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What Tax Pros Should Know About Tax Court’s Looming Shutdown

Oct. 15, 2020, 8:46 AM

If you feel like you need a break to re-program in 2020, you’re not alone: The U.S. Tax Court will be shutting down parts of its online system late this year. That’s big news for tax practitioners and taxpayers.

There’s a good reason for the pause. Following the break, the court will be launching a new case management system called DAWSON (Docket Access Within a Secure Online Network).

The court expects DAWSON to be active by Dec. 28, but will need some time to get the new system in place. As a result, beginning at 5 p.m. on Nov. 20 the current e-filing system will become inaccessible, and all electronic files will become read-only. Cases will remain electronically viewable, but no documents can be e-filed in the current system after that time.

The court doesn’t anticipate issuing any orders or opinions during this time. If you’re used to getting your regular fix of court opinions and analysis online, you’re going to have to wait until 2021.

Tax Court Opinions

Under normal conditions, the Tax Court issues several kinds of opinions:

Summary Opinions. A Summary Opinion is only issued for S (small) cases, which are those involving disputes of $50,000 or less. These trials tend to be faster and less formal, but pursuant to Section 7463(b), the resulting opinion cannot be appealed or used as precedent. Summary Opinions are available online for decisions on or after Jan. 10, 2001. Bench Opinions. A Judge may issue a Bench Opinion in a regular or S (small) case during the trial session. A Bench Opinion cannot be relied on as precedent. Bench Opinions are available online for decisions issued after June 17, 2011.

Tax Court Opinions/Memorandum Opinions. An opinion in a regular case can be issued as a Memorandum Opinion or as a Tax Court Opinion. Generally, a Memorandum Opinion is issued in a fact-heavy matter that doesn’t involve a novel legal issue (meaning that the law is settled), while a Tax Court opinion involves a sufficiently important and potentially new legal issue or principle. Both kinds (Tax Court Opinions and Memorandum Opinions) can be cited as legal authority and appealed. Tax Court Opinions and Memorandum Opinions are available online for decisions dating back to Sept. 25, 1995.

Typically, Tax Court opinions (other than Bench Opinions) are posted daily on the Tax Court’s website after 3:30 p.m. Eastern time. The Tax Court doesn’t charge for access to opinions.

What about cases that haven’t yet been resolved?

To accommodate taxpayers with pending cases, Chief Judge Maurice Foley has issued an order (Administrative Order No. 2020-04) extending by 60 days the due dates for answers to petitions filed between Sept. 21 and Oct. 28.

All other documents required to be filed while the system is inactive (generally, those to be filed between Nov. 20 and Dec. 28) must be filed on paper with the court. No motion for leave will be required, but the filing party must include a certificate demonstrating service on the other party.

What kinds of cases make it to U.S. Tax Court?

The Tax Court (previously called the Board of Tax Appeals) was created in 1924 to resolve federal tax controversies. Today, the court’s average caseload hovers around 30,000 per year. By far most of the cases are S (small) cases and are pro se, meaning that taxpayers are self-represented. That’s consistent with representation in civil cases in state and federal courts.

Typically, when the IRS has made a determination that there is a tax deficiency, a taxpayer can dispute the deficiency in Tax Court. The court has the authority to hear other tax matters, including requests for abatement of interest, review of some collections actions, and determination of worker classification.

The court is physically located in Washington, D.C., but its judges travel all over the country for trials. There is no right to a jury in Tax Court: Trials are heard before a judge.

While case loads have been reduced and modified due to Covid-19, trials are still being scheduled. You can view the 2020 fall schedule here, and the 2021 winter schedule here.

This is a weekly column from Kelly Phillips Erb, the TaxGirl. Erb offers commentary on the latest in tax news, tax law, and tax policy. Look for Erb’s column every week from Bloomberg Tax and follow her on Twitter at @taxgirl.

To contact the reporter on this story: Kelly Phillips Erb at kelly.erb@taxgirl.com

To contact the editors responsible for this story: Patrick Ambrosio at pambrosio@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com