While cruising through the
IRM, I ran across a very interesting section that really enlightened me
as to why the IRS and TC choose to "Expedite" "protest cases".
Now I now where some of their arguments that didn't make sense were
coming from. NOTE THE PROCEDURE SECTION, This is what they are
using against us, almost word for word. It looks like it will
also tell us what they will do next.
http://www.irs.gov/irm/part35/ch04s26.html
Part 35. Tax Litigation
Chapter 4. Motions and Answers
Section 26. Protest Cases-Summary Procedures To Efficiently Dispose of
Cases
--------------------------------------------------------------------------------
35.4.26 Protest Cases-Summary Procedures To Efficiently Dispose
of Cases
35.4.26.1 Protest Cases-Summary Procedures To Efficiently
Dispose of Cases
35.4.26.1 (03-11-1983)
Protest Cases-Summary Procedures To Efficiently Dispose of Cases
During the past several years, Counsel has experienced a dramatic
increase in
the number of "protest cases" which are being docketed, tried, and
decided by
the Tax Court. There has been sufficient judicial precedent, in both
the courts
of appeals and the Tax Court, to allow the Office of Chief Counsel to
move for
summary disposition of certain "protester cases." In addition, the Tax
Court
has commented in its opinions that "protester cases" require a
disproportionate
amount of its time. In view of the foregoing, the following procedures
are set
forth in order to provide guidelines for the use of summary proceedings
to
resolve certain of the protester cases.
Definition of a Protester Case
For purposes of this section, a protester case DOES NOT include CHURCH
OR FAMILY
TRUST-TYPE cases. For purposes of this section, a protester case does
include a
case where the petitioner has refused to pay Federal income tax for
what are
asserted to be constitutional, religious, or moral reasons. Usually, the
defense as to the payment or reporting of the tax, may be as follows:
Federal Reserve notes are not money so they are not income when
received (the
legal tender or Federal Reserve note argument).
The income tax violates conscience, religious beliefs, or moral
convictions.
(The First Amendment approach).
The Sixteenth Amendment authorizing the income tax is unconstitutional.
The income tax constitutes prohibited involuntary servitude (the
Thirteenth
Amendment approach).
Filing a return or paying income tax violates the taxpayer's right
against
self-incrimination and due process (the Fifth Amendment approach).
The income tax law is discriminatory (the Fourteenth Amendment
approach).
There are other possibilities for inclusion of cases within the
procedures
outlined in this section if the case presents some form of social,
moral,
religious, or constitutional objection in generic terms to the
operation of the
country or the right to tax in general as opposed to questioning the
substantive
quality of the Code, regulations, rulings, and/or the determination of
the
Commissioner of Internal Revenue. If it is necessary to develop a
factual
pattern by documentary evidence and testimony, the summary procedures
of this
section would not be applicable.
Procedure
Before Answer
1. If the petition contains no substantive tax issues and there are no
facts
underlying the assignments of error which must be determined or
classified by
further proceedings, a motion to dismiss for failure to state a claim
upon
which relief can be granted (Rule 40, Tax Court Rules of Practice and
Procedure) should be filed in lieu of an answer.
2. If there is a substantive tax issue and/or factual matters to be
developed by
further proceedings, a motion to strike assignments of errors and
allegations of
facts with respect to the "protest issue" should be filed prior to
filing an
answer.
After Answer
1. If an answer has already been filed in a protester case and there
are no
substantive tax issues in dispute and no facts to be further developed,
a
motion for judgment on the pleadings, or a motion for summary judgment
if
exhibits or affidavits are attached, should be filed.
2. If a protester case has been answered and contains no substantive
tax issues
but requires limited factual development (that which could be
accomplished by
affidavit or informal methods other than discovery), motion for summary
judgment should be filed subsequent to the development of the factual
aspects.
3. If a protest case has been answered and contains substantive tax
issues in
addition to the protest issue, a motion for a partial summary judgment
may be
filed to resolve the protest issue. It is contemplated that some protest
petitioners will not be interested in continuing litigation without the
"protest issue." (It is recognized that this approach may be more
cumbersome
than a brief trial and, therefore, is left to field supervisory
discretion.)
If there is any doubt as to whether a particular case comes within the
definition of a "protest case" as defined in this section, the Tax
Litigation
Division should be consulted prior to consideration of the procedural
directives.
Every effort should be made to provide the court with citations to cases
directly in point, especially regular Tax Court opinions and appropriate
appellate court opinions. If no cases are susceptible to citation, use
of the
summary procedure may be inappropriate, unless the pleading clearly
reflects a
failure to state a claim upon which relief can be granted.
Care should be exercised to ensure that the court possesses the correct
taxable
year and the amount of the deficiency so that a decision may be entered
by the
court.
1. A legible copy of the statutory notice of deficiency should be
attached as an
exhibit to any motion filed. In appropriate circumstances a copy of the
return
should also be attached as an exhibit.
2. Any reduction to the deficiencies shown on the notice must be
communicated to
the court as, for example, where the statutory notice contains a
mathematical or
technical error or where respondent concedes a substantive issue.
