Department of Taxation and Finance

Administration and Oversight of the Tax Protest Resolution Process

The Department of Taxation and Finance may make adjustments in the tax liabilities claimed by taxpayers or determine amounts are owed by taxpayers who have not filed tax returns. If a taxpayer does not agree with an adjustment or a determination, the taxpayer can file a protest (formal or informal) with the Department. Most protests are informal, and they are resolved by Department staff.

We examined the timeliness of the resolution process for informal protests and found that significant improvements had been made since our prior audit in 1994. At that time, 46 percent of the informal protests that were resolved during our 15-month audit period took more than 240 days to resolve, and 30 percent of these protests took more than 365 days to resolve. In comparison, during our current audit period, most informal protests were resolved within 90 days. We noted that the Department had established goals for increasing the timeliness of the resolution process, and had improved its system for monitoring the status of unresolved protests. While further enhancements could be made in the Departmentís monitoring system and further improvements were needed in the timeliness of the resolution process, the progress made by the Department since 1994 was commendable.

For a complete copy of Report 2003-S-42 click here.
For a copy of the 90-day response click here.
For a copy of the associated follow-up report click here.