How Facebook’s IRS tax case applies to us

Facebook’s multi-billion dollar tax case in the news today has implications for us ordinary tax-paying citizens. Two take-home lessons:

1. If you rely solely on the Taxpayer Bill of Rights without other statutory authority, then this adds a level of procedural risk to your dispute. We do routinely rely on these procedures and expectations of ‘fair play’ but there is still room for disagreement on specifically what procedures apply. Any tax professional, including myself, can cite examples of cases where IRS violated the Taxpayer Bill of Rights but in many cases it just isn’t practical for the taxpayer to litigate this specific matter.
2. While IRS is normally focused on resolving issues in the most expedient and usually informal manner, once a taxpayer files in US Tax Court their procedures change. Facebook learned that you can’t expect to have it both ways.

There are many taxpayers who have not taken full advantage of the options and procedures that are available to them in a tax dispute. I am pleased to discuss any specific case where representation may be appropriate.