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Appeal of Tax Cases: Potential Pitfalls and Procedural Issues

Mary A McNulty and Leonora Meyercord

Summary

  • This article sets forth the timetable and steps for the appeal of a tax case from both the U.S. Tax Court, the federal district courts, and the U.S. Court of Federal Claims.
  • Explores strategies for taxpayers in appealing adverse tax decisions.
  • Discusses key considerations in appealing to higher courts.
  • Provides insights into the nuances of tax appeals for practitioners and taxpayers.
Appeal of Tax Cases: Potential Pitfalls and Procedural Issues
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This article sets forth the timetable and steps for the appeal of a tax case from both the U.S. Tax Court (Tax Court), the federal district courts, and the U.S. Court of Federal Claims (CFC).Depending on the court from which the appeal is taken, some significant differences exist. These differences can lead to serious pitfalls, such as the failure to timely file a notice of appeal. More often, the procedural requirements for an appeal are the same, regardless of the court from which the appeal is taken, and have the same potential pitfalls. These pitfalls are highlighted in the chart below and discussed in the accompanying footnotes. The footnotes also describe in more detail the steps of an appeal.

Events

Entry of Decision (Tax Court) or Judgment (District Court)

Deadline Tax Court Appeal

Upon entry of order in Tax Court records specifying amount of deficiency, dismissal of case, or declaratory judgment

Deadline District Court Appeal

Upon entry of judgment by clerk on civil docket

Potential Pitfalls and Procedural Issues

Final Decisions Only
Multi-Claim Petitions

Posting of Appeal Bond

Deadline Tax Court Appeal

On or before the filing of the Notice of Appeal

Deadline District Court Appeal

Not likely required

Potential Pitfalls and Procedural Issues

Failure to post bond allows IRS to assess and collect deficiency determined by Tax Court

Filing of Notice of Appeal

Deadline Tax Court Appeal

90 days after entry of Tax Court’s decision

Deadline District Court Appeal

60 days after entry of district court judgment

Potential Pitfalls and Procedural Issues

Longer period than normal for appeal from district court because case involves the United States.

  • Decision to Appeal
  • Method of Filing
  • Post-Judgment Motions
  • Filing in Wrong Court
  • Cross Appeals
  • Joint or Consolidated Appeals
  • No Automatic Voluntary Dismissal

Serving of Notice of Appeal

Deadline Tax Court Appeal

Service is made by the Tax Court clerk

Deadline District Court Appeal

Service is made by the district court clerk19

Potential Pitfalls and Procedural Issues

Court’s failure to serve notice of appeal does not affect validity of appeal

Docketing of Appeal in Circuit Court

Deadline Tax Court Appeal

Upon receipt of copy of notice of appeal and of docket entries from Tax Court clerk

Deadline District Court Appeal

Upon receipt of copy of notice of appeal and of docket entries from district court clerk

Potential Pitfalls and Procedural Issues

No Automatic Voluntary Dismissal

Appellant orders Transcript and files Statement of Issues

Deadline Tax Court Appeal

14 days after later of filing Notice of Appeal or entry of order disposing of certain post-judgment motions

Deadline District Court Appeal

14 days after later of filing Notice of Appeal or entry of order disposing of certain post-judgment motions25

Potential Pitfalls and Procedural Issues

Transcript is already on file in most Tax Court cases and does not need to be ordered

Court Reporter files Transcript with Tax Court or District Court

Deadline Tax Court Appeal

30 days after receiving order for transcript26

Deadline District Court Appeal

30 days after receiving order for transcript26

Potential Pitfalls and Procedural Issues

The court reporter may request more time, which will lengthen the period of the appeals process.

Transmittal of Record to Circuit Court

Deadline Tax Court Appeal

Upon completion of the record

Deadline District Court Appeal

Upon completion of the record28

Potential Pitfalls and Procedural Issues

Assembly of voluminous lower court record may lengthen the period of the appeals process

Filing of Brief of Appellant (30 pages; 13,000 words or 1,300 lines) plus appendix

Deadline Tax Court Appeal

Within 40 days after record is filed or per the Circuit Court’s briefing schedule

Deadline District Court Appeal

Within 40 days after record is filed or per the Circuit Court’s briefing schedule31

Potential Pitfalls and Procedural Issues

  • Standard of Review
  • Failure to File

Filing of Brief of Appellee (30 pages; 13,000 words or 1,300 lines)

Deadline Tax Court Appeal

Within 30 days after service of appellant’s brief

Deadline District Court Appeal

Within 30 days after service of appellant’s brief35

Potential Pitfalls and Procedural Issues

Failure to File

Filing of Appellant’s Reply Brief (15 pages; 6,500 words or 650 lines)

Deadline Tax Court Appeal

Within 21 days after service of appellee’s brief but at least 7 days before argument

Deadline District Court Appeal

Within 21 days after service of appellee’s brief but at least 7 days before argument38

Potential Pitfalls and Procedural Issues

Oral Argument

Deadline Tax Court Appeal

Calendared based on circuit court’s calendaring priorities

Deadline District Court Appeal

Calendared based on circuit court’s calendaring priorities

Potential Pitfalls and Procedural Issues

Oral argument is not always granted.

Issuance of Opinion

Deadline Tax Court Appeal

Following oral argument

Deadline District Court Appeal

Following oral argument

Potential Pitfalls and Procedural Issues

Judgment may be rendered without an opinion.

Entry of Judgment

Deadline Tax Court Appeal

Following receipt of opinion by clerk

Deadline District Court Appeal

Following receipt of opinion by clerk41

Potential Pitfalls and Procedural Issues

Finality of Decision

Prevailing Party files Bill of Costs

Deadline Tax Court Appeal

14 days after entry of judgment

Deadline District Court Appeal

14 days after entry of judgment44

Objections to Bill of Costs

Deadline Tax Court Appeal

14 days after service of the bill of costs

Deadline District Court Appeal

14 days after service of the bill of costs45

Filing of Petition for Rehearing or for Rehearing En Banc

Deadline Tax Court Appeal

45 days after entry of judgment

Deadline District Court Appeal

45 days after entry of judgment47

Potential Pitfalls and Procedural Issues

Longer period than normal because case involves the United States
No response or answer filed

Issuance of Mandate to lower court

Deadline Tax Court Appeal

Later of (i) 7 days after expiration of time for filing petition for rehearing or (ii) 7 days after entry of order denying petition for rehearing, rehearing en banc, or motion for stay of mandate

Deadline District Court Appeal

Later of (i) 7 days after expiration of time for filing petition for rehearing or (ii) 7 days after entry of order denying petition for rehearing, rehearing en banc, or motion for stay of mandate

Filing of Petition for Writ of Certiorari (9,000 word limit)

Deadline Tax Court Appeal

Later of (i) 90 days after entry of judgment or (ii) 90 days after petition for rehearing is denied or (iii) if petition for rehearing is granted, 90 days after subsequent judgment is entered

Deadline District Court Appeal

Later of (i) 90 days after entry of judgment or (ii) 90 days after petition for rehearing is denied or (iii) if petition for rehearing is granted, 90 days after subsequent judgment is entered54

Potential Pitfalls and Procedural Issues

  • Time runs from the date of the entry of judgment, not from the issuance date of the mandate
  • Extension of time to file for good cause

Filing of Brief in Opposition to Petition for Writ of Certiorari (9,000 word limit)

Deadline Tax Court Appeal

30 days after case is placed on the docket, unless extended

Deadline District Court Appeal

30 days after case is placed on the docket, unless extended58

Potential Pitfalls and Procedural Issues

Opposition brief is optional unless ordered by the court

Filing of Reply to Brief in Opposition (3,000 word limit)

Deadline Tax Court Appeal

No deadline specified, but distribution to and consideration by the Supreme Court will not be delayed pending receipt of the reply brief

Deadline District Court Appeal

No deadline specified, but distribution to and consideration by the Supreme Court will not be delayed pending receipt of the reply brief

Potential Pitfalls and Procedural Issues

Reply brief is optional

Distribution to U.S. Supreme Court

Deadline Tax Court Appeal

10 days after brief in opposition is filed

Deadline District Court Appeal

10 days after brief in opposition is filed62

Disposition of Petition for Writ of Certiorari

Deadline Tax Court Appeal

After consideration of petition and briefs

Deadline District Court Appeal

After consideration of petition and briefs64

Potential Pitfalls and Procedural Issues

U.S. Supreme Court rarely grants petitions for writs of certiorari in tax cases, even when U.S. is the party filing the petition

Filing of Petition for Rehearing of Order denying Petition for Writ of Certiorari

Deadline Tax Court Appeal

25 days after date of order of denial

Deadline District Court Appeal

25 days after date of order of denial66

Potential Pitfalls and Procedural Issues

No response unless requested by the court.

Filing of Merits Brief and Joint Appendix by Petitioner

Deadline Tax Court Appeal

45 days after order granting writ

Deadline District Court Appeal

45 days after order granting writ68

Filing of Merits Brief by Respondent

Deadline Tax Court Appeal

30 days after petitioner’s brief is filed

Deadline District Court Appeal

30 days after petitioner’s brief is filed69

Filing of Reply Brief by Petitioner

Deadline Tax Court Appeal

30 days after respondent’s brief is filed

Deadline District Court Appeal

30 days after respondent’s brief is filed70

Potential Pitfalls and Procedural Issues

Brief must be received at least one week before oral argument.

Oral Argument

Deadline Tax Court Appeal

At least two weeks after due date of respondent’s merits brief

Deadline District Court Appeal

At least two weeks after due date of respondent’s merits brief71

Potential Pitfalls and Procedural Issues

Brief must be filed on behalf of a party before that party can appear at oral argument

Issuance of Opinion

Deadline Tax Court Appeal

Released immediately upon announcement from the bench

Deadline District Court Appeal

Released immediately upon announcement from the bench73

Entry of Judgment

Deadline Tax Court Appeal

Following receipt of opinion by clerk

Deadline District Court Appeal

Following receipt of opinion by clerk

Potential Pitfalls and Procedural Issues

Finality of Decision

Petition for Rehearing

Deadline Tax Court Appeal

25 days after entry of judgment or decision

Deadline District Court Appeal

25 days after entry of judgment or decision75

Potential Pitfalls and Procedural Issues

No response unless requested by the court.

Issuance of Mandate

Deadline Tax Court Appeal

Following entry of judgment

Deadline District Court Appeal

Following entry of judgment76

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