On January 3, 2018, Chief Judge Marvel of the US Tax Court (Tax Court) announced that Senior Judge Robert A. Wherry, Jr. fully retired as of January 1, 2018, and would no longer be recalled for judicial service.
Judge Wherry was appointed on April 23, 2003, by President George W. Bush. In 2014, Judge Wherry took senior status and continued to try cases. By statute, the Tax Court is composed of 19 presidentially appointed judges. Judges are appointed for a term of 15 years and after an appointed term has expired, or they reach a specified age, may serve as a “senior judge” if recalled by the Tax Court. The Tax Court also has several special trial judges, who generally preside over small tax cases.
Over his almost 15-year tenure at the US Tax Court, Judge Wherry authored more than 260 Division Opinions, Memorandum Opinions and Summary Opinions. (We have previously discussed the differences between each type of opinion.) Prior to joining the Tax Court, Judge Wherry was in private practice and active in many of the local Colorado Tax Bar associations and the American Bar Association Section of Taxation.
Just a few of his many notable Division Opinions include: ADVO, Inc. v. Commissioner, 141 TC 298 (2013), a key decision regarding Internal Revenue Code Section 199’s application to contract manufacturing arrangements; Shea Homes, Inc. v. Commissioner, 142 TC 60 (2014), allowing a homebuilder to defer the recognition of income until the entire development in which the homes were located was complete; and Intermountain Insurance Service of Vail v. Commissioner, 134 TC 211(2010), holding that the overstatement of basis in cases involving property held outside a trade or business did not trigger the longer six-year statute of limitations on assessment. Intermountain was one of the cases that lead to a circuit split and ultimately to the Supreme Court’s opinion in United States v. Home Concrete & Supply, LLC, 132 S. Ct. 1836 (2012). The Supreme Court agreed with Judge Wherry’s holding and found that the extended limitations period for the government to assess a deficiency did not apply when a taxpayer overstated the basis in property that it had sold. For further discussion of the Home Concrete saga, see here. Another notable opinion by Judge Wherry was Taproot Administrative Services, Inc. v. Commissioner, 133 TC 202 (2009), which contains an informative discussion of the deference afforded to different types of guidance issued by the Internal Revenue Service.