30-Day Filing Deadline for Tax Court Review of CDP Determination is not Jurisdictional
30-Day Filing Deadline
The Supreme Court of the United States has recently reversed and remanded a decision from the Eighth Circuit, which could work in favor of a good many taxpayers. With this unanimous decision, the justices unanimously held that the 30-day deadline in Code Sec. 6330(d)(1) to petition the Tax Court for review of a collections due process determination is not a jurisdictional deadline and is subject to equitable tolling. So what does this decision entail? Essentially, taxpayers may still seek to have their case heard in Tax Court even if the deadline has passed, if they have good cause for being late.
This favorable decision could, frankly, serve a broader effect for the public. Because most individuals go to Tax Court to fight Notices of Deficiency; however, they have a 90-day deadline. Therefore, ultimately because of the Supreme Court’s decision, it may allow for some more cases where a taxpayer challenges a tax liability in Tax Court and not necessarily be barred by the 90-day filing deadline. We all know deadlines come strong and fast, and many times we just cannot simply prepare adequately because of the constraint. Now, there is a bit of breathing room.
Background and Analysis
The background of this important case starts off with the IRS Office of Appeals sustaining a levy against Boechler, P.C. Under IRS Code Sec. 6330(d)(1), after its collection due process (CDP) hearing. After that, Boechler had 30 days to petition the Tax Court for review of the Appeals Office’s determination. However, Boechler filed its petition one day late. Under Code Sec. 6330(d)(1), a “person may, within 30 days of a determination under this section, petition the Tax Court for review of such determination and the Tax Court shall have jurisdiction with respect to such matter.”
In the Tax Court, the IRS argued that the 30-day deadline in Code Sec. 6330(d)(1) was jurisdictional; therefore, the Tax Court did not have jurisdiction over Boechler’s petition because it was filed after the 30-day deadline. The Tax Court dismissed Boechler’s petition for lack of jurisdiction. The Eighth Circuit Court of Appeals also agreed with the Tax Court.
Boechler moved onto the Supreme Court, which found that the 30-day deadline to file a Tax Court petition for review of a CDP determination is not a jurisdictional deadline and, thus, is subject to equitable tolling. This decision will help taxpayers who don’t file petitions for review of CDP determinations within the 30-day filing period in Code Sec. 6330(d)(1). The IRS will still try to get late-filed petitions dismissed for lack of jurisdiction, but now the late-filing taxpayer will be able to argue that they are entitled to equitable tolling of the filing deadline.
Notice of Deficiency a.k.a the 90-Day Letter
If you received a Notice of Deficiency, also known as the 90-day letter, you should be aware that the IRS is essentially putting you on alert that if you fail to file a petition within a 90-day period, it will move to collecting the tax you owe. Because there is nearly always an area of dispute in the Notice of Deficiency, it would behoove your case greatly if you connected with one of our tax attorneys at Dallo Law Group to help you towards resolution. It is important to note that failing to file a petition with the Tax Court will result in the loss of very important rights and is almost always a bad idea.
If you do not file a petition and you later decide that you disagree with the number the IRS gave, you will be unable to have a judge hear your case until you first pay the entire amount of the tax that the IRS claims to be due even if the IRS is clearly wrong. That is why it is important to reach out to Dallo Law Group as soon as possible. This new Supreme Court decision does provide a bit of flexibility; however, only a tax attorney can file a petition for you in Tax Court. Our strong background at Dallo Law Group and our up-to-date expertise in the field of tax makes us your best partners.