Case Summaries
(affirmance of Tax Court decision; discharge of credit card debt constituted discharge of indebtedness income and not a purchase price adjustment; I.R.C. Sec. 108(e)(5) applies only to direct agreements between purchaser and seller).
(case involves unmarried parents with joint custody of son and court holds that mother is custodial parent for tax purposes due to having physical custody of son for greater part of year even though son spent more waking hours with the father).
(debtors demonstrated establishment of homestead and had intent to return to the homestead; trustee failed to carry burden to show that debtors had permanently left the homestead and that they did not intend to return to it; court overruled trustee's objection to confirmation, trustee's objection to exemption of the homestead and motion to dismiss).
(amount of gift tax paid by recipients of deemed gifts of remainder interest in QTIP is included in decedent's gross estate via I.R.C. Sec. 2035(b); I.R.C. Sec. 2207A does not shift gift tax liability to QTIP recipients).
(IRS held to have abused its discretion when it proceeded with levy to collect taxpayer's unpaid tax; taxpayer established that levy would create economic hardship - taxpayer couldn't find employment due to terminal illness; while taxpayer not current in filing tax returns, Tax Court could not find any cases in which requirement that taxpayer be current with filing returns be applied to taxpayers that meet economic hardship criteria).
(statutory amendment does not make dog owners strictly liable for any and all damages caused by dogs; amendment only expands scope of statutory coverage to internal injuries and does not address playful and mischievous acts of dogs that cause injury).
(IRS reveals that it currently has 244 taxpayer under audit on the issue of donated conservation easements, 84 of which are in Colorado).
(expenses incurred for in vitro fertilization procedure not deductible medical expenses; expenses not related to treatment of medical condition).
(defendant issued zoning permit for installation of aerogenerator and plaintiff filed a land use appeal; court upheld trial court’s denial of appeal – court rejected plaintiff’s argument that public approval required before approval of zoning permit; aerogenerator was accessory use rather than a conditional use or special exception and was subordinate to principal use of the land as residential property and, as such, was similar to solar panels).
(plaintiffs were poultry growers that sued defendant for breach of contract and PSA violations and various state law claims; arbitration required under poultry grower contracts at issue in case – arbitration clauses were not unconscionable and were not fraudulently procured).
(thirteen writings that purportedly left certain items of decedent's property to specific individuals, but were not in testator's handwriting and had no self-proving affidavit not admissible to probate; executor failed to meet burden of proof that writings were codicils to decedent's will - use of word "for" insufficient to constitute word of grant or devise).
(question of fact raised as to whether defendant's seizure of plaintiff's pets was criminal action).
(petitioner, a partnership, can claim a charitable deduction for donation of land to state turnpike commission; land worth more than amount received and donative intent present; but, petitioner must make a pro rata apportionment of adjusted basis in land to the portion of transfer deemed to be a sale).
(purpose of PSA is to protect competition; thus, only those practices that will likely affect competition adversely violate the PSA; fact that another grower given contract on favorable terms not violative of PSA unless plaintiff establishes that competition adversely impacted).
(breach of contract case involving groundwater and soil testing; on motion for summary judgment, court ruled that issues of fact remain to be resolved at trial).
(sole owner of LLC personally liable for LLC's employment taxes; no election made to treat LLC as corporation and court noted that check-the-box regulations have previously been upheld as valid citing Medical Practice Solutions case).
(stock transferred to FLP not included in decedent's estate under I.R.C. Sec. 2036(c); bona fide sale present).
(securities trader did not make proper mark-to-market election under I.R.C. Sec. 475(f); election made after-the-fact more than one year late; substantial compliance argument rejected).
(petitioners (married couple) had income from indirect life insurance distributions; application of cash value against policy designed to eliminate one spouse's loan against policy value was not discharge of debt).
(debtor's patent infringement (saving patented soybean seeds) debt excepted from discharge under 11 U.S.C. Sec. 523(a)(6)).
(plaintiff, raisin grower, is a "handler" who "acquired" raisins and is, thus, subject to Ag Marketing Agreement Act of 1937 and the order regulating the "Handling of Raisins Produced from Raising Variety Grapes Grown in California"; penalties imposed by judicial officer did not violate the Excessive Fines Clause of the Eighth Amendment; Marketing Order's reserve requirement does not violate Due Process Clause of Fifth Amendment as a physical taking of plaintiff's private property without just compensation; judicial officer's decision to dismiss plaintiff's administrative petition not arbitrary, capricious, abuse of discretion or contrary to law; summary judgment granted to defendant).
("willful," as contained in the Kansas Consumer Protection Act, includes intent to harm the consumer; case involved tainted cattle feed).
(petitioner may claim casualty loss deduction for damage to vehicle incurred in traffic accident while driving under the influence of alcohol (loss claim filed with insurance company denied because blood alcohol level at time of accident over legal limit) negligence not bar to casualty loss deduction; no determination made as to whether accident caused by alcohol or weather conditions; penalties not imposed).
(landowner failed to meet burden of proof concerning value of condemned land).
(on various motions for summary judgment, court holds that Plant Protection Act and regulations thereunder do not allow for low level adventitious presence of regulated genetically modified rice in the commercial rice supply; North Carolina Unfair Trade Practices Act does not provide cause of action to plaintiffs that have no operations in the state; economic loss doctrine not applicable to plaintiffs' claims because claim does not involve any loss to property that was subject of a contract and property not alleged to be defective; no public nuisance for defendant's (Bayer) contamination of rice supply, but genuine dispute remains concerning whether defendant's use of its cooperators' land interfered with the plaintiffs' use of their land in terms of the type of rice that could be planted on the plaintiffs' land; no negligence per se based on APHIS regulations or state law; no affirmative defense of intervening cause - Bayer had duty to introduce GMO rice without contaminating non-GMO rice; damages to share-rent landlords also to be issue at trial; issue of punitive damages matter for trial; trial scheduled for January 2010).
(IRS recommends treating cooperative associations as C corporations for purposes of small partnership exception of I.R.C. Sec. 6231(a)(1)(B)).
(IRS recommends treating cooperative associations as C corporations for purposes of small partnership exception of I.R.C. Sec. 6231(a)(1)(B)).
(taxpayer's corn-based ethanol production plants qualify for I.R.C. Sec. 179C(a) election to expense 50 percent of cost basis of new plant property; ethyl alcohol vapor produced from corn at taxpayer's plants during dry mill process constitute gas produced from biomass).
(trial court improperly set aside decedent's 2002 will devising 88-acre farm; decedent had testamentary capacity based on evidence presented; evidence insufficient to support finding of undue influence - no abuse of confidential relationship).
(plaintiff claims that defendant (feedlot and farm) created nuisance by grinding hay in violation of county-issued conditional-use permit and that county's failure to enforce conditional-use permit constituted a taking; inverse condemnation claim fails as a matter of law because government did not physically conduct activity on plaintiff's property or regulate their property; no evidence existed that defendant in violation of conditional use permit; appropriate remedy would be mandamus action against county for failure to enforce conditional use permit and/or private nuisance action against defendant).
(plaintiff fed their alpacas feed that they purchased from defendant that was contaminated at defendant’s plant resulting in death of several of plaintiff’s alpacas; compensatory damages awarded, but lower court declined to submit issue of punitive damages to jury; appellate court held that malice could be shown – defendant’s employees knew of and disregarded contamination risk; plaintiff need not prove that defendant knew that feed was contaminated and intended to mislead plaintiff; thus, jury should have been instructed on damage mitigation issue).
(married couple does not qualify for first-time homebuyer credit with respect to home that was purchased for them by the wife's parents and for which the couple took title after November 6, 2009).
(valuation formulas contained in estate plan not void as contrary to public policy; "charitable lid" estate planning concept upheld - follows 8th Circuit's opinion in Christiansen).
(court upholds trial court’s order validating grant of zoning permit for construction of wind power station; plaintiff failed to carry burden of proof that amendments to zoning ordinance were unreasonable and bore no relationship to promoting public health, safety and welfare).
(zoning permit properly issued allowing construction of proposed wind power station; no deficiency in permit application and due process requirements satisfied).
(ownership of disputed area determined to have been acquired via a boundary by acquiescence).
(nurse may deduct education expenses incurred in obtaining MBA with a specialization in healthcare; degree of no value to nurse in qualifying her for a new trade or business).
(two companies planned to merge into a new company, the plaintiff; dissenters sought fair value for their shares; because one of the merging companies did not conduct business as a cooperative, price of shares not subject to dissenters' rights statute - which allows shares to be paid at less than fair market value).
(taxpayer did not have cancellation of debt income in 2006 as a result of foreclosure of taxpayer's home in 2000; IRS failed to meet burden of production under I.R.C. Sec. 6201(d) of showing that debt actually discharged in 2006).
("alley belting" (belting used in a mine on a conveyer to move minerals from underground to the surface) which is sold to cattle farmers who install the belting in cattle barns to provide a surface on which cow can walk that is less slippery, is exempt from sales tax because the belting equipment is used directly in livestock or dairy production).
(portion of plaintiffs' (married couple) property qualifies for farm use special assessment under state law; however, balance of property not eligible for special assessment because plaintiff did not use property for farming activities).
(defendants are beneficiaries of a lease allowing them to extract oil and gas from four wells on plaintiff's property; declaratory judgment entered finding that lease had expired by its terms when defendants failed to continue production; affirmative defenses of estoppel and unclean hands rejected by trial court and affirmed on appeal).
(taxpayers could not deduct rental real estate activity losses due to lack of evidence that either spouse qualified as a real estate professional; taxpayers' modified adjusted gross income exceeded the offset phaseout limit of I.R.C. Sec. 469(i)(3)(A)).
(defendant must reclassify 14 parcels as agricultural from vacant; property was leased to cattle company which grazed cattle on the parcels for two years as required by statute).
(plaintiff signed a release before skiing at defendant's resort which barred plaintiff's right to sue for injuries; plaintiff did suffer injuries upon skiing over the edge of an intermediate-level course; under state (MN) law, release is valid due to lack of disparity in bargaining power between the parties and release not violative of public policy).
(amounts paid to members of cooperative for their products qualify as per-unit retains paid in money and for purposes of computing cooperative's Sec. 199 deduction, cooperative's QPAI and taxable income are to be computed without regard to any deduction for such payments to members).
(I.R.C. Sec. 179 depreciation available in year that asset is placed in service defined as when property is in state of readiness for use in taxpayer's trade or business; IRS argument that property placed in service in earlier years rejected; taxpayer's arguments as to when property placed in service upheld).
(IRS lists factors affecting IRS's ability to collect after default of Chapter 11 reorganization plan; IRS notes that there are four post-BAPCPA aspects of bankruptcy cases that could limit the IRS's ability to collect from the debtor after default on the Chapter 11 plan - (1) discharge injunction (confirmation of the plan does not discharge debts until court grants discharge upon completion of all plan payments, but debtor may seek hardship discharge); (2) binding effect of the plan (upon default, plan generally not binding - IRS directed to try to have default provisions included in Chapter 11 plans); (3) stay of acts to collect pre-petition debts (stay terminated upon discharge or closing of the case); (4) stay of acts against estate property (does not end until property no longer in estate - IRS position is that, in the absence of binding precedent or contrary language included in the plan or confirmation order, bankruptcy estate after confirmation is limited to portion of debtor's income or other earnings necessary to fund the plan - if plan provides that all of debtor's property remains property of the estate, to be protected by the stay, IRS's only recourse may be to file a motion for relief from stay, or motion to convert or dismiss; memo notes that if IRS not bound by plan, the discharge or the stay, IRS could proceed with collection remedies against debtor to collect pre-petition debts).
(state statute requiring grape growers to fund generic advertising for promotion of grapes is government speech that is exempt from First Amendment challenge).
(plaintiff lacks standing to pursue its claim that chickens, turkeys and other domestic fowl are not excluded (contrary to USDA's position) from the humane slaughter provisions of the Humane Methods Slaughter Act of 1958).