TiNY Report for November 16, 2017 (covering DTA cases issued November 9)

A Determination and an ALJ Order today.  Nothing from the Tribunal this week.  The Determination involves (sigh) an untimely request for Conciliation Conference.  The Order involves a petitioner’s request for costs.

The Determination

Matter of Crail; Judge: Connolly; Division’s Rep: Michelle Milavec; Taxpayer’s Rep: pro se; Article 22.  The Division was able to prove both its standard mailing practices and that they were followed when the Division mailed its Notice of Deficiency to the pro se Petitioner’s last known address on April 16, 2014.  Since Petitioner didn’t file her request for conciliation conference until more than two-and-a-half years later, it was late.  Of interest: this is the first time I recall seeing a determination from Judge Connolly.  I sat across the table from Judge Connolly when he and I were litigating Matter of Suburban Carting 20 or so years ago.  He probably remembers that case as a “win” for his client.  I remember it as a “draw.”  Regardless. . . welcome to the bench Judge Connolly!  We hope you will join our twelve (am I over-estimating?) other subscribers.

And since we struggle to find interesting stuff to say about these timeliness cases (and because it is a slow news day), this seems like a good time to roll out the TiNY Report’s first-ever reader contest!  The TiNY blog page on our website has a “Contact the TiNY Blog Team” link.  Go there and provide us with your “backronym” (look  it up; it’s a real word) for the acronym “pro se.”  The TiNY editing staff will pick the winner, judged based on humor and aptness, and publish it next week.  Let us know if we can disclose your name when we announce the one winner.  The one winner will receive a copy of the 2018 Guidebook to New York Taxes (Wolters Kluwer) signed by Contributing Editor, Mark Klein! The winning backronym needs to be better than what I came up with: “petitioner representing one’s self embittered.”  Void where prohibited.  If we get more than one of the same winning backronym, the one winner is the person who sent the winning backronym our email system says we received first.

The Order

Matter of March; Judge Bennett; Division’s Rep: Charles Fishbaum; Taxpayer’s Rep: Roger Gromet; Article 22. This is the continuing saga of poor Ms. March.  In this chapter, she tries to get back some of the legal fees and court costs she incurred to get a refund of fraud penalties.  Before turning to what happened here, let’s just re-cap by quoting from our last visit to this case in the TiNY Report for May 18, 2017:

Taxpayer involuntarily paid some penalties she did not think were owed. And she got some of them back. Here is the up-beat-ish summary to what is a tale of true woe. Taxpayer was a real estate professional. The evidence indicated her husband was a dominating and abusive functioning alcoholic. Taxpayer knew taxes were being filed late or not at all, but was unwilling to confront or escalate confrontations with her husband on the issue. Criminal tax fraud charges ensued. Ultimately both husband and wife pled to some lesser crime. There is some evidence that the criminal court judge intended that the fraud penalty should be paid only by husband. But he died. When Taxpayer sold her house, the Division claimed $15,000 or so of the proceeds to pay down what was left of the couple's penalties. Taxpayer filed a claim for a refund of the amounts applied to penalties. In partially reversing the ALJ’s determination sustaining the refund denial, the Tribunal found that the Division had not proven fraud, and that it alleged lesser penalties for certain years too late. But for the years lesser penalties had been timely asserted by the Division, petitioner owed them. So she’ll at least get some of her money back.

In the current chapter, Petitioner does not get any of her legal fees reimbursed for three reasons:

1.  Judge Bennett found that the Division’s position in the case (i.e. that Petitioner’s underpayment was due to fraud) was “substantially justified.”  The Judge acknowledged that she won her case; but at the time the Notice was issued, the Division knew that Petitioner copped a plea in a tax crimes case involving the same years and was guilty of a repeated pattern of non-filing, non-payment and late payments.  So, the Judge found that the Division’s position was substantially justified.

2.  The Petitioner failed to show that at the time the action was filed she: (a) had a net worth of less than $2 million, and (b) did not own a corporation with a net worth in excess of $7 million or with more than 500 employees.  The Petitioner submitted an affidavit that averred those facts in the present, but not in the past. And,

3.  Doesn’t it seem like petitioners never get fees awarded?

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