Taxpayer losses.

• Author: Markman, Carol
• Position: Tax Practice & Procedures

The Tax Court has supported the IRS's rulings against taxpayers in many equitable relief cases, including Madden, TC Memo 2006-4, Motsko, TC Memo 2006-17, and Lopez, TC Memo 2005-36. The Tax Court denied relief even though the taxpayers in the cases might suffer economic hardship.

The Tax Relief and Health Care Act of 2006 (TRAHCA '06) amended Sec. 6015 specifically to give the Tax Court jurisdiction to review innocent spouse cases claiming equitable relief and to suspend the statute of limitations while such claims are pending. This provision may change the dynamic in some of these cases.

Until the TKAHCA '06 was passed, Sec. 6015(e) gave taxpayers the option to petition the Tax Court to...