University of Florida Wins at National Tax Moot Court Competition

by Joshua on February 8, 2011

The University of Florida Tax Moot Court Team earned first place in this year’s National Tax Moot Court Competition sponsored by the Tax Section of the Florida Bar. This is the third consecutive year the UF Tax Moot Court Team advanced to the final round in the competition. The team argued against Ohio Northern University in the final round before a panel United States Tax Court Judges. The panel included Senior Judge Renato Beghe and Special Trial Judges Lewis R. Carluzzo and John Dean.

Competitors at oral argument were James Baley (3L) and Michael Bruno (2L).  Kevin Hall (3L) was part of the team through the brief writing portion and helped prepare the team for oral argument.  Todd Lewis (LL.M.) and Professor Steven Willis co-coached the team.  James Baley also received the award for Best Individual Oralist.

This year’s case required competitors to consider whether an installment sale payment received on the sale of a capital asset which was required to be put into court-ordered escrow during the same taxable year is nonetheless required to be included in income in the year of receipt under the claim of right doctrine.  The doctrine, established in North American Oil Consolidated v. Burnet, 286 U.S. 417 (1932), requires inclusion of income in the year of receipt despite potentially imperfect rights to retain the income.  In the case at hand, the income was received for the sale of stock in a Subchapter-S corporation and a state court lawsuit alleging breaches of warranties and representations had been filed prior to the payment.

The second issue involved whether I.R.C. Sec. 1341 treatment was available for the restoration of amounts received in prior taxable years when repayment occurred in a subsequent taxable year.

The third issue was whether the I.R.C. Sec. 7525 Accountant Client Privilege or the work product doctrine privileged documents prepared regarding certain tax shelter arrangements the seller in the above transaction had engaged his CPA to prepare.

Finally, this is a sentimental post for me as I was a former competitor in this competition which was also the subject of my one of my first blog posts one year ago (more on that in a later post).

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