Free Motion for Leave to File - District Court of Federal Claims - federal

Case 1:05-cv-01189-CFL

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Filed 12/15/2006

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No. 05-1189 T (Judge Charles F. Lettow)

IN THE UNITED STATES COURT OF FEDERAL CLAIMS ____________ THOMAS H. McGANN and EVELYN G. McGANN, Plaintiffs, v.

THE UNITED STATES, Defendant. ______________ RESPONSE TO PLAINTIFFS' SUR-REPLY

EILEEN J. O'CONNOR Assistant Attorney General DAVID GUSTAFSON STEVEN I. FRAHM BART D. JEFFRESS Attorneys Justice Department (Tax) Court of Federal Claims Section P.O. Box 26, Ben Franklin Station Washington, D.C. 20044 (202)307-6496 (202)514-9440 (facsimile)

Case 1:05-cv-01189-CFL

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Page INDEX

Response to plaintiff's sur-reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 I. Contrary to plaintiffs' claim, section 6601(e)(1) includes tax motivated interest within the definition of a "computational adjustment" set forth in § 6231(a)(6) . . . . . . . . . . . . . 1 Plaintiffs' interpretation of a claim for erroneous computation of a computational adjustment makes the six month limitation period applicable to such a claim meaningless . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Plaintiffs distort our discussion of the commencement of the six month period, and the relevance of exhibits attached to our Reply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Plaintiffs' sole response to application of Res Judicata lacks merit . . . . . . . . . . . . . . . . 11 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

II.

III.

IV. V.

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Page CITATIONS

Cases: Barlow v. Commissioner, 301 F.3d 714 (6th Cir. 2002) . . . . . . . . . . . . . . . . . . . . . . . . 3, 14 Barlow v. Commissioner, T.C. Memo. 2000-339, 2000 WL 1649506 (U.S. Tax Ct. Nov. 3, 2000), aff'd Barlow v. Commissioner, 301 F.3d 714 (6th Cir. 2002) . . . . . . 13 Barton v. Commissioner, 97 T.C. 548 (1991) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Copeland v. Commissioner, 290 F.3d 326 (5th Cir. 2002) . . . . . . . . . . . . . . . . . . . . . . . . 14 Field v. United States, 381 F.3d 109 (2d Cir. 2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Hildebrand v. Commissioner, 28 F.3d 1024 (10th Cir. 1994) . . . . . . . . . . . . . . . . . . 11, 13 Hill v. Commissioner, 204 F.3d 1214 (9th Cir. 2000) . . . . . . . . . . . . . . . . . . . . . . . . 11, 13 Krause v. Commissioner, 99 T.C. 132 (1992) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11, 14 Olson v. United States, 172 F.3d 1311 (Fed. Cir. 1999) . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Prochorenko v. United States, 243 F.3d 1359 (Fed. Cir. 2001) . . . . . . . . . . . . . . . . . . . 12 River City Ranches #1 LTD. v. Commissioner, 401 F.3d 1136 (9th Cir. 2005) . . . . . . . . 12 United States v. Dalm, 494 U.S. 596 (1990) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Wachovia v. United States, 455 F.3d 1261 (11th Cir. 2006) . . . . . . . . . . . . . . . . . . . . . . . 6 White v. Commissioner, 95 T.C. 209 (1990) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

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Page Statutes: Internal Revenue Code (26 U.S.C.):1 § 183 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11-14 § 6211 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 § 6226 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 12 § 6230 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-7, 12 § 6231 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1, 4, 5, 11 § 6512 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 § 6601 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-4 § 6621 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2, 3, 12, 13 § 7422 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Tax Reform Act of 1984, Pub. L. No. 98-369, § 144(a), 98 Stat. 494 (1984) . . . . . . . . . . 3 Tax Reform Act of 1986, Pub. L. No. 99-514, § 1511(c)(1)(A), 100 Stat. 2085 (1986) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Miscellaneous: Treas. Reg. and Temp. Treas. Reg. (26 C.F.R): § 301.6231(a)(3)-1(b) (1986) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 § 301.6231(a)(3)-1(d) (1986) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 § 301.6231(a)(6)-1T(b) (1987) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 § 301.6621-2T, A-4(1) (1984) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

All statutory references to Title 26 of the United States Code are to the Internal Revenue Code of 1954 or 1986, as in effect for the taxable year at issue or as in effect otherwise with respect to the facts of the present cases. Internal Revenue Code sections are referenced throughout the brief as "§ [section]." -iii-

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