By Kelly A. Kelly, Indiana Department of Revenue
Senate Enrolled Act 408 (2020) added IC § 6-8.1-5-1.5 to the Indiana Code. Under this statute, an affected taxpayer, whether an individual, joint filers, or a business, may request a secondary review of a Department of Revenue (DOR) audit result, application denial, investigation, an adjustment to the taxpayer’s original or amended return, or any review of the taxpayer’s records which results in a net operating loss, capital loss, credit, or any tax attribute which does not – at the time of the adjustment – result in an immediate assessment or refund denial for any taxable year.
Impacted taxpayers should first receive a notice from DOR detailing the adjustment to the return or the application denial. This notice will also provide further information and instructions pertaining to the Secondary Review Request process and form. The taxpayer has 60 days from the date of the notice to submit a Secondary Review Request. The request allows the taxpayer to explain why they disagree with the adjustment or application denial and provide any necessary documentation. Upon receipt of the request, DOR will review taxpayer’s request and any documents related to the adjustment or application denial.
The DOR Legal Services department (LS department) receives and reviews Secondary Review Requests. After an initial examination, which may include discussions with DOR’s Audit division, an LS department senior counsel may agree with the taxpayer’s objections and determine that an administrative adjustment reflecting that decision is necessary.
Alternatively, the LS department senior counsel may determine that DOR should conduct a conference with the taxpayer. That conference will include the LS department senior counsel, the taxpayer and/or taxpayer’s authorized representative, and any other DOR department or taxpayer participant necessary to address the Secondary Review Request. At the discretion of the LS department, the conference may be conducted by virtual meeting or telephone.
The conference may determine that the taxpayer’s objections are correct and DOR should make an administrative adjustment, or it may determine that the taxpayer’s objections are unwarranted and no further action is required. In either case, the LS department will communicate the results to the taxpayer in writing. The LS department will also ensure that DOR adds this communication to the taxpayer’s record and implements any necessary adjustment.
Per IC § 6-8.1-5-1.5, any response provided by DOR to a request for a secondary review of adjustment or application denial will not represent a final determination.
Finally, the taxpayer and DOR’s designated representatives may conclude that the disputed issue may be resolved by means of a binding settlement agreement. Questions regarding this process should be directed to the DOR Legal Services department at DORSRA@dor.in.gov.
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