Gudmundsson v. United States

CHIN, Circuit Judge.

In 2000, plaintiffs-appellants Olafur Gudmundsson (“Gudmundsson”) and Sally Rudrud (together, “plaintiffs”) 1 jointly filed their 1999 federal tax return, reporting income earned on stock Gudmundsson received as compensation from his employer, Aurora Foods, Inc. (“Aurora”), on July 1, 1999. The stock was subject to several contractual and legal restrictions that impeded its marketability for one year — by which point the company’s stock value had plummeted. Plaintiffs sought to amend the tax return and obtain a refund, asserting that they had prematurely reported the stock…