There are certain issues that the Tax Court stonewalls and refuses to address. One such issue is the meaning of the word “verification” where it appears in I.R.C. Sec. 6330(c)(1). That is the Collection Due Process (CDP) statute that informs Appeals Officers of their duty at a CDP Hearing.
The statute at IRC 6330(1)(c) is short and clearly written:
“The appeals officer shall at the hearing obtain verification from the Secretary that the requirements of any applicable law or administrative procedure have been met.”
Sec. 6330 is part of the 1998 Restructuring and Reform Act (RRA98) which Congress passed to correct IRS collection abuses.
What does “Verification” mean in the Law?
The word “verification” when used in a statute means: “Confirmation of correctness, truth or authenticity by affidavit, oath or deposition.” Black’s Law Dictionary, 6th ed. pg. 1561. See also Cornell’s Wex Legal Dictionary definition of ‘verification.’
The word appears in that sense throughout the Tax Code (e.g. IRC 6065 ) and in the Federal Rules of Civil Procedure. (see e.g. FRCP Rules 5(d)(3), 11(a), 23.1(b), 27(a)(1), 65(b)(1)(A) among others) The FRCP are HERE in pdf format. Search “verifi” to get all the variations.
Even the Tax Court’s own Rules use the word in its correct statutory sense. See e.g. the Tax Court Judicial Complaint Rules, Rule #6(d) “The truth of the statements made in the complaint must be verified in writing under penalty of perjury.” (emphasis added)
From the start of CDP litigation, however, the Tax Court has never required the IRS to produce the “verification” that the statute requires the Appeals Officer to “obtain from the Secretary” “at the hearing.” The Tax Court either ignores the issue or threatens penalties against any petitioner who claims he is entitled by law to a proper “verification” that all laws and procedures were followed. When the Court runs up the ‘frivolous’ flag concerning this issue it NEVER expressly identifies the issue, but leaves it to the petitioner to figure out what his forbidden argument is.
What the Court Uses Instead of a Verification
Instead of a statutory ‘verification’ that indicates all laws and procedures were followed, the Court allows the IRS to use a computer account transcript of the petitioner’s account to serve as an unverified ‘verification.’ The Court then ‘presumes’ the transcript shows, though it never expressly says so, that all laws and procedures were followed. Unless you can show some reason that the IRS transcript (F 4340) is not trustworthy, the Court will allow it to serve in place of a proper verification.
Sometimes this document is “certified” to be authentic and to accurately represent IRS records, but it is never “verified” in the statutory sense to be true and correct itself.
What can a petitioner do?
Various Tax Court judges handle the question differently, but none of them will actually address the question. There appears to be coordination among the judges to suppress the issue, but no fixed policy for exactly how to go about it.
I’d say about half the time Court will simply ignore the issue in its final decision, so you won’t have a “decision” on it that you can appeal. In the other half of the cases the judge will threaten the petitioner with penalties for raising a “frivolous” argument. The Court will never, in my experience, expressly identify the argument it is condemning.
The Respondent also seldom argues against the issue in any brief. For other issues failure oppose your argument would mean R concedes it. But the Court will cover the IRS on this. It will not deem your argument conceded just because R ignored it or devoted no more than a line or two to it.
Dealing with this kind of coordinated stonewalling is not easy and can be financially dangerous. I would suggest that a Motion for Clarification would be the proper response to a vague threat of a penalty. It can always be denied without comment, but it will help set up your appeal and any argument you might have to make against being penalized.
A Motion for a Statement of Facts and Grounds on the issue, if the Court ignored it in a decision, might solidify an appeal.
In any event, you can expect the Court to ignore you or threaten you if you go looking for the “verification” that the Appeals Officer was required by law to obtain from the Secretary for your CDP hearing.
I welcome any comments or suggestions from readers on how to bring this issue to light, or even better, to get the Court to explain why a “verification” for petitioners isn’t the same as one for the IRS.
If you have questions, topics or a situation you'd like to discuss, his phone and email are at the top of every page.
Lysander is not an attorney and it is not his intent to offer legal advice.
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