Posted on 03/10/2005 7:16:59 PM PST by Conservative Goddess
Supreme Court: Tax Court Must Reveal Documents
AccountingWEB.com - Mar-9-2005 - The Supreme Court on Monday struck down a U.S. Tax Court practice that shields vital documents from participants in cases before the tax court as well as the federal judges who hear tax court appeals, the New York Times reported.
In an unusual move, the Supreme Court overturned rulings of two federal appeals courts, the Seventh Circuit in Chicago and the 11th Circuit in Atlanta. The Supreme Court usually only hears cases in which there is conflict in the lower courts.
Writing for the majority in the 7-2 decision, Justice Ruth Bader Ginsburg addressed the tax court's practice of using "special trial judges," auxiliary judges who conduct trials and make recommendations to the 19 regular judges on how major tax cases should be decided, the Times reported.
While the decisions of the special judges are not binding, their rulings "shall be presumed to be correct," and the regular judges are expected to defer to them, the Times reported. The reports are critical to the tax court's processes, but since 1983, the court has considered them to be confidential internal documents and has refused to provide them to the participants or appellate judges, the Times reported.
Chief Justice William H. Rehnquist filed a dissenting opinion, joined by Justice Clarence Thomas. "The tax court's compliance with its own rules is a matter on which we should defer to the interpretation of that court," Rehnquist said.
The decision was a posthumous victory for a prominent tax lawyer, Burton W. Kanter, who along with two other men was found liable for a $30 million tax deficiency in a case that dated to the 1970's. While the Supreme Court's decision did not overturn the tax court's 1999 finding against Kanter and the two others, the Times reported that the tax court will now have to show the documentation behind the adverse finding and will have to operate differently in the future. Kanter died in 2001.
The National Federation of Independent Businesses praised the decision. "Taxpayers fighting an unfair tax bill should have the tools and information needed to mount a fair fight," Karen Harned, of the business group's legal foundation, said in a statement.
Richard H. Pildes, a professor at New York University Law School who represented the Kanter estate, told the Times that the decision addressed "very, very fundamental issues about the basic structure of a trial."
Damn. I thought the SAME thinng. Hell must freezing over.
Damn. I thought the SAME thinng. Hell must be freezing over.
You'll generally find that the Chief Justice and Thomas have great faith in agencies and departments of the executive branch conducting themselves honorably. Just another reason that Thomas would make a terrible choice to replace Rehnquist.
Ping!
I swear. The plain words and ideals of the Constitution mean nothing anymore to these people.
Well I wouldn't go THAT far. Thomas would be excellent.
But you are prolly correct that Thomas may project his impeccable ethics (wrongly) on other government officials.
Craig Livingstone anyone?
There are special judges just to hear tax cases? This is news to me. Wow.
How can any court hearing, in any setting, be fair if documents are not available to the person brought before the court?
I'm a little baffled. This case began in the 70s and still has to go back to a lower court? The f44kee is dead and whoever the f44kor is still hasn't got his money? Only a tax lawyer would love this case as they slowly deplete the estate down to the level of a tootsie roll. Where did I go wrong?
Weird that the good guys would deny due process, eh?
This is an argument for a flat tax.
But Rehnquist agreed with Thomas on this decision. I concur with the majority so far that the tax court should make these matters public. But I can see what Rehnquist and Thomas are driving at. They think that, if this practice is wrong, then it should be corrected by the tax courts, or by the administration working through the IRS, or by congress, not by judicial fiat. And I can sympathize with that.
What I figure they were driving at was that, since the tax court is an Artile I court and not an Article III court, it should be allowed to conduct business as it wishes. ESPECIALLY since taxpayers bring cases before the tax court are choosing the tax court specifically as a venue. You don't have to bring cases before the tax court, you can bring them in district court (though there are different rules in the two courts as to whether or not you have to pay the IRS imposed tax beforehand or not).
Yup. Just think - the IRS has over 100,000 employees. If we went to a flat tax we could keep 10 and send the other 99,990 down to our southern border with Mexico.
Yeah, they would need water eventually, but they could still do duty as speed bumps.
lol.
Well, I would not want to go to VAT. And I would not the tax be so high as to kill consumption ( think the luxury boat tax)
But:
We would regain our privacy. We would save 2%+ of our GDP to fill out the forms AND we would expand the tax and courage more saving and investing.
lol.
Well, I would not want to go to VAT. And I would not the tax be so high as to kill consumption ( think the luxury boat tax)
But:
We would regain our privacy. We would save 2%+ of our GDP to fill out the forms AND we would expand the tax base and courage more saving and investing.
One of the few times I disagree with Rehnquist and Thomas.
I find whenever I have a disagreement with news reports about either, it behoves one to take a look at their quarrel with the majority opinion.
The sense I get from a quick reading of the dissent is that Rehnquist & Thomas hold the proper action would have been better served by an amendment to the court's procedural rules, rather than take the route of interpreting the rule away through a convoluted construction of its text and established practice.
Here's the opinion document, their dissent is on PDF page 33:
CLAUDE M.BALLARD,ET UX.,PETITIONERS 03 –184
v. COMMISSIONER OF INTERNAL REVENUE
DUCK! Who gave that pigs wings?
Was it not until recently that tax courts had to operate under the presumption of inoccence? Before you were presumed guilty when before a tax court.
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