IRS AOD 2016-02

[Alan]

The IRA has acquiesced to the 9th Circuit decision in Voss vs
Commissioner that the mortgage interest deduction is by taxpayer, not by
residence.

Information is here at Paul Caron's blog: http://taxprof.typepad.com
/taxprof_blog/2016/08/irs-acquiesces-in-ninth-circuit-decision-giving-unmarried-couples-double-the-mortgage-interest-deduc.html
OR

http://goo.gl/XEZDWZ

9th Circuit decision reversing of Tax Court is here:
http://cdn.ca9.uscourts.gov/datastore/opinions/2015/08/07/12-73257.pdf

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[Stuart Bronstein]

Alan <temp...@vacationmail.com> wrote:

> The IRA has acquiesced to the 9th Circuit decision in Voss vs
> Commissioner that the mortgage interest deduction is by taxpayer,
> not by residence.

I'm surprised that the IRS took the position it did. On the $250,000
homeowner exclusion the IRS has ruled that is by taxpayer rather than
by residence. Why wouldn't they think this would be the same?

> Information is here at Paul Caron's blog:
> http://taxprof.typepad.com
> /taxprof_blog/2016/08/irs-acquiesces-in-ninth-circuit-decision-givi
> ng-unmarried-couples-double-the-mortgage-interest-deduc.html OR
>
> http://goo.gl/XEZDWZ
>
> 9th Circuit decision reversing of Tax Court is here:
> http://cdn.ca9.uscourts.gov/datastore/opinions/2015/08/07/12-73257.
> pdf
>



--

Stu
http://DownToEarthLawyer.com
https://www.etsy.com/shop/studiobethdesigns

[Alan]

On 8/2/16 10:23 AM, Stuart Bronstein wrote:
> Alan <temp...@vacationmail.com> wrote:
>
>> The IRA has acquiesced to the 9th Circuit decision in Voss vs
>> Commissioner that the mortgage interest deduction is by taxpayer,
>> not by residence.
>
> I'm surprised that the IRS took the position it did. On the $250,000
> homeowner exclusion the IRS has ruled that is by taxpayer rather than
> by residence. Why wouldn't they think this would be the same?
>
>> Information is here at Paul Caron's blog:
>> http://taxprof.typepad.com
>> /taxprof_blog/2016/08/irs-acquiesces-in-ninth-circuit-decision-givi
>> ng-unmarried-couples-double-the-mortgage-interest-deduc.html OR
>>
>> http://goo.gl/XEZDWZ
>>
>> 9th Circuit decision reversing of Tax Court is here:
>> http://cdn.ca9.uscourts.gov/datastore/opinions/2015/08/07/12-73257.
>> pdf
>>
>
>
>

All we know is that the IRS acquiesced. This means that they neither
agreed nor disagreed with the circuit courts reasoning used for its
decision. It does mean that they will follow the decision in cases that
have the same facts. In other words, the limitation on deducting
qualified mortgage interest should be applied on a per taxpayer basis
not a per residence basis. The statute is clear that married individuals
are limited to the same amount whether they file a joint return or
separate returns. Unmarried individuals who own the same home are
entitled to the same limit. The circuit court agrees that this creates a
marriage penalty and they said so what.

I think the most telling part of the circuit court decision is their
reasoning on the use of the parenthetical when it came to how married
taxpayers should be treated. If the limit applied per residence, why
would Congress have to create the parenthetical that said married
individuals filing separate returns only have half the limit!

[Taxed and Spent]

Perhaps that case is yet to be tried.

[Stuart Bronstein]

Alan <temp...@vacationmail.com> wrote:

> All we know is that the IRS acquiesced. This means that they
> neither agreed nor disagreed with the circuit courts reasoning
> used for its decision. It does mean that they will follow the
> decision in cases that have the same facts.

It means that they will follow the decision in the same circuit that
issued the ruling. They often take different positions in different
federal circuits, until several appeals courts all agree, or until
the Supreme Court steps in.

> I think the most telling part of the circuit court decision is
> their reasoning on the use of the parenthetical when it came to
> how married taxpayers should be treated. If the limit applied per
> residence, why would Congress have to create the parenthetical
> that said married individuals filing separate returns only have
> half the limit!

Yes, that is one of the (often overlooked) rules of statutory
construction.

In the $250,000 exemption situation, the rules of construction tend
to go the other way. Because in that situation the statute allows a
double exemption for a married couple. Why would they have needed to
do that if the exemption were to be applied on a per person basis
rather than a per residence basis?

On the other hand, the statute also gives the double deduction to
married couples where only one has satisfied the ownership
requirement, so it's not necessarily fatal to the "per person"
approach.

--
Stu
http://DownToEarthLawyer.com
https://www.etsy.com/shop/studiobethdesigns

[Alan]

On 8/2/16 3:23 PM, Stuart Bronstein wrote:
> Alan <temp...@vacationmail.com> wrote:
>
>> All we know is that the IRS acquiesced. This means that they
>> neither agreed nor disagreed with the circuit courts reasoning
>> used for its decision. It does mean that they will follow the
>> decision in cases that have the same facts.
>
> It means that they will follow the decision in the same circuit that
> issued the ruling. They often take different positions in different
> federal circuits, until several appeals courts all agree, or until
> the Supreme Court steps in.
>

You have it backwards Stuart. When they acquiesce to a Circuit Court
opinion they are agreeing to follow the decision in all circuits. When
they nonacquiesce to a Circuit Court opinion they are not agreeing to
follow the decision in the other circuits.

[clip]

[Stuart Bronstein]

Alan <temp...@vacationmail.com> wrote:

> You have it backwards Stuart. When they acquiesce to a Circuit
> Court opinion they are agreeing to follow the decision in all
> circuits. When they nonacquiesce to a Circuit Court opinion they
> are not agreeing to follow the decision in the other circuits.

OK, you're right. Sorry.

--
Stu
http://DownToEarthLawyer.com
https://www.etsy.com/shop/studiobethdesigns