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The U.S. Court of Appeals for the Ninth Circuit recently
addressed mootness in the context of section 7436 (employment
classification) cases. Charlotte’s Office Boutique, Inc. v.
Commissioner, 425 F.3d 1203 (9th Cir. 2005), affg. 121 T.C. 89
(2003). The Commissioner argued that there was no actual case or
controversy that a certain individual was an employee of the
taxpayer, and accordingly this deprived the Tax Court of
jurisdiction. Id. at 1206, 1207. In affirming that the Tax
Court had jurisdiction, the court noted: “the Commissioner’s
approach is contrary to the prevalent approach to subject-matter
jurisdiction and the few cases * * * [that have] considered the
Tax Court’s jurisdiction. * * * as a general matter a federal
court’s subject-matter jurisdiction is determined at the time it
is invoked.” Id. at 1208.
Additionally, the Commissioner’s concession of a deficiency
in a deficiency case does not deprive the Tax Court of
jurisdiction over the subject matter of that year; it is the
determination of a deficiency, rather than the existence of a
deficiency, that is dispositive as to our jurisdiction. Id. at
1209 (citing the Tax Court’s reasoning in the underlying case
concluding we had jurisdiction, in which we cited LTV Corp. v.
Commissioner, 64 T.C. 589 (1975), and Hannan v. Commissioner, 52
T.C. 787, 791 (1969)).
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