Cathryn A. Simmons
United States Tax Court · 2026-04-22
The case involved Cathryn A. Simmons challenging IRS deficiency determinations for her 2017 and 2019 tax years, plus an accuracy-related penalty under section 6662(a) for 2017. The disputed issues centered on business deductions claimed by Stuff, LC (a boutique she co-owned), expenses for two rental properties she owned, and the penalty. The Tax Court held that Simmons failed to substantiate the deductions in dispute and did not qualify for the reasonable cause exception to the penalty. The court reasoned that the taxpayer did not provide adequate records or evidence to support the claimed expenses, including interest, travel, and utility costs, and that her conclusory statements were insufficient to show reasonable cause.
taxesbusiness & regulatory
Kelby Daniel Reyes Barrios
United States Tax Court · 2026-04-16
The case involved Kelby Daniel Reyes Barrios challenging the IRS's determination of a $3,842 federal income tax deficiency for 2022, based on his failure to report $15,206 in nonemployee compensation from Antigua Floral & Styling, LLC. The Tax Court granted the Commissioner's motion for summary judgment, sustaining the deficiency determination. The court reasoned that the IRS's determinations are presumed correct, the taxpayer did not respond to the motion or provide any evidence to contest the unreported income, and failure to receive tax forms does not excuse the obligation to report income.
taxes
Jeffrey Pesarik
United States Tax Court · 2026-02-23
In this U.S. Tax Court case, Jeffrey Pesarik challenged a notice of deficiency for his 2020 tax year after failing to report gains from selling two properties—one in Wakefield, New Hampshire, for $187,000, and one in Hull, Massachusetts, for $556,800. Pesarik argued that renovation costs and closing expenses increased his basis in the Wakefield property and that the Hull property qualified for the section 121 exclusion as his principal residence. The court held that Pesarik could estimate allowable basis adjustments for the Wakefield property under the Cohan rule based on partial substantiation of expenses, but he failed to prove the Hull property met the two-year residency requirement for exclusion. It further upheld the accuracy-related penalty under section 6662, finding no reasonable cause for the underreporting given Pesarik's background in property management and lack of evidence that disabilities prevented compliance.
taxes
David S. Alioto
United States Tax Court · 2025-12-04
This case involved petitioner David S. Alioto challenging IRS deficiency determinations for his 2014 and 2015 tax years, along with additions to tax for 2015, based on allegations that he failed to report wage income, constructive dividends, and capital gains while improperly claiming business expense deductions on his personal returns. The Tax Court ruled in favor of the Commissioner, upholding the deficiencies and additions to tax. The court reasoned that Alioto's corporation, Probity Enterprises, Inc., was a separate taxable entity, so any business expenses and related deductions belonged to the corporation rather than Alioto personally; various stock transfers, payments from third parties, and unreported income were properly characterized as taxable to Alioto; and Alioto had abandoned his challenge to the additions to tax by not addressing them in his post-trial brief.
taxesbusiness & regulatory
Lake Jordan Holdings, LLC, Lake Jordan Partners, LLC, Tax Matters Partner
United States Tax Court · 2025-11-25
The case involved Lake Jordan Holdings, LLC, which claimed a $12,740,000 charitable contribution deduction on its 2017 tax return for donating a conservation easement over 157 acres of rural property in Alabama. The Tax Court found that Holdings met the basic requirements for a deduction under section 170 but determined that the claimed value was grossly overstated based on objective evidence of the property's recent purchase price, rural location, lack of utilities, and limited development potential. The court valued the easement at $1,091,760 and imposed a 40% gross valuation misstatement penalty under section 6662(h) because the reported amount exceeded the correct value by more than 1,000%. The decision rested on the absence of a reasonable cause defense for such penalties and the partnership's failure to substantiate the higher appraisal.
taxesenvironmentpropertybusiness & regulatory
Gary B. Nelson
United States Tax Court · 2025-11-13
This case involves petitioner Gary B. Nelson's challenge in the U.S. Tax Court to an IRS determination upholding a notice of intent to levy for unpaid federal income taxes from 2015 through 2019, which totaled over $186,000 after assessments, additions to tax, and interest. Nelson had requested a collection due process hearing and expressed interest in an installment agreement but did not provide his wife's required signature on the request form, submit a completed financial information form, or respond to multiple communications or attend the scheduled hearing. The court granted the Commissioner's motion for summary judgment, holding that the Appeals officer did not abuse discretion in sustaining the levy because Nelson failed to engage with the process or provide requested information, and there was no dispute over the underlying tax liabilities or the balancing of collection needs. The opinion notes that Nelson remains free to pursue collection alternatives directly with the IRS.
taxes