What happens when the court makes a mistake in issuing its decision?  What recourse is available to the parties concerned?  Does the court vacate its decision and reissue a correct decision, or is there an easier way to rectify the problems?

In Seven W. Enters. Inc. v. Comr.,No. 12-02099 (7^th Cir. 7/24/13), two corporations, S and H, challenged tax deficiencies issued by the IRS.  The Tax Court found both corporations liable for certain deficiencies related to certain tax years, however when the decisions were issued, the court inadvertently attributed S’s tax liability to H, and H’s tax liability to S.  The IRS filed a motion to have the decisions vacated and reissued, and while the corporations did not object to correcting the errors, they did object to the vacatur of the decisions, possibly concerned that the IRS could circumvent the statute of limitations (see “Seventh Circuit: Absent Fraud, Tax Court Does Not Have Authority to Vacate Decisions,” (143 DTR K-1, 7/25/13)). 

The Seventh Circuit Court of Appeals held that the Tax Court does not have the authority to vacate a decision that has become final absent a showing of fraud on the court.  The circuit court ordered the Tax Court to issue separate orders amending the original decision to correct the errors.