Supreme Court Agrees to Hear Penalty Issue in Woods

The Court this morning granted the government’s petition for certiorari in United States v. Woods, No. 12-562.  As we recently reported, the issue presented in the petition concerns the applicability of the valuation overstatement penalty — specifically, whether tax underpayments are “attributable to” overstatements of basis when the inflated basis claim has been disallowed based on a finding that the underlying transactions lacked economic substance.

The Court also added a second question for the parties to brief — “Whether the district court had jurisdiction in this case under 26 U.S.C. section 6226 to consider the substantial valuation misstatement … Read More

Taxpayer Seeks Supreme Court Review in Historic Boardwalk

[Note:  Miller & Chevalier filed an amicus brief in the Third Circuit in this case on behalf of National Trust for Historic Preservation]

We have previously reported extensively (see previous reports here) on the Third Circuit’s decision in Historic Boardwalk denying a claim for historic rehabilitation tax credits by the private partner in a public/private partnership that rehabilitated a historic property on the Atlantic City boardwalk.  Although the Third Circuit declined to rehear the case, the taxpayer has now filed a petition for certiorari seeking Supreme Court review (docketed as No. 12-901).

With no conflict in the circuits on … Read More

Rehearing Denied in Historic Boardwalk

The Third Circuit yesterday denied the taxpayer’s petition for rehearing en banc in Historic Boardwalk in what seems like record time (the petition was filed on October 10).  The taxpayer’s last hope is to seek Supreme Court review, though the case does not look like one that could pique the Court’s interest.  A petition for certiorari would be due on January 22.… Read More

Taxpayer Seeks Rehearing En Banc in Historic Boardwalk

The taxpayer has filed a petition for rehearing and rehearing en banc in Historic Boardwalk, asking the Third Circuit to reconsider its decision denying the taxpayer’s claim for historic rehabilitation credits.  Among other points, the petition criticizes the panel’s decision for analogizing this case to the Second Circuit’s Castle Harbour decision, TIFD III-E, Inc. v. United States, 459 F.3d 220 (2d Cir. 2006), which found that the partner there had no downside risk that it would not recover its capital contribution.  The taxpayer argues that there was a risk here that the partner would not recover its capital … Read More

Tax Court Reversed on Historic Rehabilitation Credits in Historic Boardwalk

[Note:  Miller & Chevalier filed a brief in this case on behalf of National Trust for Historic Preservation]

In a detailed 85-page opinion, the Third Circuit has reversed the Tax Court’s opinion that upheld a claim for historic rehabilitation tax credits by the private partner in a public/private partnership that rehabilitated a historic property on the Atlantic City boardwalk.  See our earlier report here.  The government had argued both that the transaction lacked economic substance and that the private partner, Pitney Bowes, was not a bona fide partner in the enterprise.  The Third Circuit agreed with the government’s second … Read More

Bush TEFRA Claims Whacked for the Final Time

Long-time readers of the blog may recall our coverage of the Federal Circuit’s stumbles through TEFRA in the Bush litigation, where a panel issued a surprising decision finding that a notice of deficiency was required to make what was previously understood as a mere TEFRA computational adjustment, but that the IRS’s failure to issue the notice was harmless error.  Both sides cried foul, and the en banc court overturned the panel’s decision.  The Supreme Court this morning today denied the taxpayers’ petition for certiorari, meaning that the case has reached the end of the line, which turns out to be … Read More

NPR Oral Argument

On December 7th, oral argument was held in the Fifth Circuit in the NPR case before Judges Dennis, Clement, and Owen.  You can find a detailed explanation of the issues here but in summary the questions involve whether, in the context of a Son of BOSS case: the gross valuation penalty applies when the basis producing transaction is not invalidated solely due to a bad valuation; whether other penalties apply; how the TEFRA jurisdictional rules function as to those penalties; and whether an FPAA issued after a non-TEFRA partnership no-change letter falls afoul of the no-second-FPAA rule. 

Although both parties … Read More

Briefing Completed and Oral Argument Set in Historic Boardwalk Case

[Note:  Miller and Chevalier represents amicus National Trust for Historic Preservation in this case]

The government has filed its reply brief in the Historic Boardwalk case in the Third Circuit.   (See our prior report and the other briefs here.)  The brief mostly goes over the same ground as the opening brief in seeking to deny section 47 historic rehabilitation credits to the private investor partner in the partnership that rehabilitated East Hall on the Atlantic City boardwalk.  It attempts to side-step the Ninth Circuit’s economic substance analysis in Sacks by arguing that the Third Circuit did not explicitly … Read More

Third Circuit Considering Historic Rehabilitation Tax Credits in Historic Boardwalk Case

[Note:  Miller and Chevalier represents amicus National Trust for Historic Preservation in this case]

We present here a guest post by our colleague David Blair who has considerable experience in this area and authored the amicus brief in this case on behalf of the National Trust for Historic Preservation.

The government has appealed to the Third Circuit its loss before the Tax Court in Historic Boardwalk Hall, LLC v. Comm’r, which involves a public/private partnership that earned historic rehabilitation tax credits under Code section 47.  The partnership rehabilitated East Hall, which is located on the boardwalk in Atlantic City.  … Read More

Update on GI Holdings

In our earlier discussion of the disguised sale cases, we noted that the federal district court in New Jersey had issued an unpublished opinion in the GI Holdings case that applied the disguised sale rule of 26 U.S.C. § 707(a)(2)(B) to undo a transaction.  We noted that there was not yet an appealable order in that case, but at some point an appeal to the Third Circuit was possible.  It now appears that the case has been settled and will be formally dismissed in the coming weeks.  Thus, there will be no appeal to the Third Circuit, and the Fourth … Read More

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