Tax Court In Brief | Hatfield v. Commissioner | Frivolous Arguments

• Published date: 20 June 2022
• Subject Matter: Employment and HR, Tax, Employee Benefits & Compensation, Income Tax, Tax Authorities
• Law Firm: Freeman Law
• Author: Freeman Law

The Tax Court in Brief - June 13th - June 17th, 2022

Freeman Law's "The Tax Court in Brief" covers every substantive Tax Court opinion, providing a weekly brief of its decisions in clear, concise prose.

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Tax Litigation: The Week of June 13th, 2022, through June 17th, 2022

• Phillips v. Comm'r, T.C. Memo. 2022-58 | June 13, 2022 | Lauber, J. | Dkt. No. 18553-21L
• Romana v. Commissioner, T.C. Summary Opinion 2022-9 | June 16, 2022 | Carluzzo, J.| Dkt. No. 1156-21S
• Howland v. Commissioner, T.C. Memo 2022-60 | June 13, 2022 | Weiler, J.| Dkt. No 17526-19
• Chavis v. Comm'r, 158 T.C. No. 8 | June 15, 2022 | Lauber, J. | Dkt. No. 11835-20L
• Kellett v. Comm'r, T.C. Memo 2022-62 | June 14, 2022 | Greaves, J. | Dkt. No. 21518-18
• Walker v Commissioner T.C. Memo. 2022-63 | June 15, 2022 |Nega, J.| Dkt. No. 16958-18L

Hatfield v. Comm'r, T.C. Memo. 2022-59 | June 13, 2022 | Lauber, J. | Dkt. Nos. 7327-20, 1500-21

Opinion

Short Summary: Petitioners were a married couple filing joint federal income tax returns for tax years 2013 and 2014. Husband was employed as a radiologist. Petitioners failed to report husband's wages as gross income on their federal income tax returns for 2013 and 2014.

The Internal Revenue Service (IRS) examined petitioners' 2013 and 2014 returns and assessed federal income tax based on the wages reported on the Forms W-2, Wage and Tax Statement, that husband's employer had filed with the IRS for each of those years. In addition, the IRS found that petitioners were liable for additional tax for early withdrawals from an individual retirement account in 2013 and 2014 and that petitioners had failed to report taxable interest in 2014. The IRS also imposed accuracy-related penalties for both years and an addition to tax for petitioners' failure to timely file their 2014 return.

The IRS issued timely notices of deficiency for 2013 and 2014, and petitioners timely petitioned the Tax Court for redetermination. Petitioners' sole argument was that husbands' wages were not taxable income because "the United States Code [does not] actually make the 'wages' of American citizens subject to the Subtitle A federal personal income tax."

The IRS filed a motion for summary judgment for 2013 and a motion for partial summary judgment for 2014, conceding the accuracy-related penalty for this latter year. Petitioners responded to the motion for...