Internal Revenue Bulletin:  2013-32 

August 5, 2013 

Actions Relating to Decisions of the Tax Court

Table of Contents

It is the policy of the Internal Revenue Service to announce at an early date whether it will follow the holdings in certain cases. An Action on Decision is the document making such an announcement. An Action on Decision will be issued at the discretion of the Service only on unappealed issues decided adverse to the government. Generally, an Action on Decision is issued where its guidance would be helpful to Service personnel working with the same or similar issues. Unlike a Treasury Regulation or a Revenue Ruling, an Action on Decision is not an affirmative statement of Service position. It is not intended to serve as public guidance and may not be cited as precedent.

Actions on Decisions shall be relied upon within the Service only as conclusions applying the law to the facts in the particular case at the time the Action on Decision was issued. Caution should be exercised in extending the recommendation of the Action on Decision to similar cases where the facts are different. Moreover, the recommendation in the Action on Decision may be superseded by new legislation, regulations, rulings, cases, or Actions on Decisions.

Prior to 1991, the Service published acquiescence or nonacquiescence only in certain regular Tax Court opinions. The Service has expanded its acquiescence program to include other civil tax cases where guidance is determined to be helpful. Accordingly, the Service now may acquiesce or nonacquiesce in the holdings of memorandum Tax Court opinions, as well as those of the United States District Courts, Claims Court, and Circuit Courts of Appeal. Regardless of the court deciding the case, the recommendation of any Action on Decision will be published in the Internal Revenue Bulletin.

The recommendation in every Action on Decision will be summarized as acquiescence, acquiescence in result only, or nonacquiescence. Both “acquiescence” and “acquiescence in result only” mean that the Service accepts the holding of the court in a case and that the Service will follow it in disposing of cases with the same controlling facts. However, “acquiescence” indicates neither approval nor disapproval of the reasons assigned by the court for its conclusions; whereas, “acquiescence in result only” indicates disagreement or concern with some or all of those reasons. “Nonacquiescence” signifies that, although no further review was sought, the Service does not agree with the holding of the court and, generally, will not follow the decision in disposing of cases involving other taxpayers. In reference to an opinion of a circuit court of appeals, a “nonacquiescence” indicates that the Service will not follow the holding on a nationwide basis. However, the Service will recognize the precedential impact of the opinion on cases arising within the venue of the deciding circuit.

The Commissioner ACQUIESCES in the following decision:

Karen Marie Wilson v. Commissioner [1]

705 F.3d 980 (9th Cir. 2013), aff’g T.C. Memo. 2010-134

The Commissioner does NOT ACQUIESCE in the following decision:

Media Space, Inc. v. Commissioner [2]

135 T.C. 424 (2010), vacated, 477 Fed. Appx. 857 (2nd Cir. 2012)

[1] Acquiescence relating to whether section 6015(e)(1)(A) provides a de novo standard and scope of review in section 6015(f) cases petitioned to the United States Tax Court.

[2] Nonacquiescence relating to whether the taxpayer’s forbearance payments to its preferred shareholders were (1) ordinary and necessary business expenses that were not required to be capitalized under section 263(a), (2) not nondeductible distributions to the shareholders under section 301, and (3) not pursuant to a reacquisition or an exchange of stock to which section 162(k) or section 361(c)(1) applied.

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