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Tribe Must Pay Taxes on Gaming Money

Sally Jim, a member of the Miccosukee Tribe, had a good year at the casino.

She made $272,000 without ever playing a game. That was her per capita distribution as a member of the 400-member, Florida tribe.

There was one problem, however. In United States of America v. Jim, a federal appeals court said she should have paid her taxes.

The Hartsfield-Jackson Airport has been, and probably still is, charging planes that refuel there local taxes on the aviation fuel. And while that's legal, according to the FAA's interpretation of the rules, the tax money collected from local aviation fuel tax can only be used for aviation related purposes.

After attempting to reach a resolution with the FAA, the county filed a lawsuit seeking to invalidate the interpretation of the rule. Unfortunately for the county, the appellate court explained that the case was filed too late after the interpretation of the rule was announced, as well as too soon as the FAA had not issued a final action as to the local taxes.

Taxpayer's Affidavit Can Preclude Summary Judgment

A federal appeals court gave some good news to taxpayers, and to one taxpayer in particular.

Estelle Stein had been fighting the Internal Revenue Service over $220,000 in assessments, penalties and interest. She swore she paid her debt, but a judge didn't buy the affidavit and entered summary judgment for the government.

The U.S. Eleventh Circuit Court of Appeals, ruling en banc in United States of America v. Stein, sent the case back to a three-judge panel and overruled its own precedent. It's not about the weight of evidence; it's about disputed evidence.

11th Cir. Affirms Convictions Against 'Kingdom of Heaven' Tax Cheat

The Eleventh Circuit affirmed a lower federal district's conviction of Ronald Francis Croteau who was convicted of several tax crimes in 2015. It seems to be the end of the line as far as appeals go for the self-proclaimed "Ambassador to the Kingdom of Heaven."

Croteau plied his magic touch to filing ten fraudulent tax returns between 2008 and 2010 -- with claimed refunds totaling more than $3.8 million.

11th Cir. SCOTUS Grants: Fish Shrinkage, Cell Tower, Railroad Tax

We could start with cell towers disguised as trees. Or railroad fuel tax. But no, the case we really want to talk about, and the first case out of the Eleventh Circuit that will be argued this year, is the "One fish, two fish, red fish, short fish" case, where a guy, who was debating the size of his red grouper, tossed the fish overboard and was prosecuted under a banking statute (Sarbanes-Oxley) for destroying the evidence.

Only then will the Court will get to the Monopine, and what a city must do to keep these man-made mockeries of nature out of their neighborhood. And after that? Whether Alabama can gouge rail carriers for a sales-and-use tax while exempting trucks and boats.

Miccosukee Tribe Can't Use Tribal Sovereign Immunity in IRS Case

Indian tribes are required by law to deduct and withhold income taxes from gambling revenues paid to Indian tribe members. They’re also subject to backup withholding and reporting requirements.

This week, the Eleventh Circuit Court of Appeals held that tribes cannot use tribal sovereign immunity to avoid a federal investigation into whether they complied with those tax obligations.

Of all the appeals, in all the circuits, in all the country, the Supreme Court chose theirs.

Perhaps that's because the Eleventh Circuit Court of Appeals was the only appellate court to strike the individual mandate last year.

Like-Kind Exchange Tax Issue, and Criminal Matter

Ocmulgee Fields, Inc. v. Comm'r of Int'l. Rev., No. 09-13395, involved a petition for review of the tax court's determination that the taxpayer's like-kind exchange that interposed an intermediary between itself and a related party was not entitled to nonrecognition treatment.  The court affirmed on the ground that the record adequately supported the tax court's finding that the taxpayer structured its transactions to avoid the purposes of 26 U.S.C. section 1031(f).

Equity Inv. Partners, LP v. Lenz, No. 09-11887

In an action to foreclose defendants' mortgage and to establish the priority of plaintiff's security interest over a federal tax lien, summary judgment for the IRS is vacated where plaintiff was not required to show that the parties contemplated future execution of a security agreement at the time the loans were issued.  Rather, to show past consideration, plaintiff needed to present evidence that the security agreement was executed for the purpose of repaying the loans.

Read Equity Inv. Partners, LP v. Lenz, No. 09-11887

Appellate Information

Filed February 1, 2010


Opinion by Judge Cox

Kurtz v. Comm'r. of Int'l. Rev., No. 08-15209

In a tax court petition challenging an IRS deficiency notice issued to petitioner based on improper deductions, the Tax Court's order denying the petition is affirmed where no federal law requires food or beverages to be provided to seamen aboard a fishing vessel.

Read Kurtz v. Comm'r. of Int'l. Rev., No. 08-15209

Appellate Information

Filed July 23, 2009


Opinion by Judge Quist