HOW TO RESPOND TO TAX CONTROVERSY MATTERS DURING COVID-19

On: September 9, 2020

It is never an easy situation when the Internal Revenue Service contends you owe a tax liability, but you believe that there is nothing due.  Such tax controversy matters are generally governed by specific procedures.

As is the case for many issues, because of COVID-19, there are currently many revised procedures to respond to tax controversy matters.

Tax Controversy Appeals

If your tax controversy matter is in appeals, it will likely continue to move forward, but in a different manner, during COVID-19.

The Internal Revenue Service, on March 25, 2020, as part of its “People First Initiative”, announced that appeals employees will continue to work their cases during COVID-19, and taxpayers are encouraged to promptly respond to any outstanding requests for information for all cases in the Independent Office of Appeals.  Although the appeals office is not currently holding in-person conferences with taxpayers, conferences may be held over the telephone or by videoconference.

Tax Controversy Filings

As for tax controversy filings, more relief will be granted taxpayers than for tax controversy appeals, including by extending deadlines during COVID-19.

Specifically, the Internal Revenue Service, in Notice 2020-23, extended the time for filing all petitions with the Tax Court, or for review of a decision rendered by the Tax Court, filing a claim for credit or refund of any tax, and bringing suit upon a claim for credit or refund of any tax, that are due to be performed on or after April 1, 2020, and before July 15, 2020, until July 15, 2020.

In addition, Notice 2020-23 grants the Internal Revenue Service an additional period of 30 days to take certain action if the last date for performance of the action is on or after April 6, 2020, and before July 15, 2020.  These actions include assessing any tax, giving or making notice of demand for payment of any tax, bringing suit by the United States, and allowing credit or refund of any tax.

Tax Court

There will be many changes regarding Tax Court procedures during COVID-19.

On March 18, 2020, it was announced that the United States Tax Court building in Washington, D.C. would be closed.  The building remains closed, but as of July 10, 2020, the delivery of mail, and the acceptance of hand-delivered documents, at the United States Tax Court will resume.

On May 29, 2020, it was announced that United States Tax Court proceedings would be conducted remotely.

Because of COVID-19, the Tax Court cancelled its March 16 to April 3, April 6 to May 1, and May 4 to July 3, trial sessions around the country (including those trial sessions scheduled in San Francisco and Los Angeles).  The Tax Court, on March 23, 2020, in cancelling the May 4 to July 3 trial sessions, stated that it expects the parties to continue to work together to exchange information and address pending issues; unresolved cases will be scheduled for trial at a later date.

The above discusses changes in how to respond to Federal tax controversy matters during COVID-19; you should consult your applicable state tax authority concerning how to respond to state tax controversy matters during COVID-19.

If you need tax help, always make sure to call Leading Tax Group and don’t attempt to do it yourself.