The IRS continues to pursue the penalty, and subsequently sends David a day letter. The reason why the 90 days is so significant is because the taxpayer has a strict day time-period to file a petition in Tax Court days if the person resides overseas.
Filing a Tax Court petition is not too difficult. The main benefit of Tax Court, is of course a person does not need to pay the tax or penalties that were assessed before filing the petition. Because a non-attorney representative can forced to disclose confidential information the taxpayer may believe was privileged under the attorney-client privilege.
Unlike Tax Court, and unless a person is representing themselves which is typically ill-advised at the district or federal court level , the representative must retain an attorney. An enrolled agent or CPA is not licensed to file lawsuits in either one of these two courts, unless they are also an attorney. One of the main benefits is that the federal court system is not solely reserved for tax matters.
And, the taxpayer will be entitled to a jury of his or her peers, so why the taxpayer may have technical hurdles to climb with respect to specific tax-related matters, juries are less inclined to focuses as heavily on the nuances as a tax court judge might do.
In addition, while most tax court judges are as close to an expert in any particular area of tax that you may find — you may not want that for your tax matter. Rather, you may wish to appeal to the human nature of a jury. What are the best ways to avoid getting into a mess with the IRS is to get into offshore compliance before the IRS can find you. If you owe the IRS money—or more accurately, if the IRS claims you owe them money—you can sue the IRS, generally by paying the contested amount, demanding a refund, and suing to make your case to get that refund.
Tax Rev. Although timely due to the recent evidence of IRS targeting of Tea Party groups, Brunson's article actually pre-dates that scandal, mentioning instead the IRS's lengthy refusal to stop collecting an illegal telephone tax, IRS confusion over the taxation of commodity mutual funds, and other instances of the IRS misinterpreting or ignoring the law. Again, while individual taxpayers can challenge the IRS, no one has legal "standing" the right to sue to challenge a broad IRS practice.
To that, I would add the transportation fringe benefit debacle which caused years of uncertainty , and the upcoming complexities of giving tax refunds now that DOMA has been struck down, and implementing Obamacare.
Professor Brunson offers two suggestions. As Professor Brunson writes, this would be a middle ground between giving all taxpayers standing to sue the IRS over regulations and giving none, by focusing on "groups, across the political spectrum, that are interested in the proper administration of the tax law.
Iowa Dec. Existing Client? Enter the code:. Zachary J. Specifically, Section a 1 provides as follows: a The district courts shall have original jurisdiction, concurrent with the United States Court of Federal Claims, of: 1 Any civil action against the United States for the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected, or any penalty claimed to have been collected without authority or any sum alleged to have been excessive or in any manner wrongfully collected under the internal-revenue laws.
Section a describes the situation as follows: a No suit prior to filing claim for refund No suit or proceeding shall be maintained in any court for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof.
This time frame is outlined in Section a : a Period of limitation on filing claim Claim for credit or refund of an overpayment of any tax imposed by this title in respect of which tax the taxpayer is required to file a return shall be filed by the taxpayer within 3 years from the time the return was filed or 2 years from the time the tax was paid, whichever of such periods expires the later, or if no return was filed by the taxpayer, within 2 years from the time the tax was paid.
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