Internal Revenue Service
The IRS Independent Office of Appeals allows taxpayer’s to informally protest many different types of IRS decisions, such as: denial of an offer in compromise, denial of innocent spouse relief, denial of penalty abatement relief, filing of a Federal Tax Lien, assessment of the Trust Fund Recovery Penalty. It is important to note that appeals must be filed by the deadline on the IRS notice the taxpayer received. The appeals are generally informal and usually take place through correspondence and telephone conferences after which the appeals officer will issue a Notice of Determination.
Depending on the type of appeal, a taxpayer can file a petition with the United States Tax Court within 30 days of a Notice of Determination. A taxpayer can also file a petition with the United States Tax Court within 90 days of a Notice of Deficiency. Formal trials with formal procedural rules are held before a Federal Judge at multiple locations throughout the United States. There is no right to a jury trial. A taxpayer may appeal the decision of the United States Tax Court by formally filing an appeal to the United States Court of Appeals with jurisdiction over the taxpayer’s residence.
New York State
New York State offers taxpayers the option of an informal Conciliation Conference as the first avenue of appeal. Requests for Conciliation Conferences must be filed with the Bureau of Conciliation and Mediation Services by the deadline on the Notice of Deficiency or Notice of Determination, usually 90 days. After the conference and the submission of any additional information, the mediator will issue a Conciliation Order. A taxpayer may then file a formal petition with the Division of Tax Appeals within 90 days of the date of the Conciliation Order.
Alternately, a taxpayer can file a petition with the Division of Tax Appeals directly. A formal hearing will be held before an Administrative Law Judge after which the Administrative Law Judge will issue a determination. A taxpayer may then appeal that determination to the Tax Appeals Tribunal within 30 days of the determination. The Tax Appeals Tribunal does not conduct a new hearing but rather reviews the records from below. However, the parties may request oral argument before the Tax Appeals Tribunal.
The only remaining recourse available to a taxpayer who is unhappy with the decision of the Tax Appeals Tribunal is to file an Article 78 proceeding with the Third Department of the Appellate Division (located in Albany).