On Monday, December 6, the Tax Court announced the selection of two new Special Trial Judges (STJs). You can find the announcement here.
Special Trial Judges play a role in the Tax Court similar to the role of magistrates in the federal district court system. The position is described in IRC 7443A . The role was litigated all the way to the Supreme Court in Ballard v. Commissioner, 544 U.S. 40 (2005) when a regular Tax Court judge reversed the findings of the STJ without acknowledgment or explanation. That case provides insight into the position for those who may not be familiar with it.
In the 1980s when tax shelter cases and the partnership rules caused the Tax Court docket to swell to numbers three times its more recent annual numbers, there were 10 STJs. The reduction in cases over the years and retirements caused the number of STJs to fall significantly. The hiring of the two new STJs reflects a need to fill the somewhat depleted ranks. Prior to the appointment of the two new judges there were four STJs: Chief STJ Carluzzo; STJ Panuthos; STJ Guy (more on him below) and STJ Leyden. It is my understanding that STJ Guy plans to retire soon which would have left only three STJs had the court not made the new hires.
Unlike regular Tax Court judges who get to the bench after a Presidential appointment followed by a Senate confirmation hearing, the Chief Judge of the Tax Court itself hires the STJs. IRC 7443A provides in part:
(a) Appointment
The chief judge may, from time to time, appoint special trial judges who shall proceed under such rules and regulations as may be promulgated by the Tax Court.
(b) Proceedings which may be assigned to special trial judges. The chief judge may assign—
(1) any declaratory judgment proceeding,
(2) any proceeding under section 7463,
(3) any proceeding where neither the amount of the deficiency placed in dispute (within the meaning of section 7463) nor the amount of any claimed overpayment exceeds $50,000,
(4) any proceeding under section 6320 or 6330,
(5) any proceeding under section 7436(c),
(6) any proceeding under section 7623(b)(4), and
(7) any other proceeding which the chief judge may designate,
to be heard by the special trial judges of the court.
(c) Authority to make court decision
The court may authorize a special trial judge to make the decision of the court with respect to any proceeding described in paragraph (1), (2), (3), (4), (5), or (6) of subsection (b), subject to such conditions and review as the court may provide.
Because having a political connection does not play into the selection process, STJs usually come from a background of litigation in the Tax Court which allows them to hit the ground running. The newly selected STJs have that background although one comes more immediately from a non-litigation position.
New STJ Choi has previously run two low income taxpayer clinics (LITCs), and I know her from her time in those roles. Most recently, she has served as the Taxpayer Advocate of New York City. Her career path follows the same path of the most recent previous hire of the Tax Court into the STJ ranks when it selected STJ Leyden. STJ Leyden ran the LITC at University of Connecticut for many years prior to holding the position of Taxpayer Advocate for New York City for a short period prior to her selection as a member of the Tax Court. STJ Choi has much less time running a LITC but several years as a taxpayer advocate where she dealt with local tax issues rather than federal ones. Both positions prepare someone for dealing with the types of taxpayers typical in the cases assigned to STJs.
The information below is taken from the press release:
Special Trial Judge Choi holds a Bachelor of Arts, magna cum laude, in Political Science from the University of Akron, and both a Juris Doctor and Master of Laws in Taxation from the Washington University School of Law. In addition to time spent in private practice working on a variety of legal issues, Special Trial Judge Choi taught Ethics & Media at Sanford Brown College and was a Lecturer in Law at the Washington University School of Law. Special Trial Judge Choi spent several years working for Low Income Taxpayer Clinics (LITCs), having served as the LITC Program Director for Nevada Legal Services from 2010-2014 and as a Supervising Attorney with the Washington University LITC from 2014-2016. From June 2016 through September 2021, Special Trial Judge Choi was the Taxpayer Advocate in the New York City Department of Finance.
New STJ Landy also has a background somewhat typical of prior STJs. He comes to the bench from a position as an attorney with the Office of Chief Counsel, IRS. Both STJs Panuthos and Carluzzo also came to the Tax Court from a background with Chief Counsel’s office though their tenure with Chief Counsel was longer than STJ Landy’s. Prior to joining Chief Counsel, he worked several years in private practice.
The information below is taken from the press release:
Special Trial Judge Landy holds a Bachelor of Science in Chemistry and a Master of Science in Sport and Entertainment Management from the University of South Carolina, a Juris Doctor from the University of South Carolina School of Law, and a Master of Laws in Taxation from the Northwestern University Pritzker School of Law. From 2010 to 2016, Special Trial Judge Landy was an Associate Attorney with McNair Law Firm, P.A. (now Burr & Forman, LLP). From August 2016 until he joined the Court, Special Trial Judge Landy was a Senior Attorney with the Internal Revenue Service Office of Chief Counsel.
The Court has received a bumper crop of cases in 2021 many of which are the types of cases handled by STJs. The addition of two new STJs should be welcome news at the Court and should allow it to better serve the high number of petitioners coming before it recently. The Court has enjoyed really good STJs over the years I have practiced before it. I expect that will continue with its newest selections.
Murdock Award
On November 21, 2021, the US Tax Court announced that Special Trial Judge Daniel A. Guy, Jr., received the J. Edgar Murdock Award for his distinguished service to the Tax Court. We are slow in acknowledging this important recognition. This is not an annual award but one given periodically when the Court seeks to recognize someone special in its ranks. It’s interesting and appropriate that three of the last four recipients have been STJs. These judges work very hard and handle a high volume of cases – especially pro se cases. That’s not to say that regular judges do not work hard but rather that the recognition of STJs seems to show the Court’s continued concern for pro se taxpayers who make up such a large part of its docket.
The Murdock Award commemorates Judge John Edgar Murdock, who served on the Tax Court from 1926 to 1968 and, along with Judge Dawson for whom its new court management system is named, was one of the most important judges to serve on the court. Given some of the problems with DAWSON recently, Judge Murdock may have gotten the better recognition. Further background on Judge Murdock can be found here.
Judge Guy has had a long career with the Court not only as a STJ for the past decade but as a clerk to a judge and as an attorney. The Court has a number of attorneys who work for it behind the scenes and who do much important work to keep the Court functioning. The announcement of the award doesn’t specify all of the things that Judge Guy has done over his career to deserve the award but his work as an attorney there as well as his work as an STJ would have been a part of the reason for the recognition. Congratulations for a well-deserved award.