Tax Procedure: Naked Assessments, New Matter, and the Burden of Proof, a Procedural Grab Bag

shutterstock_449681443The burden of proof is important in any litigation. While this is equally true in tax cases, there are some special rules that apply. For example, a tax assessment issued by the IRS is subject to a presumption of correctness, leaving the taxpayer to establish, by a preponderance of the evidence, that the assessment is incorrect. See Helvering v Taylor, 293 U.S. 507, 515 (1935). But that presumption may not apply if the assessment is “naked” and lacks any foundation. See United States v. Janis, 428 U.S. 433, 441-42 (1976). In a similar vein, while the burden of proof is generally on the taxpayer, if the IRS asserts new matter in its answer, the government will bear the burden of proof.… Read More

A Defective Tax Court Petition Can Still Toll the Assessment Statute of Limitations.

Under Section 6501(a) of the Internal Revenue Code, the IRS generally has three years to assess additional taxes after a return is filed. There are a number of exceptions, however, including when “a proceeding in respect of the deficiency is placed on the docket of the Tax Court,” in which case the statutory period is tolled “until the decision of the Tax Court becomes final” plus sixty days. I.R.C. § 6503(a)(1).

What if the petition that is filed is defective due to lack of jurisdiction? The Eleventh Circuit recently addressed this issue in Shockley v. Commissioner, 2012 U.S. App. LEXIS 14200 (11th Cir.Read More

Haven’t We Been Here Before? The Supreme Court Looks at the Limitations Period for Tax Assessments (Again).

Nothing in the Internal Revenue Code is simple.

In most cases that wind up in court, there is a statute of limitations. In tax cases, there are two: Section 6501 of the Code governs how long the government has to issue an assessment of additional tax after a taxpayer files a return, while Section 6502 governs how long it has to collect or to file a suit to collect.

And Section 6501 does not offer a single period to assess. Instead it offers three: a three year period, which is the norm, a six year period, which may be applied where gross income is understated, and an infinite period, which is applied where a false or fraudulent return is filed, a taxpayer willfully attempts to evade tax liability, or no return is filed.Read More