Tax Court

Eligibility: In the event of a deficiency, the deficiency and any additional penalties must not exceed $50,000. In a collection action, the total amount of unpaid taxes, including fines and interest, cannot exceed $ 50,000. In a spousal relief, the relief cannot exceed $50,000. In workers' classification, the amount of the disputed labor tax cannot exceed $50,000.

Small case procedures are heard in about 15 cities more than normal proceedings.

Preliminary and trial proceedings are less formal than ordinary tax court proceedings. Federal rules of evidence are not strictly followed. Instead, a judge can admit whatever evidence he deems relevant.

There is no right to appeal a small case to the Court of Appeal. All rulings and matters decided by the tax court are final and cannot be appealed by the taxpayer or the IRS.

Timely Filing

The deficiency or IRS determination will indicate the number of days available for the taxpayer to file the tax court's claim counting from the date the IRS sent the notification. In the event of a deficiency, the filing must be made 90 days after mailing. In a collect action, the filing must be made 30 days after the notification of determination is sent.

Not pay-to-play

The taxpayer is not obliged to pay the IRS's deficiency or determination for the case to proceed in the tax court.

But if the tax court determines that the taxpayer owes a certain amount or if the taxpayer enters into an understanding with the IRS and accepts a certain amount of tax debt, interest will generally accrue from the tax due date.

Checklist: A complete petition must include:

• Name and signature of the petitioner, including mailing address and telephone number.

• In the case of a joint declaration, the name and signature of the spouse must be included

• Filing fee of $ 60

• Complete declaration of the taxpayer's identification number

• All information requested in the claim form, including an error statement made by the IRS and a statement of facts supporting the claim

• Completed request for place of trial

Confirmation of receipt of a petition

After filing the petition, the taxpayer will receive an acknowledgment of receipt. The notification will contain the file number. The IRS will then file a response within 60 days of receiving the taxpayer's petition, where the IRS will admit or reject the material claims. The IRS will rarely make affirmative allegations, but if they do, the taxpayer must respond to affirmative allegations within 45 days of the response's date.

Status of the court (jurisdiction)

Article 1 The Court (legislative powers).

The main function of tax courts is to adjudicate cases involving deficiencies. The taxpayer's deficiency payment is not a jurisdictional precondition for legal action, unlike refund cases in a Federal District Court or the United States Court of federal claims.

The tax court has jurisdiction in the following cases: deficiencies, matters submitted to the review of legal recovery procedures, determine the employment status, and innocent spouse appeal.

Collateral jurisdiction of the tax court 

The jurisdiction of the tax court has been extended to perform the following functions:

• Restraining premature tax assessments over which the tax court has jurisdiction;

• Enforcing a decision that a taxpayer petitioner has made an irregular payment;

• Review IRS determinations to perform risk assessments and protective measures;

• Redetermine interest on deficiencies;

• Modifying a decision in the event of estate tax cases;

• Declaratory judgment on the value of certain gifts;

• Declaratory decision on the eligibility of an estate for the payment of property tax in instalments; 

• Due process review of levy or lien 

The nature of a proceeding 

The onus is on the taxpayer to prove that the IRS conducted an invalid deficiency determination by a preponderance of the evidence. Unlike a refund request, the taxpayer does not have to show the exact amount of tax.

In certain limited circumstances, the burden of proof will be transferred to the IRS on factual issues. The taxpayer must provide credible evidence to the court on this matter, comply with the verification and registration requirements of tax law, and demonstrate that they have cooperated with reasonable requests from the IRS for witnesses, information, documents, meetings, and interviews.

The tax court will have its own rules of procedure, similar to but distinct from the federal rules of civil procedure:

The tax court allows non-lawyers to appear in court.

Rules of discovery. The tax court's disclosure rules are generally the same as the federal civil procedure rules on disclosure. The tax court rules deal with written interrogatories in rule 71, production of documents or things in rule 72, disposition in rules 74, 80-84, and applications for admission in rule 90. But before a motion of evidence, the taxpayer must try to get discovery information from the IRS and vice versa. If either party does not participate in this informal process, that party will not participate in an official discovery. The purpose of the contact is to clarify as many facts and issues as possible per section 91.

Appellate Review

Within 30 days of sending the written notice to the taxpayer, either party may file a request for reconsideration to the tax court.

To appeal to the United States Court of Appeals, you must appeal to the Registrar of the Tax Court within ninety days of the tax court ruling.

FOR MORE INFORMATION OR TO SEE HOW DANIEL P. VIGILANTE, CPA & PROFIT CONSULTANTS CAN BEST HELP YOU WITH YOUR TAX FILING NEEDS.

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