tax court; direct appeals
HB 2244 will provide taxpayers that dispute their income or transaction privilege (sales) or use tax the option to go directly to tax court before exhausting administrative appeals. This bill contains a strike-everything amendment on the same subject.
Current law treats appeals for property tax, income tax and transaction privilege tax differently. Taxpayers that have a property tax dispute currently have the option to go directly to tax court or pursue an administrative appeal. Individual income tax disputes must first appeal to the director of DOR, but then have the option of appealing to the state board of tax appeals (BOTA) or to tax court. (Individual income tax disputes that are less than $5,000 cannot appeal the DOR director’s decision to tax court unless they first appeal to BOTA.) Transaction privilege and use tax disputes are currently appealed through the Office of Administrative Hearings. If a decision of OAH is appealed, it must then go back to DOR, then to BOTA before appealing to tax court.
The proposed strike-everything amendment will transfer the transaction privilege and use tax appeals back to DOR. The appeals will then be treated the same as individual income tax appeals. Current law will then allow all decisions of DOR the option to further appeal either to BOTA or directly to tax court. Therefore, the effect of the amendments, although not specifically stated, will allow taxpayers the option to go directly to tax court without first exhausting administrative appeals.