Taxpayers may challenge IRS expert’s valuation in gift tax case
November 30, 2016
Taxpayers may challenge IRS expert’s valuation in gift tax case. The U.S. Court of Appeals for the First Circuit has reversed in part a Tax Court decision that “misstated” the burden of proof in a gift tax case and improperly refused to allow the taxpayers to challenge an IRS expert’s valuation report. The report had served as the basis of the taxpayers’ disputed tax liability. The appeals court found that the taxpayers’ burden is simply to show that the IRS’s assessment against them is erroneous and, if so, the Tax Court must then determine the correct amount.