Tax Court

If you or your company has been audited and the IRS states that you owe taxes, what can you do? One very practical solution is Tax Court. Tax Court stops the collection of taxes by the IRS while the case is pending. In Tax Court, there is no jury and the process and procedures are somewhat different than regular court. If you lost your audit you may be able to succeed or at least cut your losses in Tax Court.

To get into Tax Court you must file a timely Tax Court petition. After the IRS has completed the audit and found you owe taxes you are allowed to go to Tax Court unless you or your company owes Employment Taxes (Withholding Taxes). Before you can enter Tax Court, however, you must first get your "ticket". After an IRS audit, the IRS will mail you or your business a, "Statutory Notice of Deficiency", sometimes called a " 90 Day Letter". This letter is your pass or ticket to go into Tax Court. This Statutory Notice of Deficiency gives you 90 days from its date to file a Tax Court Petition with the Tax Court in Washington, D.C. YOU MUST FILE WITHIN THE 90 DAYS. If you file past the 90 days (this includes weekends, holidays, weekdays) you cannot file.

Therefore it is imperative that you file a petition with the Tax Court before the expiration of the 90 days. Tax Court is a good way to recoup any monies the auditor thinks you owe to the IRS. However, it is really important you do not miss the 90 day deadline for filing the Tax Court petition. If you miss, you still have an option, however, you will have to pay the tax first.

If you have been audited and have passed the 90 day deadline you still have an option. But you must first pay the tax.

You can pay the tax and then file suit in either United States District Court or the Court of Claims. The problem with this, of course is you have to pay the tax first.

Disclaimer: The information in these web pages has been prepared as a service to the community and does not constitute legal advice. This information may not apply to your situation particularly if you do not live in the state of California. Do not make legal decisions based on this material. Consult an attorney in person before making any important legal decision.