TAX COURT OPINION

Case: Linda M. Holladay & Dale B. Holladay
Docket Number: 31397-15
Judge: Goeke
Opinion Type: bench
Filed: 11/21/2016
Pages: 4

UNITED STATES TAX COURT WASHINGTON, DC 20217 LINDA M. HOLLADAY & DALE B. HOLLADAY, Petitioner(s), v. COMMISSIONER OF INTERNAL REVENUE, Respondent ) ) ) ) ) ) Docket No. 31397-15. ) ) ) ) ORDER Pursuant to Rule 152(b), Tax Court Rules of Practice and Procedure, it is ORDERED that the Clerk of the Court shall transmit herewith to petitioners and to respondent a copy of the pages of the transcript of the trial in the above case before Judge Joseph Robert Goeke at New Orleans, Louisiana on November 4, 2016, containing his oral findings of fact and opinion rendered at the trial session at which the case was heard. In accordance with the oral findings of fact and opinion, a decision will be entered for respondent. (Signed) Joseph Robert Goeke Judge Dated: Washington, D.C. November 21, 2016 SERVED NOV 2 2 2016 Capital Reporting Company 3 1 2 3 4 5 6 7 8 Bench Opinion by Judge Joseph Robert Goeke November 4, 2016 Linda M. Holladay & Dale B. Holladay v. Commissioner Docket No. 31397-15 The Court has decided to render Oral Findings of Fact and Opinion in this case and the following represents the Court's Oral Findings of Fact and Opinion. The Oral Findings of Fact and 9 Opinion shall not be relied upon as precedent in any 10 11 12 13 14 15 16 17 18 19 20 21 22 23 other case. This opinion is rendered pursuant to Internal Revenue Code Section 7459 (b) and Rule 152 of the Tax Court Rules of Practice and Procedure. Internal Revenue Code section references hereinafter are to the Internal Revenue Code in effect for the year 2013 and will be referred to simply by section number. This is a deficiency case upon which our jurisdiction is based upon Sections 6213(a) and 6214(a). The Internal Revenue Service issued a notice of deficiency to the Petitioners for 2013 and asserted an income tax deficiency of $21,165. The facts of the case are very simple and the parties stipulated the basic facts and the 24 Petitioner husband, Mr. Holladay, testified. Mrs. 25 Holladay was ill and was unable to appear at trial 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 but Mr. Holladay assured us her testimony would not have been necessary in any event. The case involved a decision Mr. Holladay made to fail to report a portion of the retirement distributions received by the Petitioners in 2013. At the time the petition was filed the Petitioners were resident of Louisiana. They received two distributions from the Teachers Retirement System of Louisiana in 2013. These distributions were reported on separate Forms 1099R. One of the distributions included federal income tax withholding. The second distribution of $11,520 did not have any income tax withheld. Mr. Holladay construed the Form 1040 in a fashion that he deemed it unnecessary to report the distribution that did not have any federal income tax 17 withheld from it. He admitted he had no technical 18 19 20 21 22 23 support for that argument and simply relied upon his interpretation of the Form 1040. We believe his interpretation was simply wrong and that while the 1040 instructions required the Form 1099R to be attached to the return to demonstrate the amount of tax withheld, that did not mean if no tax was 24 withheld that the distribution reported on the second 25 Form 1099R was not income. 866.488.DEPO www.CapitalReportingCompany.com Capital Reporting Company 5 It is well established that distributions such as those received by Mr. and Mrs. Holladay are income and need to be reported on federal income tax returns. Section 61(a)(11). At trial Mr. Holladay did not contest this. He simply argued that he thought he had discovered a loophole and that's why he did not include the second distribution on the income tax return. As we stated, his position was simply inaccurate and that leav6 us with no alternative but to uphold the deficiency as determined by Respondent in the amount of $2,165, and a decision will be rendered for the Respondent in this case. This concludes the Court's Oral Findings of Fact and Opinion in this case. (Whereupon, at 9:17 a.m., the above- entitled matter was concluded.) 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 866.488.DEPO www.CapitalReportingCompany.com