Justia Tax Law Opinion Summaries

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The case pertains to Ariel Jimenez, who owned and operated a tax preparation business in Bronx, New York. Between 2009 and 2015, Jimenez led a large-scale tax fraud and identity theft scheme, purchasing stolen identities of children to falsely claim them as dependents on clients' tax returns. Through this scheme, Jimenez obtained millions of dollars, which he laundered by structuring bank deposits, investing in real estate properties, and transferring the properties to his parents and limited liability companies. Following a jury trial, Jimenez was convicted of conspiracy to defraud the United States with respect to tax-return claims, conspiracy to commit wire fraud, aggravated identity theft, and money laundering.On appeal, Jimenez raised two issues. First, he claimed that the district court’s jury instruction regarding withdrawal from a conspiracy was erroneous. Second, he alleged that the evidence supporting his conspiracy convictions was insufficient. The United States Court of Appeals For the Second Circuit affirmed the conviction. The court held that the district court’s jury instruction on withdrawal from a conspiracy was a correct statement of the law and that the evidence supporting Jimenez's conspiracy convictions was sufficient. The court found that Jimenez had failed to effectively withdraw from the conspiracy as he continued to benefit from it. View "United States v. Jimenez" on Justia Law

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The case involves a dispute between developers of rent-restricted housing projects and the Lancaster County Board of Equalization. The Board sought permission from the Tax Equalization and Review Commission to use a different methodology than the statutorily provided income approach for assessing the value of the housing projects. The Board argued that the income approach did not result in actual value and sought to use a different, professionally accepted mass appraisal method. The developers appealed the Commission's decision to grant the Board's request.The Nebraska Supreme Court was asked to determine whether the Commission's decision was a "final decision" subject to appeal. The court concluded that the Commission's decision was not final because it did not approve a specific alternate methodology and did not determine the valuation of the properties. The court further reasoned that the decision could be rendered moot by future developments in the litigation, such as the Board's refusal to approve the County Assessor's proposed valuations. The court held that, because the developers' rights had not been substantially affected by the Commission's decision, it lacked appellate jurisdiction and dismissed the appeal. View "A & P II, LLC v. Lancaster Cty. Bd. of Equal." on Justia Law

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The Nebraska Supreme Court affirmed a decision holding Allen Crow, a corporate officer, personally liable for unpaid use taxes of his former corporation, Direct Media Marketing, Inc. The court determined that Crow failed to rebut the presumption of correctness of the amount of use taxes assessed against Direct Media. The court further found that Crow was a responsible officer of Direct Media and willfully failed to pay Direct Media's use taxes, making him personally liable for the tax deficiency.Despite the Department of Revenue's significant delay in pursuing proceedings against Direct Media and Crow, the court did not find compelling circumstances or demonstrated prejudice that would warrant equitable relief. The court held that the doctrine of laches, which bars a party from relief due to delay, could not be applied against the government in its efforts to enforce a public right or protect a public interest. The court concluded that the delay did not absolve Direct Media and Crow of their liability. Therefore, the court affirmed the district court's order upholding the order of the Tax Commissioner that held Crow personally liable for Direct Media's unpaid taxes. View "Crow v. Nebraska Dept. of Rev." on Justia Law

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The case in question involves an appeal by Joseph William Foley against the United States Tax Court's dismissal of his deficiency protest due to untimeliness. Foley filed a protest against a notice of deficiency issued by the Internal Revenue Service (IRS) for the 2014 and 2015 tax years, but his filing came 1,393 days after the 90-day deadline.Foley's petition was filed under small tax case procedures, which is a less formal process meant for cases where the deficiency amount is under $50,000. The IRS moved to dismiss Foley’s petition for redetermination due to its untimeliness. Foley then appealed to the United States Court of Appeals for the Second Circuit, arguing that the Tax Court's decision was made on jurisdictional grounds, not on merit, and therefore should not be impeded by the non-reviewability provision of the small tax case procedures.The Court of Appeals disagreed with Foley's argument. It held that the Tax Court's dismissal of his petition did constitute a "decision", as defined by the Internal Revenue Code. The Court of Appeals explained that a "decision" includes a dismissal for lack of jurisdiction, which was the case for Foley’s petition. Therefore, according to the language of the Internal Revenue Code, jurisdictional dismissals like Foley's are indeed unreviewable under small tax case procedures.The Court of Appeals also disagreed with Foley's alternative argument that his case never became a "small case" due to the Tax Court's jurisdictional dismissal, and thus falls outside of the non-reviewability provision. The court noted that Foley had initially requested small-case procedures, and despite the Commissioner’s motion to dismiss his petition as untimely, Foley never moved to rescind his small-case election. Hence, the Tax Court dismissed a case that was subject to small tax case procedures, and the Court of Appeals is without jurisdiction to review Foley's appeal. Consequently, the court granted the Commissioner's motion and dismissed Foley’s appeal. View "Foley v. Commissioner of Internal Revenue" on Justia Law

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The Nebraska Supreme Court ruled in a dispute involving property tax assessment after a real estate property was damaged by fire due to arson. The issue at the core of the case was whether a fire caused by arson could be considered a "calamity" under state law, thus entitling the property owner, Inland Insurance Company, to a reduction in their property's assessed value.The Tax Equalization and Review Commission (TERC) had upheld the decision of the Lancaster County Board of Equalization, maintaining the assessed value of the property without considering the damage caused by the fire as a calamity. The TERC interpreted the word "calamity" as referring only to natural events.On appeal, the Nebraska Supreme Court disagreed with TERC's interpretation of the term "calamity." The court held that the term, as used in state law, encompasses any disastrous event, not just natural disasters. The language of the law, the court reasoned, did not limit calamities to natural events. The court therefore reversed TERC's decision and remanded the case for further proceedings. The court did not consider the Board of Equalization's cross-appeal, which argued that certain tax statutes were unconstitutional, due to a procedural issue. View "Inland Ins. Co. v. Lancaster Cty. Bd. of Equal." on Justia Law

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The court examined a case involving a divorcing couple, Amy Sue Openshaw and Glen Romney Openshaw, who had a custom of regularly saving a portion of their income throughout their marriage. The husband contested the judge’s alimony decision, arguing that the judge should not have considered the couple's practice of saving as part of the marital lifestyle in setting the amount of alimony.The court held that where a couple has a customary practice of saving during the marriage, such saving can be considered as a component of the couple's marital lifestyle in determining alimony. Therefore, the judge did not err in considering the parties' regular savings practice in setting the alimony amount.The husband also disputed the division of liabilities, as the judge assigned the wife only $5,032 in liabilities, while the husband was assigned $343,280, primarily for the family's unpaid tax debt. The court found the division of liabilities to be erroneous as the judge did not explain why the tax debt, a significant marital liability, was assigned solely to the husband. The court ordered a remand to reevaluate the division of liabilities in the judgment. View "Openshaw v. Openshaw" on Justia Law

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The Supreme Court of the State of Washington heard a case involving Assurance Wireless USA LP, a telecommunications company that provides wireless services to low-income consumers as part of the federal "Lifeline" program. Assurance contested the Department of Revenue's tax assessments on the reimbursements they received for their services, arguing that the transactions were not retail sales. The Board of Tax Appeals (BTA) upheld the tax assessments, finding that the transactions did constitute retail sales and that the tax burden fell on the Universal Service Administrative Company (USAC), the nonprofit appointed by the Federal Communications Commission (FCC) to administer the Lifeline program.The Supreme Court agreed that the transactions were retail sales and that USAC, not the Lifeline consumers or the FCC, bore the legal incidence of the tax. However, the Court concluded that USAC operates as an instrumentality of the federal government, meaning that the retail sales tax violated the intergovernmental tax immunity doctrine as applied in this case. The Court ultimately reversed the decision of the Court of Appeals and remanded the case to the BTA for further proceedings in line with this opinion. View "Assurance Wireless USA, LP v. Dep't of Revenue" on Justia Law

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This case involved a group of businesses (referred to collectively as Taxpayers) who filed applications for adjustments to the fair market value of their properties for tax year 2020 in the state of Utah. They claimed that their properties' values had decreased due to "access interruption" caused by the COVID-19 pandemic and associated government guidelines, which they argued constituted a circumstance beyond their control under Utah Code section 59-2-1004.6 (the Access Interruption Statute).The Utah State Tax Commission rejected this argument, maintaining that the pandemic did not qualify as an "access interruption event" under the Access Interruption Statute. It reasoned that the statute applies only if access was interrupted due to any of thirteen enumerated events or due to a similar event as determined by the Commission via administrative rule. Because the pandemic neither fit into any of the enumerated categories nor was included in the Commission's administrative rules, the Commission ruled that the statute did not apply.The Supreme Court of the State of Utah agreed with the Commission's reasoning, holding that the Access Interruption Statute allows only the Commission to add to the statute’s list of qualifying circumstances if the Commission determines by rule that the additional event is similar to the events enumerated in the statute. Because the pandemic was not an enumerated event and had not been added by administrative rule, the Supreme Court upheld the Commission's decision. View "Miller Theatres v. Tax Commission" on Justia Law

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The Arkansas Supreme Court reversed and remanded a decision of the Phillips County Circuit Court, which had found in favor of Kit and Jole Wilson in their dispute with the Arkansas Department of Finance and Administration (ADFA). The Wilsons had restored a building in Arkansas and were granted a historic-rehabilitation income-tax credit. The ADFA applied this credit to the Wilsons' 2015 tax return before apportionment, reducing their tax liability. The Wilsons protested, asserting that their tax liability should have been zero after applying the credit. The circuit court ruled in the Wilsons' favor, determining that the ADFA must apply the credit after apportioning the Wilsons’ tax due and that certain state codes conflicted with each other.However, the Supreme Court found that the ADFA correctly applied the tax credit before apportionment, in line with state law. The court also held that the state codes did not conflict with each other. The court concluded that the circuit court erred in its statutory interpretation and reversed its decision. View "STATE OF ARKANSAS, DEPARTMENT OF FINANCE AND ADMINiSTRATION v. WILSON" on Justia Law

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This case involves a dispute over the taxation of cell phones sold in California as part of a "bundled transaction," in which a consumer purchases the phone at a reduced price from a wireless service provider in exchange for signing a contract for future wireless service. The plaintiffs challenged a state regulation that calculates sales tax on the full, unbundled price of the phone, rather than the discounted price paid by the consumer. They argued that this regulation violated the Revenue and Taxation Code and was not properly adopted under the Administrative Procedures Act.The Court of Appeal of the State of California, Third Appellate District, rejected these arguments. It concluded that the Department of Tax and Fee Administration could allocate a portion of the contract price in a bundled transaction to the cell phone and tax it accordingly. It also found that the regulation was properly adopted under the Administrative Procedures Act.The court noted that, while services are not taxable under California law, the sale of a cell phone as part of a bundled transaction is not a true discount because the wireless service provider recoups the cost of the phone through the service contract. Therefore, the Department could reasonably allocate a portion of the contract price to the phone and tax it accordingly. The court also concluded that the regulation had been properly adopted under the Administrative Procedures Act, rejecting the plaintiffs' arguments that the Department had failed to properly assess the regulation's economic impact and provide adequate notice to the public.As a result, the court reversed the portion of the lower court judgment that invalidated the regulation and prohibited the Department from applying it to bundled transactions. It remanded the case with instructions to deny the plaintiffs' petition for a writ of prohibition. View "Bekkerman v. California Department Of Tax and Fee Administration" on Justia Law