The ability to petition the Tax Court is one of the most important rights given to U.S. taxpayers. A tax court petition is essentially a lawsuit filed by a taxpayer against the IRS.
90-Day Letters
If you are audited, the IRS will have to send a Notice of Deficiency after the final tax assessment. This is also referred to as a 90-day letter because it gives the taxpayer 90 days to petition the Tax Court.
If you haven’t been working with a tax attorney, you should consult one immediately after receiving the 90-day letter. If you want to keep fighting your case, it’s imperative that you file a Tax Court petition before the deadline.
You can also go to Tax Court for other disputes, such as when a Collection Due Process hearing isn’t resolved in your favor. However, not all disagreements with the IRS can be taken to Tax Court, including issues that are appeal under the Collection Appeals Program.
What’s Special About Tax Court?
Tax Courts only hear tax cases. There are also other courts you can use to resolve tax cases, such as federal district courts and the Court of Federal Claims.
The unique attribute of a Tax Court case is that the taxpayer does not have to pay the disputed amount until the case is resolved. If you use one of the other courts, you’ll have the pay the disputed amount and then sue for a refund. This is one reason you should not miss the 90-day deadline to petition the Tax Court. If you do, the only way you can litigate your case is by first paying the disputed amount to the IRS.
Will Your Case Go to Trial?
Most Tax Court cases are settled before trial. Petitioning the Tax Court can be a strategic maneuver to continue negotiating without being required to pay the disputed tax liability. However, you shouldn’t petition the Tax Court to make frivolous arguments or merely to delay collection of the tax.
If you have an IRS tax dispute and are thinking about petitioning the Tax Court, contact a tax attorney for assistance.
The Gartzman Law Firm handles Tax Court litigation and other tax resolution cases. Use our contact form to request a consultation with an Atlanta tax resolution attorney.