About the Tax Court
- The United States Tax Court is a court of record established by Congress under Article I of the U.S. Constitution. When the Commissioner of Internal Revenue has determined a tax deficiency, the taxpayer may dispute the deficiency in the Tax Court before paying any disputed amount.
- The Tax Court’s jurisdiction also includes the authority to redetermined transferee liability, make certain types of declaratory judgments, adjust partnership items, order abatement of interest, award administrative and litigation costs, redetermine worker classification, determine relief from joint and several liability on a joint return, review certain collection actions, and review awards to whistleblowers who provide information to the Commissioner of Internal Revenue on or after December 20, 2006.
Judges of U.S. Tax Court
- Judges of The Tax Court is composed of 19 presidentially appointed members. Trial sessions are conducted and other work of the Court is performed by those judges, by senior judges serving on recall, and by special trial judges. All of the judges have expertise in the tax laws and apply that expertise in a manner to ensure that taxpayers are assessed only what they owe, and no more. Although the Court is physically located in Washington, D.C., the judges travel nationwide to conduct trials in various designated cities. Please visit https://www.ustaxcourt.gov/press/05052010_exam.pdf.
What to Consider...
- A case in the Tax Court is commenced by the filing of a petition. The petition must be timely filed within the allowable time. The Court cannot extend the time for filing which is set by statute.
- A $60 filing fee must be paid when the petition is filed. Once the petition is filed, payment of the underlying tax ordinarily is postponed until the case has been decided.
- In certain tax disputes involving $50,000 or less, taxpayers may elect to have their case conducted under the Court's simplified small tax case procedure. Trials in small tax cases generally are less formal and result in a speedier disposition. However, decisions entered pursuant to small tax case procedures are not appealable.
Tax Court Procedures
- Cases are calendared for trial as soon as practicable (on a first in/ first out basis) after the case becomes at issue. When a case is calendared, the parties are notified by the Court of the date, time, and place of trial. Trials are conducted before one judge, without a jury, and taxpayers are permitted to represent themselves if they desire. Taxpayers may be represented by practitioners admitted to the bar of the Tax Court.
- The vast majority of cases are settled by mutual agreement without the necessity of a trial. However, if a trial is conducted, in due course a report is ordinarily issued by the presiding judge setting forth findings of fact and an opinion. The case is then closed in accordance with the judge's opinion by entry of a decision. Please visit http://www.ustaxcourt.gov/taxpayer_info_intro.htm to learn more about starting a case in the Court.
What our program will teach you...
- what to do to pass the admissions exam
- what to do before trial proceedings
- what to do during trial proceedings
- what to do after trial proceedings
- what to do to remain in compliance
Other Federal courts where Tax Controversies may be litigated...
- Tax cases may also be brought in Federal district courts and the U.S. Court of Federal Claims. But the disputed amounts must be paid beforehand.
Who may Practice before the Federal Courts
- Only licensed attorneys, in good standing, admitted to practice within a State or territorial jurisdiction, are eligible to represent taxpayers who choose any of these forums. United States Tax Court Practitioners are not eligible to represent taxpayers in forums other than the U.S. Tax Court and may be prosecuted for unauthorized practice of law should any one of them attempt to do so. However, U.S. Tax Court Practitioners may act as tax practitioner consultants and assist the licensed attorney in researching and developing his or her appeal taken from the U.S. Tax Court to the U.S. Court of Appeals.
Points to Remember About Tax Court
- No Jury Trial – You do not have a right to a jury trial in Tax Court. A single Judge, paid by the United States Government, will decide your case.
- Limited Discovery – The discovery rules are less broad in a Tax Court case and you generally do not have the right to depose government witnesses.
- Tax Savvy Judges – Tax Court judges are typically very intelligent people with many years of training and experience in federal tax matters.
- Stipulation of Facts Required – The parties are required, prior to trial, to voluntarily share information with one another and work together to formulate a thorough and complete stipulation of the facts of the case.
- Post-Trial Briefing – Unlike civil appeals courts where parties brief the Judges about the facts and law of the case prior to the trial, the Tax Court does not allow pre-trial briefings. Instead, Tax Court rules require that the taxpayer and the IRS file their briefs at the close of trial after the factual issues have been argued before the Judge.
- The following is reprinted from the Tax Attorney Blog and is just plain good advice:
"If you intend to take your case before a Tax Court Judge, you had better thoroughly understand and comply with these rules [U.S. Tax Court Rules of Practice and Procedure]. It is very dangerous to have just a little knowledge about the Tax Court trial process. For instance, with respect to the Stipulation of Facts, it could be fatal to agree to any factual stipulation proposed by government counsel without fully understanding how the admission of that fact will affect the tax treatment of an item in dispute. We have seen taxpayers admit seemingly innocent facts only to have it come back to haunt them later when the judge issues his or her final decision. Seondly, Tax Court Cases are won in the preparation before trial, not at the trial itself. There are no Perry Mason (1960's T.V. character) moments in Tax Court. A good tax lawyer will prepare the case so that there are no surprises – none for the taxpayer, none for the Judge and, most importantly, none for himself. This level of preparation requires an almost rote memorization of the facts and their bearing on the issues involved. The best tax lawyers, by virtue of meticulous preparation and a complete command of the facts and the issues, put a lot of pressure on IRS counsel to settle the case in a manner favorable to the taxpayer rather than risk taking the case to trial and losing. No lawyer wants to be on the losing end of a published Tax Court case." Please visit https://www.ustaxcourt.gov/press/05052010_exam.pdf