The proper payment of taxes is central to the financial health of individuals and businesses. State, federal, and local governments will sometimes seek payment through legal actions. But tax controversies can arise for many reasons. For example, a taxpayer might believe that their tax assessment was unfair or inaccurate. When this happens, it is necessary to find a dedicated tax lawyer to advise you on how to proceed. A Washington DC U.S. Tax Court litigation attorney could help you challenge a tax assessment that you believe to be incorrect.
How U.S. Tax Court Works
A tax controversy is any dispute that arises between the Internal Revenue Service (IRS) and a taxpayer, who may be an individual or a business. A dispute concerning the correct amount of tax that is owed is the simplest example of a tax controversy that might go to U.S. Tax Court. It is also possible to challenge a denial of collection alternatives, such as an offer in compromise or an installment agreement plan.
A Washington DC U.S. Tax Court lawyer is generally only needed if internal appeals have been exhausted and the assessment being disputed exceeds $50,000; otherwise, many small-claims taxpayers are able to navigate the system without a tax litigation lawyer. It is exceedingly rare for one of these cases to go to trial, as they are usually settled before they are seen by a Judge. If the petitioner or the respondent is dissatisfied with the result, they can bring the matter to U.S. Court of Appeals.
One of the benefits of U.S. Tax Court is that the petitioner does not need to prepay their tax ahead of time in order to contest it, which is required for other tax litigation courts like the U.S. District Court and the U.S. Court of Federal Claims.
Notices from the IRS
The IRS is required to issue a Notice of Deficiency before assessing additional tax. The taxpayer has 90 days to file a Petition to U.S. Tax Court to challenge the assessment, although it will be referred to IRS Appeals for settlement if the taxpayer previously bypassed IRS Appeals.
The IRS is required to issue a Notice of Intent to Levy and Your Right to a Hearing before levying a taxpayer with unpaid taxes that have already been assessed. If the taxpayer requests a Collection Due Process Hearing within 30 days of the Notice and disagrees with the Notice of Determination from IRS Appeals, the taxpayer has 30 days to file a petition to U.S. Tax Court. The Court will review the determination and the IRS is prohibited from collecting the taxes until the case is closed. However, this time is added back to the 10-year collection statute of limitations.
It is rare for a tax controversy case to go to trial. The IRS is keen to receive their money without going through the expense and hassle involved in a trial. As soon as the IRS notifies a taxpayer of a problem, a local tax litigation lawyer could act to identify the issue and work out an administrative solution.
Learn Your Options with a Washington DC U.S. Tax Court Litigation Lawyer
Disputes with the IRS must always be taken seriously. While criminal charges are highly unlikely, you could still be required to pay overdue taxes with significant civil penalties. When a tax dispute arises, it may be necessary to hire a tax litigation lawyer who could guide you through the U.S. Tax Court experience.
A Washington DC U.S. Tax Court litigation attorney could provide essential assistance to someone who is contending with a tax assessment greater than the $50,000 cap for “small claims.” A lawyer could provide a variety of services to put you in a position to succeed, so contact one today to learn more.