Case: Rehearing Denied Where Penalty Approval Just Required Prior to Assessment (9th Cir.) (IRC §6751)

Petition for rehearing en banc denied in holding that the IRS only needs to get a supervisor’s approval of penalties before assessment or, if earlier, before the relevant supervisor loses approval discretion, the Ninth Circuit Court of Appeals held. Taxpayer failed to report its participation in a listed transaction in the filing of its corporate tax return. The IRS, in a 30-day letter, proposed an I.R.C. §6707A penalty for failure to disclose. Taxpayer objected to the finding, but the Appeals office upheld the penalty. Three months after the 30-day letter, the revenue agent’s immediate supervisor approved the penalty assertion. ...