Tax Court in Brief | DelPonte v. Commissioner | Innocent Spouse Relief and Authority of IRS Chief Counsel

Share this Article
Facebook Icon LinkedIn Icon Twitter Icon

Freeman Law is a tax, white-collar, and litigation boutique law firm. We offer unique and valued counsel, insight, and experience. Our firm is where clients turn when the stakes are high and the issues are complex.

The Tax Court in Brief – May 2nd – May 6th, 2022

Freeman Law’s “The Tax Court in Brief” covers every substantive Tax Court opinion, providing a weekly brief of its decisions in clear, concise prose.

For a link to our podcast covering the Tax Court in Brief, download here or check out other episodes of The Freeman Law Project.

Tax Litigation:  The Week of May 2nd, 2022, through May 6th, 2022

DelPonte v. Comm’r, 158 T.C. No. 7 | May 5, 2022 | Holmes, J. | Dkt. Nos. 1144-05, 1334-06, 20679-09, 20680-09, 20681-09

Short SummaryMichelle Goddard (now DelPonte) filed joint income tax returns with her then-husband, William Goddard, a tax attorney.  For several years, William filed the couple’s joint income tax returns and used aggressive tax-avoidance strategies.  The IRS examined the returns and issued notices of deficiency against William and Michelle.  William and Michelle timely filed petitions with the Tax Court contesting the deficiencies.  In her petition, Michelle asserted innocent spouse relief.

IRS Chief Counsel referred Michelle’s claim for innocent-spouse relief to the IRS’s Cincinnati Centralized Innocent Spouse Operation (CCISO) to help determine whether Michelle qualified for relief.  In the referral letter, IRS Chief Counsel requested CCISO not issue a determination letter but instead provide its analysis directly to IRS Chief Counsel.  CCISO later concluded that Michelle qualified for innocent spouse relief.  Although CCISO concluded that Michelle qualified for relief, IRS Chief Counsel disagreed and requested additional information from Michelle.  Michelle refused to provide it and made a motion with the Tax Court for an entry of decision.

Key Issue:  Whether IRS Chief Counsel can override CCISO’s administrative conclusion that a taxpayer is entitled to innocent spouse relief under I.R.C. § 6015.

Primary Holdings

Key Points of Law:

InsightAs shown in DelPonte, innocent spouse relief claims can be some of the more difficult claims in federal tax law.  To the extent that a taxpayer has a valid innocent spouse claim, careful consideration should be made as to the proper avenue to raise it.  In many cases, taxpayers may find it better strategically to raise the claim administratively as opposed to waiting to raise it as an affirmative defense in a Tax Court petition.  This strategy can potentially eliminate IRS Chief Counsel’s role in the innocent spouse determination.

Tax Court Litigation Attorneys

Need assistance litigating in the U.S. Tax Court? Freeman Law’s tax attorneys are experienced litigators with trial-tested litigation skills and in-depth substantive tax knowledge, having collectively litigated hundreds of cases before the U.S. Tax Court. Our tax controversy lawyers have extensive experience in Tax Court matters involving partnership audits and litigation under both the TEFRA and BBA regimes, international tax penalties, foreign trusts, valuation, reasonable compensation disputes, unreported income, fraud penalties, other tax penalties, and many other matters. We draw on our experience and wealth of tax knowledge to advise and guide clients through the entire tax controversy process, building the right strategy to resolve tax controversies from day one. Schedule a consultation or call (214) 984-3000 to discuss your Tax Court concerns or questions.