Refund Litigation, written by Theodore D. Peyser, Esq., of Roberts & Holland, analyzes the process of filing and litigating a refund suit in a federal district court or the Court of Federal Claims.  

This Portfolio considers the problems that arise in instituting and prosecuting a refund suit, from filing the refund claim through the satisfaction of a favorable judgment. Written to inform taxpayers who believe that they have overpaid their taxes, for whatever reason, of the actions they must take to recover the overpayment, it discusses the pertinent jurisdictional and procedural rules in both the federal district courts and the Court of Federal Claims and provides a detailed analysis of the factors common to tax refund actions that should be weighed in making the choice of forum. 

A taxpayer who believes the IRS has erroneously determined his/her federal tax liability can turn to three different courts to correct the error. In the case of a notice of deficiency regarding income, estate and gift taxes, and certain excise taxes, a taxpayer can file suit in the Tax Court and defer payment until a final decision. Alternatively, the taxpayer can pay the tax as determined by the IRS, file a claim for refund, and, if the claim is not allowed, sue for a refund in a federal district court or the Court of Federal Claims.

Once a taxpayer has decided to file a claim for refund, this Portfolio may be consulted for the procedural, technical, and tactical aspects of filing a proper claim and, if disallowed, the essentials of prosecuting a suit for refund.  In addition to providing the analysis of the pertinent statutes, regulations, and decisions, this Portfolio contains practical advice and observations that may prove helpful in securing a favorable judgment or settlement.

Refund Litigation allows you to benefit from:

• Hundreds of hours of original research on specific tax planning topics from leading practitioners in this area
• Invaluable practice documents including tables, charts and lists
• Plain-English guidance from world-class experts
• Real-world and in-depth analysis that lets you explore various options
• Time-saving access to relevant sections of tax laws, regulations, court cases, IRS documents and more
• Alternative approaches to both common and unique tax scenarios 

This Portfolio is part of the U.S. Income Portfolios Library, a comprehensive series that includes more than 200 Portfolios, which covers every federal tax topic with expert, in-depth analysis, and offer commentary on a wide range of federal taxation topics, including Compensation Planning, Deductions and Credits, Partnerships and Corporations, Special Pass-Through Entities, Corporate Reorganizations, Real Estate, Procedure and Administration, and more. 

Detailed Analysis

I. Introduction

II. Evolution of the Tax Refund Suit

III. Jurisdictional Prerequisites

Introductory Material

A. The Full Payment Requirement

1. Tax

2. Interest and Penalties

a. Interest

b. Penalties

3. Installments

B. The Timely Filed Claim Requirement

1. The Time Limits

a. Limitations Period for Filing Refund Claim

b. Limitations on Amount of Refund

c. Refund of Additional Assessment

d. Effects of Extensions

e. Equitable Tolling for Financial Disability

f. Special Limitations Rules

2. The Place and Manner of Filing

a. Timely Mailing/Timely Filing

b. Electronic Postmarks

c. Designated Private Delivery Service

d. Presumption of Delivery

3. Formal Requirements

a. Claims for Income Tax

b. Claims Filed by an Employer for Refund of FICA or RRTA Taxes

c. Claims for Refunds of Air Transportation Excise Taxes

d. Claim for Missing Refund Check

e. Claims for Arbitrage Overpayments on Exempt Bonds

4. Informal Claims

a. Qualifying Informal Claims

b. Nonqualifying Informal Claims.

5. The Variance Defense

6. Amending a Claim After the Statute Has Run

C. Limitations on Filing Suit

D. The Preclusive Effect of a Tax Court Decision

IV. Choice of Forum

A. The Applicable Precedent

B. The Judges

C. Jury Trials

D. Prepayment of Tax and Interest Rules

E. Discovery and Other Procedural Considerations

1. Depositions

2. Experts

3. Other Procedures

F. The Attorneys Representing the Government

G. Test Cases

V. Procedural Doctrines

A. Res Judicata

B. Collateral Estoppel

C. Nonmutual Collateral Estoppel

D. Equitable Recoupment

E. Equitable Estoppel

1. Estoppel Against a Taxpayer

2. Estoppel Against the Government

F. Judicial Estoppel

G. Class Actions

H. Act-of-State Doctrine

VI. Initiation of a Refund Suit

A. Jurisdiction

B. Standing

C. Venue

D. Preparing and Filing the Complaint

1. District Court Suits

2. Court of Federal Claims Suit

VII. Pretrial Procedure

A. Scheduling Orders

B. Discovery from the Government

1. IRS Administrative File Regarding Periods in Question

2. Section 6103 Return Information

3. Ruling and Regulations Back-up Files

4. Freedom of Information Act Requests

C. Failure to Disclose

D. Additional Deficiency Procedure

E. Pretrial Submissions

VIII. Summary Judgment Practice

Introductory Material

A. Basic Rules

B. The Moving Party's Initial Burden

C. The Moving Party's Burden of Persuasion

D. Rule 56(e) Affidavits

IX. Settlement

Introductory Material

A. Authority to Settle

B. The Role of Chief Counsel

C. Negotiation of an Offer

D. Alternate Dispute Resolution Techniques

1. Department of Justice Policy

2. Court of Federal Claims Procedures

3. Binding Arbitration

4. District Court Procedures

X. Trials

A. Burden of Proof Rules

B. Offsets

C. Witnesses

1. Attendance of Witnesses

a. Service in Federal District Courts

b. Service in Court of Federal Claims

2. Expert Witness

D. Jury Trials

E. The Clearly Erroneous Rule

XI. Judgments, Costs, and Fees

A. Entry of Judgment

B. Costs Under 28 USC § 1920

C. Section 7430 Attorney's Fees and Costs

1. Eligibility for an Award

2. Determining the Amount of the Award

3. Applying for an Award

4. Disposition by the District Court

D. Bad Faith Attorney's Fees

XII. Initiating an Appeal

A. The Notice of Appeal

B. Interlocutory Appeals

C. Writs of Mandamus

D. The Government Appeal Process

XIII. Satisfaction of Judgments Against the Government

Working Papers

Table of Worksheets

Worksheet 1 Form 1040X, Amended U.S. Individual Income Tax Return

Worksheet 2 Form 1120X, Amended U.S. Corporation Income Tax Return

Worksheet 3 Form 843, Claim for Refund and Request for Abatement

Worksheet 4 Sample Refund Complaint

Worksheet 5 Department of Justice Authority to Compromise and Close Civil Claims and Responsibility for Judgments, Fines, Penalties, and Forfeitures

Worksheet 6 Justice Department Final Rule With Tax Division Directive No. 135 on Settlement Authority for Various Court Sections, Offices, Attorney General Deputy Assistants

Worksheet 7 IRS Chief Counsel Directive Manual, Settlement Option Procedures General Litigation Cases from CCDM 34.8.1

Worksheet 8 Department of Justice Order No. 1109–85, 28 CFR Section 50.20

Worksheet 9 Tax Division Alternative Dispute Resolution Case Selection Criteria

Worksheet 10 United States Court of Federal Claims Second Amended General Order No. 40 and ADR Pilot Procedures

Worksheet 11 Executive Order 12998 of February 5, 1996, Civil Justice Reform

Worksheet 12 Appendix H to RCFC

Bibliography

OFFICIAL

Statutes:

Public Laws:

Legislative History:

Regulations:

Court Rules:

Local rules:

Treasury Publications:

Miscellaneous:

Treasury Procedures and Rulings:

Cases:

UNOFFICIAL

Miscellaneous:

Periodicals:

1993

1994

1999

2004

2005