Justia Tax Law Opinion Summaries

Guam’s Department of Revenue concluded that Guerrero owes approximately $3.7 million in unpaid taxes because he did not pay his full tax liability for the tax years 1999, 2000, 2001, and 2002 after belatedly filing his returns for these years. The parties dispute when the Department assessed Guerrero’s taxes because the official records are missing, likely due to water, mold, and termite damage at the storage facility. Guam filed tax liens on real property that Guerrero owns with his former spouse in joint tenancy, then filed suit to collect Guerrero’s tax deficiencies through foreclosure. Guerrero argued that the Department cannot prove that it timely assessed his taxes, timely levied the tax liens, nor timely commenced its action, 26 U.S.C. 6501(a), 6502(a)(1). Guam invoked the presumption of regularity based on the Department’s standard procedure and internal documents to establish that Guam acted within the statute of limitations.The district court partially ruled in favor of Guam, on the issues of the presumption of regularity and the timeliness of the Department’s actions. The Ninth Circuit affirmed. The presumption of regularity applied and Guerrero failed to rebut it. Guam established the timeliness of its assessment of Guerrero’s unpaid taxes, its filing of the tax lien, and its commencement of this action through the internal documents and testimony from the Department’s employees. View "Government of Guam v. Guerrero" on Justia Law

The Supreme Court remanded this property valuation matter for further proceedings, holding that the use of a now-defunct tax appeal form challenging assessments to certain homeowners' association lands for the years 2001, 2002 and 2003 was proper.Petitioners, homeowners' associations located in Marion County, filed petitions for correction of an error (Form 133) alleging that property tax assessments from the years 2001 through 2003 were illegal because certain common areas of the properties were so encumbered by restrictions that the land had no value. The Marion County Property Tax Assessment Board of Appeals denied the forms. The Tax Court affirmed in part and reversed in part, holding in part that the HOAs' claim was not proper for a Form 133. The Supreme Court reversed in part and summarily affirmed in part, holding that Form 133 was a proper avenue to challenge the application of a discount to common land within the HOAs' property. View "Muir Woods Section One Ass'n Inc. v. Marion County Assessor" on Justia Law

In 2011-2013, rather than retiring many older semi-tractors and purchasing all new replacements, Schneider bought 61 new tractors, and overhauled 982 existing tractors using new and refurbished parts packaged together in “glider kits.” Schneider’s older tractors were lighter and realized better fuel economy than newer models. Schneider’s tax advisors counseled that Schneider would have to pay the 12% excise tax (26 U.S.C. 4051) if it bought new tractors but a “safe harbor” (4052) permits companies to repair or modify tractors they already own, which have already been taxed. Each glider kit contained a cab, chassis, radiator, front axle, front suspension, front wheels, front tires, front brakes, brake system, and trailer connections; 912 were “powered glider kits” and included a remanufactured engine. The transmission, driveline, rear axle, rear suspension, and rear-wheel hubs—and sometimes the fuel tank, fifth wheel, and rear brakes, were generally reused.The IRS concluded that only six tractors qualified for the safe harbor. Schneider paid $9,387,403.73 plus interest, thensought a refund, which the IRS denied. The Seventh Circuit reversed. That Schneider elected to refurbish its tractors using powered glider kits does not disqualify those tractors from the safe harbor, which does not contemplate any measurement apart from this 75% test. The court remanded for a determination of whether the cost of Schneider’s refurbishments exceeded 75% of the “retail price of a comparable new article.” View "Schneider National Leasing Inc v. United States" on Justia Law

The Supreme Court affirmed the decision of the court of appeals affirmed the orders of the district court dismissing Appellant's constitutional claims asserting discrimination in the tax assessments of its properties, holding that Appellants' claims were time-barred.Appellant, Walmart, Inc., owned real property in two counties (the Counties). In this action, Walmart claimed that for tax purposes the Counties overvalued the properties or unfairly assessed the properties' value as compared with other similarly situated properties. Appellant asserted that the Counties' international discrimination in their tax assessments violated the Equal Protection Clause and Appellant's right to uniformity in taxation. The district court dismissed the claims as time-barred, and the court of appeals affirmed. The Supreme Court affirmed, holding that Appellant's claims were subject to the limitations period of Minn. Stat. Ann. Chapter 278 and were time-barred. View "Walmart Inc. v. Winona County" on Justia Law

The Eleventh Circuit affirmed the tax court's memorandum opinion upholding adjustments contained in five notices of deficiencies (NODs) issued by the IRS against petitioner for the tax years 1999, 2000, and 2001, as well as the tax court's adoption of the Commissioner's computations under Tax Court Rule 155 and its denial of several of petitioner's post-trial motions.In regard to jurisdiction issues, the court concluded that the Commissioner did not need to comply with the requirement of the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) that it issue Final Partnership Administrative Adjustment (FPAAs) to GG Capital to notify petitioner of adjustments to partnership items. The court explained that GG Capital's attempted TEFRA election on its 1997 return was not valid; GG Capital was required to attach a statement signed by all of its partners in order to elect into the TEFRA procedures under I.R.C. 6231(a)(1)(B)(ii); but GG Capital did not do so for either 2000 or 2001 and was therefore not subject to the TEFRA regime. The court also concluded that the tax court did not err in finding the 2004 NOD was timely mailed on October 15, 2004 adjustments; because the limitations period for making assessments against petitioner related to the converted items was suspended by virtue of the pendency of the AD Global case, the 2009 NOD was timely as to the 1999 tax year; and the court rejected petitioner's remaining jurisdictional claims.The court concluded that the tax court properly upheld the Commissioner's adjustments to the NODs. In this case, the court declined to look behind the 2009 NODs in assessing their validity; the tax court did not fail to impose the proper burden of proof and the tax court did not abuse its discretion in denying the motion to reopen the record to allow petitioner to introduce new evidence so late into the action; and there was no error in the tax court's post-trial rulings. View "Greenberg v. Commissioner of Internal Revenue" on Justia Law

The Supreme Court held that the direct funding provision of Proposition 208 did not fall within the constitutional definition of grants in Ariz. Const. art. IX, 21 (the Education Expenditure Clause) and was therefore unconstitutional to the extent it mandated expanding tax revenues in violation of the Education Expenditure Clause.Proposition 208 was a citizens' initiative passed in 2020 imposing an income tax purchase on high-income Arizona taxpayers to provide direct funding to schools. Petitioners brought this action challenging the constitutionality of the tax and the initiative's characterization of the direct funding as "grants" exempt from the Education Expenditure Clause and seeking to enjoin the collection of that tax pending the resolution of their challenge. The Supreme Court held (1) because Ariz. Rev. Stat. 15-1285 incorrectly characterizes the allocated monies in order to exempt Proposition 208 from the Education Expenditure Clause, it is facially unconstitutional; (2) the remaining non-revenue related provisions of Proposition 208 are not severable; (3) this Court declines to enjoin the imposition of the tax pending further proceedings; and (4) Proposition 208 does not violate the Tax Enactment Clause of the Arizona Constitution, and therefore, the bicameralism, presentment, and supermajority requirements found therein are inapplicable. View "Fann v. State" on Justia Law

Alameda County Waste Management Authority sought records from three out-of-county landfills (Waste Connections) that disposed of waste originating in Alameda County. The Integrated Waste Management Act, Public Resources Code sections 40000-49260, permits local government entities to inspect and copy specified records kept by landfills concerning waste received at such landfills originating in the government’s geographic jurisdiction “for the purposes of” verifying reports made by the landfills on “disposal tonnages by jurisdiction of origin” and “as necessary to enforce the collection of local fees.” Waste Connections refused to permit the inspections, contending that the Authority had not shown inspection of the records was “necessary” to enforce its fee ordinance. The Authority attached a copy of its fee ordinance and explained that the fee depends on where tonnage originated, the type and amount of waste, and the party responsible for transporting the waste to the landfill, facts that are documented in landfill weight tags of the kind the statute allows government entities to inspect.The superior court compelled Waste Connections to allow the inspection. The court of appeal affirmed. The “as necessary” language of section 41821.5(g)(2)'s inspection provision requires neither a factual showing nor a factual determination. View "Alameda County Waste Management Authority v. Waste Connections US, Inc." on Justia Law

Married since 1967, John and Frances Rogers filed joint federal income tax returns for many years. They underreported their tax obligations many times; the misreporting was the product of a fraudulent tax scheme designed by John, a Harvard‐trained tax attorney. The Seventh Circuit has affirmed the Tax Court’s rulings in favor of the IRS every time.Frances challenged two Tax Court decisions denying her “innocent spouse relief,” 26 U.S.C. 6015. The Seventh Circuit affirmed, having previously affirmed the denial of Frances’s request for innocent spouse relief for the 2004 tax year. The Tax Court took considerable care assessing Frances’s claims, denying them largely on the basis that she was aware of too many facts and too many warning signs during the relevant tax years to escape financial responsibility for the clear fraud perpetrated on the U.S. Treasury. The Tax Court applied the correct standard, with the possible exception of one factual error in its 2018 opinion regarding the couple’s lavish lifestyle but any error was harmless. Frances holds a master’s degree in biochemistry, a law degree, an M.B.A., and a doctorate in education. She assisted in managing her husband’s law firm while he sought treatment for alcoholism; she fired the office manager, maintained accounting records, endorsed and deposited checks, and paid expenses. View "Rogers v. Commissioner of Internal Revenue" on Justia Law

The Supreme Court affirmed the decision of the court of appeals ruling that an assessment that Mecklenburg County made of the business personal property owned by Harris Teeter, LLC at six grocery stores reflected the "true value" of that property, as required by N.C. Gen. Stat. 105-283, holding that none of Harris Teeter's challenges to the order of the North Carolina Property Tax Commission had merit.In rejecting Harris Teeter's challenge to the Commission's order, the court of appeals held that the Commission's findings had sufficient evidentiary support and that those findings had satisfied the County's obligation to prove that the methods it used in valuing Harris Teeter's property produced the true value of that property. The Supreme Court affirmed, holding that the manner in which the Commission resolved the issues in this case had ample record support. View "In re Harris Teeter, LLC" on Justia Law

The Supreme Court affirmed the decision of the Board of Tax Appeals (BOTA) upholding county appraisers' application of the Kansas Oil and Gas Appraisal Guide developed by the Kansas Department of Revenue's Property Valuation Division for valuations given for the 2016 tax year to the working interest of River Rock Energy Co. in 203 gas wells and related equipment, holding that the BOTA did not err.In its dispute, River Rock argued that the Guide produced inflated values for its working gas leases by capping operating expense allowances to arrived at a "working interest minimum lease value." The BOTA upheld the county appraisers' application of the Guide. The court of appeals affirmed in part and reversed in part, holding that the Guide overvalued River Rock's wells. The Supreme Court affirmed in part and reversed in part, holding (1) the county appraisers correctly applied the Guide; and (2) the court of appeals correctly decided that it had jurisdiction to entertain River Rock's challenge to BOTA's order refusing to abate filing fees. View "In re Tax Appeal of River Rock Energy Co." on Justia Law