           Case: 14-12326    Date Filed: 01/29/2015   Page: 1 of 3


                                                         [DO NOT PUBLISH]



             IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                            No. 14-12326
                        Non-Argument Calendar
                      ________________________

                            Agency No. 2412-11



DONALD W. WALLIS,
KATHRYN W. WALLIS,

                                              Petitioners - Appellants,

versus

COMMISSIONER OF IRS,

                                              Respondent - Appellee.

                      ________________________

                  Petition for Review of a Decision of the
                               U.S. Tax Court
                        ________________________

                            (January 29, 2015)

Before HULL, JULIE CARNES and BLACK, Circuit Judges.

PER CURIAM:
              Case: 14-12326     Date Filed: 01/29/2015   Page: 2 of 3




      Donald W. Wallis and Kathryn W. Wallis (the Wallises), proceeding pro se,

appeal the Tax Court’s order and decision granting summary judgment against

their petition for redetermination of tax deficiency. On appeal, the Wallises argue

the tax court erred by granting summary judgment because (1) there is a dispute of

material fact and (2) collateral estoppel does not apply. Upon review, we affirm.

      The material facts are not in dispute. The Wallises admit the payments at

issue in this case were made under the same provision of the same partnership

agreement as the payments at issue in Wallis v. Commissioner, 98 T.C.M. (CCH)

364 (T.C. 2009) (“Wallis I”) aff’d, 391 F. App’x 826 (11th Cir. 2010) and the only

difference is the year the payments were made to the Wallises. Absent a

subsequent change in the relevant facts or controlling legal principles, a difference

in tax year does not change the taxable characterization of the amounts at issue.

Commissioner v. Sunnen, 333 U.S. 591, 598-600 (1948).

      The tax court therefore did not err by granting summary judgment on

collateral estoppel grounds. “For collateral estoppel to be invoked 1) the issue

must be identical in the pending case to that decided in the prior proceeding; 2) the

issue must necessarily have been decided in the prior proceeding; 3) the party to be

estopped must have been a party or have been adequately represented by a party in




                                          2
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the first proceeding; and 4) the precluded issue must actually have been litigated in

the first proceeding.” Blohm v. C.I.R., 994 F.2d 1542, 1553 (11th Cir. 1993).

       The Wallises are collaterally estopped from contesting the tax

characterization of the Schedule C payments. First, this case involves the identical

issue as Wallis I: the tax characterization of Schedule C payments made to the

Wallises pursuant to the same, unchanged partnership agreement. 1 Wallis, 391 F.

App’x at 828-30. Second, the tax court decided, and we affirmed, the

characterization of these payments in Wallis I. Id. Third, the Wallises were a

party in Wallis I. See generally id. Fourth, the Wallises and the IRS actually

litigated this issue—i.e., whether the payments were guaranteed payments taxable

as ordinary income or partnership distributions taxable as long-term capital

gains—before the tax court in Wallis I. 2 Wallis, 98 T.C.M. (CCH) 364, at *5-7;

Wallis, 391 F. App’x at 828-30.

       AFFIRMED.


       1
          On appeal, the Wallises argue this case involves the different, unlitigated issue of
whether the payments were properly considered as includible income. However, the only legal
theory the Wallises advances in support of this contention is that the payments are
“distribution[s] by a partnership to a retiring partner.” That is the same argument considered and
rejected in Wallis I, and the tax court determined the payments were instead guaranteed
payments in liquidation of the interest of a retired partner.
       2
         The Wallises are also collaterally estopped from relitigating the accuracy-related
penalty imposed by the Commissioner under I.R.C. § 6662. This Court previously upheld such a
penalty against the Wallises in Wallis I, holding “the Tax Court did not clearly err in finding that
the Wallises did not have reasonable cause for the underpayment or act in good faith with respect
to it.” Wallis v. C.I.R., 391 F. App’x 826, 830-31 (11th Cir. 2010). The Wallises have not
shown how the relevant facts or applicable law have changed since.
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