing districts by removing fictitious assets. The BTA reversed the commissioner's refusal to grant a reassessment, and the Supreme Court remanded with instructions for the BTA to complete its fact-finding. On remand, the BTA found that HealthSouth established that the denial of its refund request was improper and remanded to the commissioner for a determination of a reduced tax assessment. The Supreme Court affirmed, holding that the BTA acted reasonably and lawfully in its determination. View "HealthSouth Corp. v. Testa" on Justia Law