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Idaho State Tax Commission Appeal

Introduction

The material on this web page is only a general outline concerning the Idaho Board of Tax Appeals and the process by which to appeal certain decisions of the Idaho State Tax Commission. The information contained in this pamphlet is not intended to provide readers with everything they may need to know regarding the appeal process. It is a party’s obligation to be informed and prepared for the appeal hearing or any other Board proceeding. You are encouraged to acquaint yourself with the governing procedures and rules in preparation for your appeal hearing.

The Idaho Board of Tax Appeals (BTA) is comprised of three members appointed by the Governor. Members serve in staggered three-year terms. Board members work in a part-time capacity, however are supported by full-time staff in the agency’s Boise office. To guarantee impartiality in decision-making, the BTA is a fully independent and distinct body, separate from the Idaho State Tax Commission and Idaho’s 44 counties.

The BTA hears property valuation and exemption cases, as well as matters involving state taxation, such as income and sales tax. The BTA also hears appeals regarding property tax reduction benefits. A separate information pamphlet is available for appeals concerning a decision of a County Board of Equalization.

The Board is balanced both in terms of professional experience and political affiliation. By law, no more than two members can be of the same political party. Board members are selected on the basis of their knowledge of, and experience in, taxation. In addition, members and staff receive judicial training to aid in their service as administrative law judges for the BTA.

Hearings are generally held in the county in which the taxpayer resides. In most instances, a hearing is presided over by one Board member or one staff hearing officer. Hearings typically do not exceed one hour and afford each party the opportunity to present the information they wish to be considered, and the chance to ask questions of the opposing party. More detailed information concerning hearings, including how to prepare for hearing, can be found in SECTION 4.

Who may file an appeal?

Generally, it is the taxpayer who appeals a final tax determination to the Idaho Board of Tax Appeals (BTA). This includes decisions regarding most tax types of the Idaho State Tax Commission. However, an appeal concerning corporate income tax, in which the amount asserted is greater than $25,000, must be filed with the district court.

Why file an appeal with the BTA?

Anyone adversely affected by a final tax determination has a right to appeal. An appeal may be filed with either the district court or the BTA. Many choose to file an appeal with the BTA because there are no filing fees and the BTA’s proceedings are less formal than district court.

How do I file an appeal?

An appeal from a decision of the Idaho State Tax Commission can be mailed or hand-delivered to the BTA’s Boise office. Appeals may not be faxed. For a mailed appeal, the postmark cancellation stamp on the envelope is the filing date for purposes of determining whether the appeal is timely filed. If an appeal is correctly mailed within the applicable timeframe it is considered timely, regardless of when the appeal is actually received by the BTA.

When must I file an appeal?

The deadline for appealing a final decision of the Idaho State Tax Commission is 91 days from the date of receipt of the agency’s written decision. However, appeals concerning the property tax reduction benefit program must be filed within 30 days of the date the decision or notice to change benefits was issued.

What is needed to file an appeal?

Before an appeal may be heard by the BTA it must be perfected. In general terms, a perfected appeal is one filed within the prescribed timeframe which also includes the items detailed on the following page. With the exception of a property tax reduction appeal or a refund claim, the taxpayer must deposit 20% of the asserted deficiency with the Idaho State Tax Commission, and include proof of such deposit when the notice of appeal is filed with the BTA. Appeal forms are available on the BTA’s website or may be requested directly from the BTA. Using an appeal form is not mandatory, however, the appeal form may is often helpful in complying with the filing requirements.

Appeals from the Idaho State Tax Commission

The following items are required to appeal a decision of the Idaho State Tax Commission:

1. Taxpayer’s name, mailing address, and telephone number.

2. The tax year(s) associated with the appeal.

3. A signed statement by the taxpayer or by a qualified representative attesting the notice of appeal contents are correct. Appeals filed by an attorney representing the taxpayer must also include the attorney’s name, address, telephone number, and Idaho State Bar license number. See SECTION 4 for more information regarding representation.

4. A complete copy of the written decision issued by the Idaho State Tax Commission, including the certificate of service.

5. A summary of taxpayer’s objections or arguments against the decision of the Idaho State Tax Commission and the basis for such objections or arguments.

6. A statement of the amount in dispute for each tax year appealed, or the amount of property tax reduction benefit sought.

7. Documentation showing the 20% prepayment requirement has been satisfied. An appeal of an Idaho State Tax Commission decision requires the taxpayer to deposit 20% of the asserted deficiency with the Idaho State Tax Commission. Attaching a receipt from the State Tax Commission is sufficient to prove this requirement has been satisfied. The deposit will be refunded with interest if the decision of the BTA is favorable to the taxpayer. An appeal regarding a tax refund claim or a property tax reduction does not require a deposit.

Acknowledgment Letter

After an appeal is received by the Board of Tax Appeals (BTA), an acknowledgment letter will be mailed to the parties within 14 days. If the appeal does not appear to be perfected, the acknowledgment letter may request additional information. The date of the acknowledgment letter is the effective date of the appeal for purposes of calculating the timeliness of certain subsequent motions. See the BTA’s procedural rules for more information.

Notice of Hearing

When a perfected appeal is received, a hearing will typically be scheduled within 90 days. A written Notice of Hearing will be mailed to the parties or their qualified representatives at least 20 days prior to the date of hearing. The Notice of Hearing will include the date, time, place, and other instructions for the hearing. The preferred form of hearing is an in-person hearing, however, in some instances a telephone hearing may be scheduled. When a telephone hearing is scheduled, the Notice of Hearing will include instructions regarding how to "attend" the hearing.

The Hearing

Hearings are normally conducted by a single presiding officer, which may be one of the Board members or one of the agency’s staff hearing officers. The presiding officer will be specified in the Notice of Hearing. Hearings often do not exceed one hour in length, however, complex appeals or those with multiple issues, may require a longer hearing. At hearing, each party will have a full opportunity to present his or her respective cases. The parties will also be allowed to ask questions of one another. Generally, the close of the hearing also represents the close of the record. The information provided by the parties at hearing is then submitted for review and decision-making by the full Board. For more information regarding hearings, hearing procedures, or preparing for hearing, please refer to SECTION 4.

Final Decision and Order

After the hearing record has been reviewed, a Final Decision and Order will be issued. A final decision of the BTA requires the agreement of at least two Board members. All decisions on the merits are in written form and include findings of fact and conclusions of law. Final decisions of the BTA are valid and enforceable against the non-prevailing party, unless the decision is further appealed to district court.

After the Final Decision and Order

A non-prevailing party may request a reconsideration of a Final Decision and Order of the BTA, or a rehearing of the appeal. Any such request must be in writing and must be filed with the BTA within 10 days of the date of the final decision. The request must also be copied to the opposing party. Either party may also appeal a final decision of the BTA to district court. Certain filing requirements and time limits apply.

Purpose of Hearing

The Idaho Constitution requires an opportunity to challenge government actions or decisions affecting a person’s life, liberty, or property. In the context of the Board of Tax Appeals (BTA), taxpayers have the statutory right to contest most decisions of the Idaho State Tax Commission affecting a potential tax liability. The most important aspect of these appeal rights is due process, which in basic terms requires a taxpayer be provided adequate notice and a meaningful opportunity to be heard regarding a tax-related action or decision. Due process protections are embodied in the BTA’s hearing procedures and are critical in fulfilling the agency’s mission "to provide a fully independent and fair review of taxpayer appeals."

The purpose of the hearing is to create the full record to be used later for decision-making purposes. The hearing is the parties’ primary opportunity to present evidence, testimony, and any other relevant information concerning the issue(s) on appeal. Hearings are usually conducted by one Board member or staff hearing officer. Parties will be notified in writing of the date, time, and location of the hearing.

Hearings before the BTA are de novo, which is Latin for "anew". In basic terms, this means everything starts over. The parties are not bound by the evidence offered in prior hearings before the Idaho State Tax Commission. Rather, both parties have an opportunity to present any relevant evidence or information, regardless of whether such material was previously offered.

Preparing for Hearing

In an effort to present the "best case" possible, hearing participants are encouraged to spend time prior to hearing organizing the arguments and information they wish to put forth. An important part of this preparation is making sure there are enough copies of the documents a party plans to introduce at the hearing. The BTA requires each party to bring at least three (3) full sets of documents to be offered at hearing; one (1) original for the presiding officer, and one (1) copy for each party. It is also helpful to have exhibits arranged in the order in which the party intends to present them, and to include page numbers.

Parties are similarly encouraged to consider how their witnesses, if any, will participate in the hearing. The presiding officer may take some time prior to the start of hearing to coordinate with the parties regarding participation of witnesses. If a party intends to call multiple witnesses, it is recommended the party contact the BTA prior to hearing to ensure needed accommodations are in place.

Exhibits for Hearing

As previously noted, each party must bring 1 original and 2 copies of each exhibit to the hearing. Unless ordered by the BTA, there is no requirement to pre-file hearing exhibits.

Depending on the type of appeal, exhibits might vary in terms of form and substance. The following are examples for different appeal types. Please keep in mind the list of examples is not exhaustive.

Income, sales, and use tax appeals. Exhibits for these appeals might include a written narrative, a timeline or sequence of events regarding the particular tax issue, receipts, invoices, tax returns, statutes, rules, or judicial opinions, or letters from accountants, bookkeepers, or other tax professionals.

Property tax reduction appeals. Exhibits for these appeals might include a written narrative, a timeline or sequence of events, copy of the application, evidence of income, a list of medical expenditures, receipts for treatment or prescriptions, letters from doctors or other healthcare professionals, or other relevant information concerning qualification for the property tax reduction program.

Hearing Procedure

The following pages provide an outline of a typical BTA hearing, however, the presiding officer has the authority to alter hearing procedures as deemed necessary or appropriate in a particular case.

1. Opening the record

At the start of the hearing the presiding officer will introduce the appeal and explain the hearing procedures to the parties.

2. Appellant’s presentation

The Appellant (party bringing the appeal) will have an opportunity to present his or her case. Typically, the presentation is made without interruption.

3. Respondent’s cross-examination

At the conclusion of the Appellant’s presentation, the Respondent (opposing party) will be allowed to ask questions of the Appellant and/or the Appellant’s witnesses.

4. Respondent’s presentation

Once questioning ends, the Respondent will have an opportunity to present his or her case. Again, this will typically be done without interruption from the other party.

5. Appellant’s cross-examination

After the Respondent’s presentation has concluded, the Appellant will be allowed to ask questions of the Respondent and/or the Respondent’s witnesses.

6. Appellant’s rebuttal

Following the Appellant’s questioning period, the Appellant will be able to present rebuttal arguments or statements.

7. Respondent’s rebuttal and closing statement

The Respondent will have an opportunity to present any rebuttal and to offer a closing statement.

8. Appellant’s closing statement

As the party with the burden of proof, the Appellant is afforded the last opportunity to present at the hearing.

9. Closing the record

After the Appellant has finished closing statements, the presiding officer will normally close the record. The matter is then considered submitted for review and decision-making. Once the record is closed, no additional evidence or information is permitted by either party, unless ordered otherwise by the BTA.

REPRESENTATION AT HEARING

An important legal principle is representation. The Idaho Supreme Court has held hearings before an administrative agency such as the BTA are legal proceedings, and are therefore subject to the rules governing the practice of law in Idaho. Depending on who the Appellant or Respondent is, there are certain restrictions regarding qualified representation. It is important to remember the rules of representation apply not just to the hearing, but in all aspects of the appeal process, including the initial filing of the appeal. A defective signature on the notice of appeal may result in dismissal of the appeal.

The following material outlines the BTA’s rules of representation, which can also be found in IDAPA 36.01.01.030. Any questions related to representation or witness participation should be brought to the BTA’s attention prior to hearing.

The following individuals are authorized to appear and practice before the BTA.

Natural Persons. A natural person may represent himself or herself, or be represented by an Idaho-licensed attorney.

Corporations. Duly authorized directors or officers of corporations representing the corporations for which they are directors or officers.

Limited Liability Companies (LLCs). A duly authorized member, or a manager of a manager-managed LLC, for which they are a member or manager.

Partnerships, Joint Ventures, and Trusts. Duly authorized partners, joint venturers, or trustees representing their respective partnership, joint venture, or trust.

Attorneys. Attorneys licensed to practice law in the State of Idaho.

Public Officers. Public officers or designated representatives when representing the governmental agency.

Witnesses. An Individual not fitting the above classes of authorized representatives may participate at the hearing as a fact witness. A witness may assist in the presentation of a party’s case at the hearing, but is not allowed to cross-examine the opposing party. Common examples of witnesses include certified public accountants, bookkeepers, tax preparers, neighbors, friends, family members, or any other appropriate individual with relevant knowledge of, or information concerning, the appeal.

DISCLAIMER: The following questions and answers are provided for general information only and may not be completely accurate in every circumstance. Further, the information in this section is not to be construed as legal advice, and is not intended to be legally binding on the BTA.

Q: What does the Board of Tax Appeals (BTA) do?

A: The BTA provides taxpayers with an opportunity to appeal decisions of county boards of equalization and most tax decisions of the Idaho State Tax Commission to an independent decision-making body. Taxpayers may present evidence and argument at a hearing before the BTA.

Q: When and how can I file an appeal with the BTA?

A: An appeal of a decision of the Idaho State Tax Commission when allowed by Idaho Code § 63-3049 may be filed after such decision is received by the taxpayer. Certain requirements must be satisfied and limited time periods apply. More information regarding filing requirements can be found in SECTION 2. Appeal forms are available at the BTA’s website (bta.idaho.gov) or by request to the BTA’s Boise office.

Q: What happens after I file my appeal?

A: The BTA will send an acknowledgment letter within 14 days to notify all parties the appeal has been received. The acknowledgment letter will include the docket number assigned to the appeal and may request further information. At a later time, the parties will be notified by mail of the date, time, and place of the hearing.

Q: What kind of information should I present at the hearing?

A: Generally, each party will be allowed to present information they feel is relevant to the appeal. This could include receipts, invoices, tax returns, copies of relevant communications, or other documents which might be helpful or informative. Parties should provide as much relevant information and legal argument as possible. Personal testimony and that of witnesses may also be offered as evidence. See SECTION 4 for more information regarding exhibits for hearing.

Q: What happens at the hearing?

A: The hearing is the parties’ opportunity to present their respective cases. Each party will have a full opportunity to be heard and will be allowed to ask questions of the opposing party. The goal of the hearing is to create the record, or body of evidence, the BTA will rely on in making its decision. The presiding officer is responsible for controlling all aspects of the hearing to ensure the parties receive a fair hearing. The hearing will be digitally recorded to provide an accurate audio record.

Q: May I pursue a settlement after my appeal has been filed?

A: Yes, a settlement can be pursued any time prior to the BTA issuing a final decision. To become effective, a settlement agreement must be submitted to, and approved by, the BTA. A settlement agreement must be signed by both parties, or their qualified representatives, and needs to include the relevant terms of the agreement.

Q: Do I need to re-submit exhibits or information I provided previously to the Idaho State Tax Commission?

A: Yes, any information the parties would like the BTA to consider should be provided at the BTA hearing, regardless if the same information was a part of a prior proceeding before the Idaho State Tax Commission. Hearings before the BTA are de novo, which in simple terms means everything starts "fresh". Likewise, any information included in the materials submitted when filing the appeal should be re-introduced at the BTA hearing.

Q: How long will it take to receive my decision?

A: The time it takes to receive a decision can vary, however this type of BTA decision is typically issued within a couple months.

Q: Can I get information from the opposing party before the hearing?

A: Yes. The formal process is called discovery. There are specific time limits and other standards for filing a discovery request, which can be found in the BTA’s administrative rules. Formal discovery must be requested in writing and granted by the BTA. Informal communication between the parties is permitted at any time, however, the opposing party is not always required to participate or provide information during this informal process.

Q: Who will be at the hearing? Is it public?

A: Each party is present, as is the presiding officer from the BTA. Typically, there are 3 to 5 total people at the hearing. Almost all hearings are open to the public.

Q: Where will the hearing be held?

A: Hearings regarding appeals of Idaho State Tax Commission decisions are generally conducted in a location near the taxpayer’s residence or place of business.

Q: Why do I need to prepay 20% to appeal a decision of the Idaho State Tax Commission?

A: Idaho Code § 63-3049 requires a taxpayer to deposit 20% of the amount asserted with the Idaho State Tax Commission before filing an appeal with the BTA. The "amount asserted" refers to the total deficiency, including interest and penalty, indicated in the decision of the State Tax Commission. You must include proof to show the 20% payment was deposited with the State Tax Commission when you file an appeal with the BTA. A receipt attached to the appeal will satisfy the proof of payment requirement. There is no waiver or exception to the 20% prepay requirement. The deposit will be refunded with interest if the decision of the BTA is favorable to the taxpayer.

Q: Can my accountant represent me at the BTA hearing?

A: No, you may not be represented by a third-party non-attorney in a hearing before the BTA. Your accountant may serve as a witness in the hearing, however, he or she will not be allowed to cross-examine the opposing party, or witnesses, if any. For more information regarding representation, please refer to SECTION 4.

Q: Can I appeal my BTA decision?

A: Yes, a final decision of the BTA may be appealed to district court. Certain filing requirements and time limits apply, as provided in Idaho Code § 63-3812 and the Idaho Rules of Civil Procedure (Rule 84).

Q: What information does the BTA receive from the Idaho State Tax Commission concerning my appeal after it has been filed?

A: In simple terms, nothing. The Idaho State Tax Commission does not forward any information to the BTA, including anything you have previously provided to the Tax Commission. Any information you wish the BTA to consider must be submitted directly to the BTA at the hearing, or prior to hearing if ordered by the BTA.

It is hoped the material in this web page was helpful to the reader in explaining and navigating the appeal process of the BTA. For matters not included on this web page or any other questions regarding the BTA, please feel free to contact us at 208-334-3354.

The Idaho Board of Tax Appeals is committed to providing convenient, equitable, and independent determinations of disputed tax matters. We are always looking for ways to improve the services and the overall experience for those appearing before the BTA. In this regard, the BTA welcomes feedback and suggestions for improvement from participants.

If you would like to comment on an aspect of the BTA’s service, or your particular experience with the BTA, you are encouraged to visit the feedback/survey section on our website at bta.idaho.gov. Alternatively, written comments can be mailed to the BTA at 1673 W. Shoreline Drive, Suite 120, Boise, ID 83702.

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