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SEC. 7491. BURDEN OF PROOF.
(a) Burden Shifts Where Taxpayer Produces Credible
Evidence.--
(1) General rule.--If, in any court
proceeding, a taxpayer introduces credible
evidence with respect to any factual issue
relevant to ascertaining the liability of the
taxpayer for any tax imposed by subtitle A or B,
the Secretary shall have the burden of proof with
respect to such issue.
(2) Limitations.--Paragraph (1) shall apply
with respect to an issue only if--
(A) the taxpayer has complied with the
requirements under this title to substantiate
any item;
(B) the taxpayer has maintained all
records required under this title and has
cooperated with reasonable requests by the
Secretary for witnesses, information,
documents, meetings, and interviews; * * *
See also Internal Revenue Service Restructuring and Reform Act of
1998, Pub. L. 105-206, sec. 3001(c), 112 Stat. 727, regarding
effective date.
Section 7491 applies here in that the examination of a 2000
tax return began after the statute’s effective date. However,
legislative history makes clear that the burden will be shifted
to the Commissioner under the statute only in cases where the
taxpayer establishes that he or she meets the prerequisites set
forth in section 7491(a)(2). H. Conf. Rept. 105-599, at 239-242
(1998), 1998-3 C.B. 747, 993-996.
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Last modified: May 25, 2011