Tax Court Under Scrutiny


10044552In April 2015, the Indiana Supreme Court ordered the creation of the Ad Hoc Tax Court Advisory Task Force to review the Indiana Tax Court’s resources, caseload, performance and operations. In May of 2015, the General Assembly passed legislation calling for the Indiana Judicial Center to conduct a like review and submit a report to the Legislative Council by December 1, 2016. The Supreme Court subsequently amended its order to have the task force submit its report to the Judicial Center and the Legislative Council by May 1, 2016.

In April 2016, the task force issued its findings and recommendations along with a report compiled by the National Center for State Courts (NCSC), which was contracted to assist the task force. These materials are now getting some attention and are definitely worthy of examination. The nine-member task force was chaired by Court of Appeals Judge James S. Kirsch. The members include a variety of experienced tax practitioners as well as the general counsel for the Department of Revenue and chief deputy for the Office of Attorney General. Tax Court Judge Martha B. Wentworth also participated as an “ex officio” liaison and attended meetings by invitation from the chair.

The NCSC researched the Court’s caseload, staffing and timeliness. It also interviewed stakeholders and conducted a survey seeking opinions on these subjects and on the perceived timeliness, fairness and demeanor of the Court. And it looked into case management, internal procedures and administrative practices. The statistical results, observations and recommendations are all set out in the report. The survey results evidence a contrast in opinions between the government responses and taxpayer responses regarding the quality of service provided by the Tax Court.

In short, it seems that the government representatives are significantly less satisfied with the Court. Not unrelated to their disgruntlement, it was noted in the preface to the findings that the Department of Revenue and attorney general members of the task force sought recommendations to review the very structure of the Court, recommending review of the de novo hearing process and the lack of automatic appeal rights. However, the majority of the group and the chair found these matters “outside the purview of the task force’s directive.”

Several things were apparently deliberated and no specific findings or recommendations were made. Ultimately, the task force’s primary finding was that after 30 years, the existence of the Tax Court still serves its initial purposes of providing tax expertise, tax law consistency and renders fair and thoughtful opinions.

The findings do focus on the need for continued progress in timely addressing pending cases and the utilization of resources and staff. The report recommends an ongoing review and suggests the Tax Court explore several reforms to its case management practices, including ruling on some matters without oral arguments, limiting discovery, requiring the Department of Revenue to certify a complete audit file (to avoid it having to be reconstructed) and referring some cases to mediation.

The findings and recommendations, NCSC report and other materials are available online.

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