Yearly Archives: 2019

The United States Tax Court’s website (www.ustaxcourt.gov) announced that the Tax Court shut down operations on Friday, December 28, 2018, at 11:59 p.m. and will remain closed until further notice.  The IRS reminds taxpayers and tax professionals the Tax Court website is the best place to get information about a pending case.

There are some important points for taxpayers and tax professionals to keep in mind. These are some questions and answers to help during the current appropriations lapse.

Q: What should I do if a document I mailed or sent to the Tax Court was returned to me?

A: The Tax Court website indicates that mail sent to the court through the U.S.  Postal Service or through designated private delivery services may have been returned undelivered.  If a document you sent to the Tax Court was returned to you, as the Tax Court website indicates, re-mail or re-send the document to the Court with a copy of the envelope or container (with the postmark or proof of mailing date) in which it was first mailed or sent. In addition, please retain the original.

My case was calendared for trial.  What does the Tax Court’s closure mean for my pending case? 

The Tax Court canceled trial sessions for January 28, 2019 (El Paso, TX; Los Angeles, CA; New York, NY; Philadelphia, PA; San Diego, CA; and Lubbock, TX), February 4, 2019 (Hartford, CT; Houston, TX; San Francisco, CA; Seattle, WA; St. Paul, MN; Washington, DC; and Winston-Salem, NC) and February 11, 2019 (Detroit, MI; Los Angeles, CA; New York, NY; San Diego, CA; and Mobile, AL). The Tax Court will inform taxpayers who had cases on the canceled trial sessions of their new trial dates.

The Tax Court’s website indicates that it will make a decision about the February 25, 2019 trial sessions (Atlanta, GA; Chicago, IL; Dallas, TX; Los Angeles, CA; and Philadelphia, PA) on or before February 7, 2019.  Taxpayers with cases that are scheduled for trial sessions that have not been canceled or that have not yet been scheduled for trial should expect their cases to proceed in the normal course until further notice.

If my case was on a canceled trial session, when will I have an opportunity to resolve my case with Appeals or Chief Counsel after the government reopens? 

After the IRS and Chief Counsel reopen, we will make our best efforts to expeditiously resolve ases. 

Where can I get more information about my Tax Court case? 

If someone is representing you in your case, you should contact your representative. In addition, the Tax Court’s website is the best place for updates.  The IRS Chief Counsel and Appeals personnel assigned to your case may be furloughed and will not be available to answer your questions until the government reopens.  In addition, The American Bar Association (ABA) is conducting a webinar on January 28, 2019, and you can get more information from the ABA Tax Section website (www.americanbar.org/groups/taxation). Taxpayers seeking assistance from Low Income Taxpayer Clinics (LITCs) can find a list of LITCs on the Tax Court’s website (www.ustaxcourt.gov/clinics/clinics.pdf).

During the shutdown, does interest continue to accrue on the tax that I am disputing in my pending Tax Court case? 

Yes. To avoid additional interest on the tax that you are disputing in your pending Tax Court case, you can stop the running of interest by making a payment to the IRS.  Go to www.irs.gov/payments for payment options available to you.  The IRS is continuing to process payments during the shutdown.

What should I do if I received a bill for the tax liability that is the subject of my Tax Court case? 

If you receive a collection notice for the tax that is in dispute in your Tax Court case, it may be because the IRS has not received your petition and has made a premature assessment.  When the government reopens, the IRS attorney assigned to your case will determine if a premature assessment was made and request that the IRS abate the premature assessment.

 

My colleague Steven Klitzner is advising Taxpayers who owe money, are being audited, or who have not filed their returns and who may be breathing a sigh of relief, during this IRS government shutdown; Wrong strategy! They need to take advantage of the situation.

We have been advising our clients to get their ducks in a row, get their paperwork finished, get their offers prepared and/or request for installment payment plans prepared; so that when the IRS reopens they will be ready to submit their request to an overwhelmed IRS.
 
Now is the time to get ahead of the IRS without the threat of them taking bank accounts or wages or closing businesses. 

* If you owe, get your financial documentation together. 
* If you are being audited, get your proof of income and expenses. 
* If you have unfiled returns, get them filed and get your current taxes paid.
 

When the IRS goes back to work, they will be overwhelmed. The employees will be bitter and frustrated. They will want to make deals to clear their inventory. By being proactive and ready, taxpayers can help themselves by helping the IRS resolve cases.
 

 

According to Law360, a U.S. Senate Finance Committee member on January 22, 2019 questioned the legality of the Internal Revenue Service plan to recall 46,000 furloughed workers next week, which the agency would execute if the partial federal government shutdown remains in effect.

Sen. Mark Warner, D-Va., the ranking member of the committee’s taxation and IRS oversight subcommittee, asked IRS Commissioner Chuck Rettig what circumstances led to his decision to recall furloughed workers, which is a departure from previous policy. The IRS announced Jan. 15 that if the shutdown, which began Dec. 22, remained in effect, more than 46,000 workers will be recalled from furlough on Jan. 28 to begin the tax filing season.

“It is unclear that these activities could be described as ‘emergencies involving the safety of human life or the protection of property’ that would allow for excepted employees to perform these duties while Congress has not appropriated funding for your agency,” Warner’s letter said.

The IRS said in its updated contingency plan that 46,052 employees, more than 57 percent of its workforce, would be classified as "excepted," a sizable increase from the 9,492 employees classified as such under a previous plan. The workers would be recalled to start the tax season and begin processing refunds.

A vast majority of IRS employees currently remain on furlough during the government shutdown, which began amid a stalemate between President Donald Trump and congressional Democrats over funding for a wall along the country's Mexico border.
 

The Antideficiency Act States That Only Certain Classifications of Federal Workers, Namely Those Whose Service Involves Emergencies Affecting Human Life or the Protection of Property, Can Volunteer Their Time.

In a separate letter, Warner questioned U.S. Treasury Secretary Steven Mnuchin about why some employees were recalled to process paperwork that would allow banks to provide home loans.

Democratic lawmakers have previously raised concerns over whether nonexcepted federal employees can be recalled from furlough during a shutdown without receiving pay, after Rettig announced on Jan. 7 that a significant portion of the IRS' workforce would be recalled to begin the filing season.

Is this any way to run a government?