Please find valuable information regarding Federal Tax Litigation in our video blog.
As one of the principal attorneys for Mendes Weed, LLP, I have previously discussed how to initiate a tax court case in U.S. Tax Court if you have not received a desirable result during the course of your audit with IRS Appeals. But, did you know that not all tax cases need to be brought in a U.S. Tax Court?
The majority of cases are brought before the U.S. Tax Court, which is a court that only hears tax cases. The reason many taxpayers bring their cases before the U.S. Tax Court is that they do not have to pay the tax asserted against them prior to filing their petition in U.S. Tax Court. Even if the case is decided against the taxpayer, the taxpayer will not need to pay until all appeals are exhausted. Appeals of tax court decisions go to the appropriate U.S. Court of Appeals. There may also some benefit to having a judge that is more experienced in tax law. However, what if a taxpayer would like to have their case heard by a jury?
In this case, a taxpayer may choose to prepare any asserted tax and, after exhausting all administrative remedies, file a claim for refund in U.S. District Court. This is the only court in which a taxpayer may have a trial by jury. Any appeals of an unfavorable decision would go to the U.S. Court of Appeals for the particular district court where the case was heard.
Alternatively, a case for refund could be brought in the U.S. Court of Federal Claims. No jury trial is available, but what if there is a similar case that was previously brought before the U.S. Court of Federal Claims that a taxpayer believes is favorable to her case? Perhaps, you would want to bring your tax case before this court in that situation.
It is important to meet with a tax lawyer who can discuss your case with you and advise you on which court may be best for your specific case.