Anyone can file claims in US District Court, the US Court of Federal Claims, bankruptcy court, or other venues.   Judge David Laro, friend of the appraisal profession and recent speaker at the NYSSCPA/FAE Business Valuation Summit, reminds us that there’s one main reason:  “you don’t have to pay your taxes first” to file a claim in US Tax Court. 

Where do these claims end up?  There are four levels of decision.   If they’re small (less than $50,000), they go to small claims, and have no precedential value.   The majority go to the second level—the Tax Court Memo.   “Mandalbaum was a TC memo,” says Laro.   Some of the 19 judges consider these cases to be precedential, but it’s not mandatory, so lawyers and experts need to know the judge they’re appearing before prior to citing TC memo cases (like Gross).  The third level of decision is the Tax Court Opinion, which is published by the Tax Court, and is binding on every judge.  The highest level of decision is the Reviewed Opinion, which is released in the rare cases where two Tax Court judges have conflicting decisions, or “in a case of great importance.”   One judge drafts an opinion, which is then sent to a conference of all judges until consensus is achieved.  BVR publishes Tax Court Memos, Tax Court Opinions, Reviewed Opinions, and provides analysis and abstracts.  Visit BVLibrary for more information.