Tax Court In Brief | Servance v. Comm'r | Tier 1 Railroad Retirement Benefits, Claim-of-Right Doctrine, Rescission Doctrine

• Published date: 14 December 2022
• Subject Matter: Employment and HR, Tax, Retirement, Superannuation & Pensions, Employee Benefits & Compensation, Income Tax, Tax Authorities
• Law Firm: Freeman Law
• Author: Freeman Law

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 November 21st, 2022, through November 25th, 2022

• Tillman-Kelly v. Comm'r, T.C. Memo 2022-111 | November 21, 2022 | Urda, J. | Dkt. No 6127-20

Servance v. Comm'r, T.C. Summary Opinion 2022-23 | November 21, 2022 |Copeland, J.| Dkt. No. 1587-18S (Tier 1 Railroad Retirement Benefits; Claim-of-Right Doctrine; Rescission Doctrine)

Summary: In 2012, Elijah Servance retired from the Metro-North Railroad. Mr. Servance applied for long-term disability benefits from the U.S. Railroad Retirement Board (RRB), and his application was granted in December 2012. During 2015 the RRB paid Mr. Servance tier 1 railroad retirement benefits and reported these benefits on Form SSA-1099, Social Security Benefit Statement, issued to Mr. Servance. The Servances (Elijah and Corliss) did not report the tier 1 railroad retirement benefits on their joint 2015 federal income tax return. Mr. Servance was eligible for benefits under a long-term disability insurance policy. Premiums were paid by Metro-North. The Servances did not report receipt of any Hartford Life Insurance (Hartford) long-term disability payments on their 2015 federal tax return. The IRS compared the Servances' 2015 federal income tax return to the third-party reports it received and, on the basis of these comparisons, issued a notice of deficiency to the Servances.

Key Issue: Whether the Servances' gross income includes unreported tier 1 railroad retirement benefits paid to Servance...