Tax law is complicated for everyone involved, and perhaps the most complicated aspect of all the process of tax litigation is the appeals process. If you have been audited or have been through Tax Court with an unfavorable decision, it will be helpful for you to understand the basics of appeals as they play out in the context of tax litigation.
This post is part 1 of a two-part overview of the tax litigation process. The first post covers Tax Court.
Two different types of appeals
One of the many aspects of tax court appeals that complicate matters is the fact that there are two distinct steps in the overall process, both of which are referred to as “appeals.”
The Tax Appeals Office
The first type of appeal comes before a case is litigated. Appealing to the Tax Appeals Office happens after you have received an unfavorable audit and you want to dispute the findings. This is a critical step and is generally necessary before a case can go to the Tax Court at all.
With the guidance and representation of an experienced tax attorney, it is often possible to have the issues with the audit fixed during this stage of the proceedings, avoiding the necessity for your case to go to court at all.
Appealing a Tax Court verdict
The second type of appeal in Tax Court is the type of appeal that would occur in other type of litigation. After your case has been tried in court, you can petition (“appeal”) to a higher court to look at the case to possible reverse the outcome.
There are a couple of important things to understand about this type of appeal:
- The appellate court does not re-try the same case. There are no new facts or new evidence brought before the appellate court. This court looks at the procedures of the lower court to determine if any error was made that would have compromised the outcome.
- The appellate process might not change the outcome. There are many instances in which an appellate court affirms the lower court’s rulings. In other cases, the appellate court sends the case back to the lower court to fix some legal or procedural errors, but the end result ends up being the same. An appeal is no guarantee of a better outcome.
- Appellate law is different than litigation. This type of case requires specific knowledge and experience. It is important to work with an attorney who has thorough knowledge of both tax law and appellate law if you need to appeal a Tax Court ruling.
This is a basic outline of the two types of appeals involved with tax litigation. It is important to remember that these are high-level explanations only. Every case is unique and involves numerous factors that require expertise in handling.
If you are facing serious tax problems, the most important thing you can do is talk with an experienced tax litigation attorney who can help protect your rights throughout the legal process.