Millions of businesses and individuals file their taxes each year only to discover that they disagree with the IRS determination regarding what is owed. If you are disputing an IRS determination about taxes you owe, it may be time to speak with a reputable tax attorney regarding a tax court petition. Deciding to file a petition requires timely and decisive action, and a tax attorney can help with the process as well as increase the odds of winning.

Taxpayers are only able to file a tax court petition after they receive a disputed notice of deficiency, notice of certification, or notice of determination. This typically takes place after an official audit by the Internal Revenue Service, but not always.

Should you be informed by the IRS that you owe more taxes than you originally thought, the next step for disputing an IRS determination about taxes is to hire a good Houston tax attorney to aid with filing an official petition.

Disputing an IRS Determination About Taxes with a Tax Court Petition

A taxpayer can only dispute the IRS’s decision if the written communication from the agency cites the person’s right to appeal. If you disagree with the Internal Revenue’s decision and an appeal process is offered , do not sign the agreement form from the government agency.

Valid reasons for disputing an IRS determination about taxes include:

  1. An errant decision made by the IRS via misinterpretation of the law
  2. An improper application of the law due to a misunderstanding of the facts
  3. An inappropriate collection action by the IRS that a taxpayer disagrees with
  4. The IRS’s usage of incorrect facts

In each of these instances, the taxpayer should be ready to prove their particular reason for disputing an IRS determination about taxes.

Appeals made by taxpayers who do not fully provide the information requested during an audit are generally unsuccessful.

Individuals who file an official petition in the U.S. Tax Court may be contacted by Appeals. Typically, Appeals will reach out to taxpayers by letter via the U.S. Postal Service to lay out possible case settlement options.

However, in an effort to save time, Appeals has started phoning some taxpayers for the initial point of contact. Phone outreach from Appeals should include the caller offering their name, title, and badge number, as well as their contact information. They should also have access to the docket number and circumstances of your specific case. Representatives from Appeals should never ask for any banking or credit card information.

While a taxpayer generally has a limited amount of time to file a petition in tax court, Appeals can take up to 120 days or more to contact you. Taxpayers who have not heard from Appeals within 120 days after filing will need to reach out to the IRS directly.

Once a taxpayer is connected with Appeals they can either represent themselves or retain professional legal representation, preferably in the form of a knowledgeable tax attorney. Here is what a reputable tax attorney can offer a client seeking a tax court petition:

  • An intimate understanding of how to dispute IRS processes,
  • Knowing what is needed to prove the reasoning for a dispute,
  • Familiarity with petition filing deadlines,
  • Knowledge of how and where to file the petition,
  • Understanding the process that follows a petition,
  • Experience in successfully representing clients in tax court, and
  • Acting as a liaison between their client and the Internal Revenue Service.

Moving forward in a dispute with the IRS without the aid of a seasoned and reputable tax attorney could be an error in judgement that might impact the outcome of the case. To have a higher degree of confidence in meeting the eligibility to appeal an IRS determination, filing a petition with the tax court, and to have competent representation in court, the help of a tax attorney is the best way forward.

Benefit of Filing a Petition with the Tax Court

When disputing an IRS determination about taxes, the primary benefit of filing a petition in tax court is that it temporarily halts payment and assessment requirements. In other words, for the duration of the tax assessment dispute, you are not obligated to make related payments to the Internal Revenue Service.

Not only does this official pause give a taxpayer a brief break from making IRS payments, the interim also gives the individual the opportunity to obtain additional funds in the event that a tax court rules that the person owes more in taxes than they originally believed. It is important to note that while the statute of limitations on collections may give a taxpayer more time to obtain funds, it only pauses the clock on the Internal Revenue Service’s time limit for collection. It does not shorten it.

Disadvantages of Filing Tax Court Petitions

With millions of U.S. citizens being required to file their taxes annually, it should come as no surprise that there is frequently a large backlog of tax court petition cases in the system. This is partially due to the high number of individuals filing tax court petitions and the amount of time it takes to process each case. It could take more time than you would think for the court to get to your case and make a ruling.

For those people who are hoping to have extra time to allow them to obtain additional funds for paying taxes they were not anticipating, this backlog of cases can be a significant benefit. However, for those individuals who are anxious to simply process the case, get an official ruling, and move on with their lives, the timeline of filing tax court petitions could take longer than they prefer.

An experienced tax attorney will have the industry knowledge to help a person disputing an IRS determination about taxes determine the best way to handle their specific situation and circumstances. From eligibility to filing an official petition to legal representation in tax court, hiring a tax attorney to best represent your interests is an important consideration.