IRS Chief Counsel Denies Basis Mitigation From Estate Tax Increase
In order for the mitigation provisions to apply, the first requirement is that there be a determination, as defined by IRC section 1313(a). The decision of the Tax Court in the estate tax (Form 706) case is what the estate is relying on as the determination. While this may appear to meet the definition of section 1313(a)(1), it is our position that it does not.
Because the value of the asset was determined through settlement negotiations that did not result in agreement on the merits, but instead resulted in a general agreement on the appropriateness of settlement in order to resolve the case, the mitigation provisions do not apply and the refund claim should be denied as untimely.
Wrong Attachment Kills Tax Court Jurisdiction
In order to determine whether Mr. Frausto maintains the capacity to represent the corporation under Rule 60(c), we must first apply the proper State law. The record, however, does not show in which State, if any, the corporation was organized. In fact, Mr. Frausto chose not to attend the hearing where he could have provided the relevant information. Thus, in the absence of any evidence to support our jurisdiction over the corporation, we hold that Mr. Frausto does not have the capacity under Rule 60(c) to litigate in this Court on behalf of the corporation.
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Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.