Supreme Court Holds IRS To Their Own Standard In April Ruling

The IRS suffered a significant defeat in the U.S. Supreme Court at the end of April after a unanimous decision authored by Justice Amy Coney Barrett in the case Boechler, P.C. v Commissioner. The IRS argued that a taxpayer who filed an appeal one day after a deadline had lost their opportunity to challenge a tax penalty. After some deliberation, the Supreme Court rejected the argument 9-0, marking the second unanimous loss for the IRS within the last several months.

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Boechler, P.C. v Commissioner: Appeal Filed One Day too Late

The IRS is looked upon with disdain by many American citizens, especially given their infamous lack of flexibility or mercy toward everyday people who miss deadlines or make mistakes on their frequently complicated tax returns. Although the IRS occasionally makes significant errors on its own and is notorious for its delays in processing tax returns, appeals, and other paperwork from citizens, the agency simultaneously tends to lack pity toward taxpayers who make honest mistakes or are late to file, and frequently file for excessive penalties as a result.

In the court case Boechler, P.C. v Commissioner, a personal injury firm missed a deadline and filed their appeal over a tax penalty one day after a deadline. The IRS argued that this meant that Boechler, P.C. could not seek review and had lost their right to file an appeal. However, the U.S. Tax Court code enables taxpayers to seek reviews within 30 days of a deadline. In the decision, Justice Barrett noted, “All agree that the parenthetical grants the Tax Court jurisdiction over petitions for review…and all agree that the provision imposes a 30-day deadline to file those petitions. The question is whether the provision limits the Tax Court’s jurisdiction to petitions filed within that time frame.”

Supreme Court Rules On Ambiguity Within The Tax Court Code

There is some ambiguity within the tax court code that enables taxpayers to file within 30 days of a deadline. Some law experts question whether this extends to all petitions, only those filed by the deadline, those under the IRS’s determination, or those under some other conditions.

The Supreme Court concluded that because the statute could hold multiple interpretations, the IRS’s argument fell short. The agency secondarily argued that a more straightforward statute disallows injunctions unless the taxpayer has appealed prior to the deadline, but ultimately the Court concluded that it is not illogical to allow both late appeals and injunctive relief within them.

The Court issued additional commentary in its decision, stating that the 30 day deadline imposed by the IRS is subject to equitable tolling and that the Tax Court holds the right to waive the deadline in some certain circumstances. Additionally, the tax code leans toward protection of taxpayers and provides certain due process rights for taxpayers, which some legal experts argue should be especially generous considering the significant scope and power held by tax collecting authorities.

In the last few years, the IRS has tended toward a harsh enforcement attitude without room for honest mistakes on behalf of taxpayers. Many taxpayers feel relief that the IRS has been held to its own standard as a result of the Supreme Court’s 9-0 ruling on behalf of a taxpaying business.

Avoid Missing Deadlines With An Experienced Tax Attorney In Arizona

When it comes to working with the IRS and filing tax appeals, you need representation from an attorney who fully understands the tax code and IRS procedures. The legal team at Silver Law, PLC, has the experience and expertise to guide you through every step of the process. We are ready to review your case, help you understand your options, and provide representation that will protect your rights. Schedule your confidential consultation with us today.


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