ninety one dollars c shifted the burden of production and penalty cases tax penalty cases to the government it would get me if you would start in the united states the y which is binding precedent in which we because congress was concerned in penalty cases and it's laid out in our brief because of the taxpayer bill of rights that in a penalty case prior to nine hundred and ninety eight  government the i r s was assessing penalties without proper approval of to use as bargaining chips and so congress stepped in and said in the case of penalties irrespective of any other provision the internal revenue code the government's going to have the burden of production at trial and a refund it's also going to burn of production in any suit i guess and any any court in any land we can we can look at the language but what the unambiguous and says no penalty shall be assessed unless the initial determination of such assessment is personally approved in writing by the immediate supervisor of the individual making such determination or such higher level official as the secretary ma regulations penalties or determined at the partnership level is that true or not the that is partial well that is partially correct your honor the merit penalty addition tax or additional amount that relates to an adjustment to a partnership shall be determined as a partnership agreed or agreed your honor ok so if that's the case and here a penalty with both litigated and determined at the partnership litigation level then why was this defense about the failure to have the supervisory approval not supposed to have been individual partner to bend because it would seem that a partnership level defense which is one that applies to the entire partnership would apply to everybody that's a partner and not just your client true or not it was  this is one that doesn't only apply to your client and it applies to everyone in the partnership and therefore must be raised as a partnership no it's not correct the government has an obligation in the refund to part to have from where there is a ongoing litigation a refund to the government has the burden of production to establish that six thousand seven hundred and fifty one b one was does it have the burden at the park and ship level if the issue is right used are does it have the burden later if the issue is not raised a partnership level it makes the government the government it makes perfect sense to say that any issue that applies to the entire panel which is determined that the partnership level must be right it's a partnership what sense i mean suppose you had twenty parkins what sense does it make you  can have that raised twenty different times because it applies to every single part as opposed to one time because it applies to the partnership and covers all the parts i understand but my point is we don't have to r it at all it is not and is not part of the it's not part of the refund claim and it's not part it doesn't have to be raised at the partnership level it is a congress took that away congress said because of the situation we have with these penalties we want the government to come forward and make the proof at trial at the refund stage at trial but counsel once the partnership level of litigation is concluded and determination has been made and and this defense has not been raised or the government has not been brought to unburden because there was no one no one objected in any way then isn't the whole point that it doesn't have to be litigated again as a partner level and they were not being but it's not congress did not say that your honor notwithstanding clause comes into play where there is an administrative requirement before you ever get to a court proceeding because it's not the in because the protections that congress put in place irrespective of what happens at the partnership level at the partnership tag is we're not talking about a partnership level so the partnership levels over a refund claim has to be made by the individual to the commissioner the both the statute in the regulations require that that be done at all basis of the claim whether the taxpayer has the burden of interjecting that issue not produce not the burden of production of some evidence but the burden of raising are producing that issues and the  no the answer is no because congress congress took away that burden the idea here was to ensure that there was a there was always a burden prior to one thousand nine hundred and eight that the taxpayer had to come forward with proof that the penalty didn't apply well yes if the taxpayers remain silent does the block position is that the that the government would still have to meet its burden of production at the reef at the refund stage they would still have to put on evidence and if they don't satisfy the burden then you don't satisfy the burden and the protections that were there to make sure there was a valid legal assessment and place because we don't there is no assessment until you get there's no assessment to you get to part two until then till the notice of computational adjustments given to the taxpayer and his partnerships st participation in the son of boss tax shelter the administrative proceeding with respect to this penalty began a decade and a half ago there's no dispute that the penalty applies to the investors in the shelter that was decided in a previous tax court case and the only personal defense the taxpayer raised administratively that he had reasonable cause for understating his tax has been abandoned so all that's left is this argument that wasn't raised on the earlier it wasn't raised in the refund claim it wasn't even in the complaint tax payer waited until the very end of the case to argue that the i r s committed a procedural misstep at the very beginning  the district court awarded summary judgment to the government it was correct to do so i'd like to start maybe st by defending the court's decision in the united states p y and explaining why it is not in any way contrary we the government still has that presumption the government doesn't hasn't have the presumption as to the maybe maybe doesn't have the presumption as to the liability but he regulations of the secretary appliqu applicable regulations say that no refund will be allowed except upon one of more of the ground set forth in the claim for a refund but a claim for refund that does it didn't raise any challenge to the private facia case for a penalty it only raised a an affirmative defense on which it is undisputed that the taxpayer had the bird of production proof the nd reason why the district court's decision was correct is peculiar to partnership law does it is a partnership level the court has a pretty good grasp on it doesn't make any sense to have you know a one hundred different refund suits with differing results in terms of whether the approval was properly obtained when the approval occurs prior to the partnership proceeding curtis investment court investment decided just a couple of years ago is a partnership case i should also note that in that case the taxpayer failed to raise it in the partnership proceeding and tried to raise it on appeal and couldn't do so then so whatever burden of the government had it was too late at that point in time to raise it so it certainly would have been too and the reason why is that the approval has to be of the initial determination and the initial determination the initial assertion of the penalty must be included in the notice to all the partners that goes out at the beginning of the partnership proceeding otherwise the government can't turn or come around and assess the penalty later so it has to come in in that it has to be that notice that goes out to all the partners so the initial determination to put that assertion in the notice that the penalty applies it is a partnership level determination so fence is is the is the only defense and can be asserted in a partner level refund suit and the partner level defenses are limited to those that are personal to the partner or are dependent upon the partner and the regulations they are under it can't be determined at the individual partner level otherwise you will have inconsistent results among partners in a partnership and that is the whole thing is that unless the court has any other questions i'll just wrap up by saying look at it the taxpayer wants a refund on grounds of the i r s didn't comply with a supervisory approval requirement of six fifty one b the taxpayer needs to raise that issue in the refund claim mr ginsburg did not do that because the particular penalty in this case is based on partnership level determinations mr ginsburg was required to raise it at the partnership level he didn't do that and even in the cases he cites the the supervisory reproval requirement was an issue only because the tax payer places an issue if the tax payer because he was a party to a case against the government where he could raise the issue but didn't and because that case was finally decided way back in two thousand and thirteen he can't come in and we litigate the issue now his argument is foreclosed by various doctrine partnership tax that the st stage in the temple proceeding is provisional and that the penalty terminations requires a nd level secondly curtis investments w was just cited they happened to know the taxpayer happen to know that six thousand seven hundred and fifty one might not have been met after the completion of the partnership produce documents a document the signature on a piece of paper in dist and district court in a refund suit it's not a heavy burden and congress requires it to ensure because honor if this assessment was illegally assessed what the district court is ruling on is that although it's a legally assessed we are not going to determine whether or not the government satisfied a bird in the production improved it was legally assessed and congress wanted that protection to the taxpayers so if our position the variance does not apply where there's been a burden a production shift to the government and the government has an obligation to come forward mr ginsberg can at at the time that he filed as a forty three dollars even in to subpoena what's going to happen in trial two years later he doesn't have access to discovery he's not in litigation and as far as the partnership letter level with the geisha in the courts that the cases that we've cited are clear that that's a partnership level proceeding it is not an individual level proceeding and so earlier how did he discover it later in discovery and there in the refund suit here that the government doesn't put anything in because the government disagrees with you on whose burden it is and the government doesn't know that he is going to contest and do your position is it not true that the taxpayer hold on the bet issue and then when it looks like he's going to lose all well you know mcgovern well i don't think it's spring but he could raise that any time and he doesn't have to raise it because it's the burden of the government we see many cases in tax court where that has happened many the child brought it up after the completion of the trial after it was over and they were doing their post trial briefing he raises for the st time and the court said yes that's an obligation that the government has to come forward so that's just like here you can there because it's a burden on the government to come forward that is what the statute says and it's there to protect the taxpayer it's not to spring it on the government the government's in possession of the documents the governor's and possession who because they know the examining agent is they know who the supervisor is they know if there's written approval or not and they know if they validly assessed the penalty there's nothing sprung on the on on the i r s or the government here in fact they've been knew or that it couldn't have been right at the partner level correct and we see cases where taxpayers have found out but it's but if that's not the nature of discovery because can you what i would say is that if you're in a partnership proceeding and you're in litigation and the partnership says i want discovery i want to know if you properly assess this penalty the response from the government's going to be your it's too early we haven't assessed the penalty we don't assess it until step two so i can see the government saying we're not going to give you any information whether we assess or not because we may never assess it against your taxpayer it's a pretty it's a preliminary determine of merits at the partnership level it is not mr ginsburg still owed zero dollars there has not been an assessment and thirteen months later after deliberation the notice of computational adjustments were issued to mr ginsburg and for the st time  sixteen years there was an assessment and ms and and cording to the statute when you when mr ginsburg challenge this under the reasonable cause exception his defense that's his defense he was expecting him to go to court and see the government produce that piece of paper it is not an affirmative defense to have to refer to to be precious enough to know that the government didn't validly assess the penalty or would not meet its burden at trial and that's which i sense and the other tax court decisions where the judge steps in and says look you know nobody raised this but this is an absolute obligation said show me the approval of the supervisor the government would have told you to go down than i would say at the partnership level they would say that there has not been an assessment against mr ginsburg robinson are you keeping time yes he was answering questions from the court his time has already expired i believe it expired before the question but in any event counsel your time is expired we have the case and