Tax Administration

Administrative Changes Could Lead to Earlier Resolution of Tax Disputes Gao ID: GGD-86-75 July 30, 1986

GAO examined the U.S. Tax Court's case load to determine whether the number of cases filed with the court could be reduced by settling more cases through the Internal Revenue Service's (IRS) appeals process, at less cost to the taxpayers and the government.

GAO found that: (1) many taxpayers who initially bypassed the IRS internal appeals process and filed with the court eventually settled their cases out of court with the appeals division; (2) cases ultimately settled by IRS cost the government approximately $1.2 million in court processing costs and taxpayers $268,200 in filing fees; (3) some of the processing and filing costs could have been eliminated had the cases been filed with IRS; and (4) more than one-third of the taxpayers did not fully understand the dispute resolution process before filing with the tax court. GAO believes IRS could do more to involve the appeals division in resolving cases by better informing taxpayers about the process and encouraging them to go to the appeals division before filing with the court.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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