Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 7 - Appeals, Taxpayer Representation, and Other Administrative Procedures › Rule 701-7.9 - Appeals

Current through Register Vol. 47, No. 3, July 24, 2024
Any person wishing to contest an assessment, denial of refund
				  claim, or any other department action, except licensing, which may culminate in
				  a contested case proceeding, shall file an appeal, in writing, with the
				  department within the time prescribed by the applicable statute or rule for
				  filing notice of application to the director for a hearing. The appeal must be
				  filed as described in rule
				  701-7.3 (17A).
(1)
Deadlines.
The period
				for appealing department action relating to refund claims is the same statutory
				period as that for contesting an assessment. Failure to timely file a proper
				appeal will be construed as a waiver of opposition to the matter involved
				unless, on the director's own motion, pursuant to statutory authority, the
				powers of abatement or settlement are exercised. The review unit may seek
				dismissal of appeals which are not in the proper form as provided by this rule.
				See subrule 7.12(2) for dismissals.
(2)
Appealing refund claims that have
				not been reviewed within six months.
If the department has not granted
				or denied a filed refund claim within six months of the filing of the claim,
				the refund claimant may file an appeal. Even though an appeal is so filed, the
				department is entitled to examine and inspect the refund claimant's records to
				verify the refund claim.
(3)
Paying assessment in order to appeal refund claim denial.
Notwithstanding the above, the taxpayer who fails to timely appeal an
				assessment may contest the assessment by paying the whole assessed tax,
				interest, and penalty, and filing a refund claim within the time period
				provided by law for filing such claim. However, in the event that such
				assessment involves divisible taxes which are not timely appealed, namely, an
				assessment which is divisible into a tax on each transaction or event, the
				taxpayer may contest the assessment by paying a portion of the assessment and
				filing a refund claim within the time period provided by law. In this latter
				instance, the portion paid must represent any undisputed portion of the
				assessment and must also represent the liability on a transaction or event for
				which, if the taxpayer is successful in contesting the portion paid, the unpaid
				portion of the assessment attributable to that specific type of transaction
				would be canceled. Any such appeal filed is limited to the issues covered by
				the amounts paid for which a refund was requested and denied by the department.
				Thereafter, if the department does not grant or deny the refund within six
				months of the filing of the refund claim or if the department denies the
				refund, the taxpayer may file an appeal as authorized by this rule.
(4)
Divisible taxes.
All of
				the taxes administered and collected by the department can be divisible taxes,
				except individual income tax, fiduciary income tax, corporation income tax,
				franchise tax, and statewide property tax. The following noninclusive examples
				illustrate the application of the divisible tax concept.
EXAMPLE A: As a responsible party, X is assessed withholding
				  income taxes, penalty, and interest on eight employees. X fails to timely
				  appeal the assessment. X contends that X is not a responsible party. If X is a
				  responsible party, X is required to make monthly deposits of the withholding
				  taxes. In this situation, the withholding taxes are divisible. Therefore, X may
				  pay an amount of tax, penalty, and interest attributable to one employee for
				  one month and file a refund claim within the time period provided by law since,
				  ifXis successful on the refund claim, the remaining unpaid portion of the
				  assessment would be canceled.
EXAMPLE B: Y is assessed sales tax, interest, and penalty for
				  electricity purchased and used to power a piece of machinery in Y's
				  manufacturing plant. Y fails to timely appeal the assessment. Y was billed
				  monthly for electricity by the power company to which Y had given an exemption
				  certificate. Y contends that the particular piece of machinery is used directly
				  in processing tangible personal property for sale and that, therefore, all of
				  the electricity is exempt from sales tax. In this situation, the sales tax is
				  divisible. Therefore, Y may pay an amount of tax, penalty, and interest
				  attributable to one month's electrical usage in that machinery and file a
				  refund claim within the time period provided by law since, if Y is successful
				  on the refund claim, the remaining unpaid portion of the assessment would be
				  canceled.
(5)
Who
				may be named in an appeal.
The appeal shall be brought in the name of
				the aggrieved taxpayer. The appeal may be filed by and in the name of the
				aggrieved taxpayer or by the authorized representative described in Iowa Code
				section 421.59(2), Iowa
				Code chapter 633B, or subrule 7.6(6) legally entitled to institute a proceeding
				on behalf of the person, or by an intervenor in contested case proceedings. In
				the event of a discrepancy between the name set forth in the appeal and the
				correct name, a statement of the reason for the discrepancy shall be set forth
				in the appeal.
(6)
Form and
				content of the appeal.
a.
Department forms.
Appeals may be filed using the form
				available on GovConnectIowa or the form available on the department's website,
tax.iowa.gov/forms
.
b.
Manually created appeals.
Persons who do not use GovConnectIowa or the form available on the department's
				website shall use the following format:
(1)
				The appeal shall contain a caption in the following form:
BEFORE THE DEPARTMENT OF
								REVENUE
HOOVER STATE OFFICE BUILDING
DES MOINES, IOWA
IN THE MATTER OF _________________
*
(state taxpayer's name and address and designate
								type of proceeding, e.g., income tax refund claim)
*
APPEAL
*
Docket No. ___________________
*
(filled in by Department)
(2)
				The appeal shall substantially state in separate numbered paragraphs the
				following:
1. Proper allegations showing:
* Date of department action, such as the notice of
				  assessment, refund denial, etc.;
* Whether the taxpayer failed to timely appeal the assessment
				  and, if so, the date of payment and the date of filing of the refund
				  claim;
* Whether the appeal involves the appeal of a refund claim
				  after six months from the date of filing the refund claim because the
				  department failed to deny the claim;
* Copies of the documented department action, such as the
				  notice of assessment, refund claim, and refund denial letter;
* Other items that the taxpayer wishes to bring to the
				  attention of the department; and
* A request for attorney fees, if applicable.
2. The type of tax, the taxable
				period or periods involved, and the amount in controversy.
3. Each error alleged to have been committed,
				listed in a separate paragraph. For each error listed, an explanation of the
				error and all relevant facts related to the error shall be provided.
4. Reference to any particular statute or
				statutes and any rule or rules involved, if known.
5. Description of records or documents that
				were not available or were not presented to department personnel prior to the
				filing of the appeal, if any. Copies of any records or documents that were not
				previously presented to the department shall be provided.
6. Any other matters deemed relevant and not
				covered in the above paragraphs.
7.
				The desire of the taxpayer to expedite proceedings. Rule
				701-7.13 (17A,421) contains more
				details on expedited proceedings.
8. A statement setting forth the relief
				sought by the taxpayer.
9. The
				signature of the taxpayer or that of the authorized representative. If the
				appeal is signed by the taxpayer, include the address and telephone number of
				the taxpayer in the signature block. If the appeal is signed by an authorized
				representative, include the address and telephone number of the authorized
				representative in the signature block. Appeals submitted by an authorized
				representative must have a valid IDR power of attorney form or representative
				certification form, as applicable in accordance with rule
				701-7.6 (17A), on file with the
				department, or one should be included with the appeal.
c.
Spouses.
If an appeal involves an assessment or a refund
				denial to a married couple and both spouses intend to appeal, both spouses must
				sign the document as drafted under paragraph 7.9(6)
"a"
or
"b."
Appeals submitted by an authorized representative must
				include an executed IA 2848 power of attorney form or representative
				certification form, as applicable, for each spouse, unless an IA 2848 power of
				attorney form or representative certification form is on file with the
				department.