Tax Court Must Leave Opening for Late Suits Over IRS Bills (1)

The US Tax Court must consider equitable reasons for allowing late lawsuits challenging IRS tax bills to go forward, a federal appeals court ruled Wednesday.

The decision of the US Court of Appeals for the Third Circuit only binds the Tax Court in cases appealable to that court, which covers Pennsylvania, New Jersey, and Delaware. Nonetheless, it was a sharp rebuke of the Tax Court’s unanimous decision in a separate case in November, Hallmark Research Collective v. Commissioner.

“Missing a statutory filing deadline is never ideal for the filer,” wrote Judge Thomas L. Ambro. “But the specific consequence for ...