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PolitiFact.com | Tampa Bay Times
Sorting out the truth in politics

Usually, burden of proof falls on taxpayers, not IRS

The statement

"The IRS doesn't have to prove something against you … you've got the burden of proof."

U.S. Rep. Randy Forbes, R-Va., in an interview with Fox News

The ruling

Generally speaking — beyond some exceptions that we'll outline below — the burden of supplying information is indeed on the taxpayer when he is told by the IRS that he underpaid his taxes or when he faces an IRS audit.

This is a "traditional rule, going back a long way," said David Weisbach, a University of Chicago law professor who worked earlier in his career as an attorney-adviser in the Treasury Department's Office of the Tax Legislative Counsel.

The IRS lays out the specifics on a Web page titled "Burden of Proof."

"The responsibility to prove entries, deductions, and statements made on your tax returns is known as the burden of proof," it says. "You must be able to prove … certain elements of expenses to deduct them. Generally, taxpayers meet their burden of proof by having the information and receipts … for the expenses. You should keep adequate records to prove your expenses or have sufficient evidence that will support your own statement. You generally must have documentary evidence, such as receipts, canceled checks, or bills, to support your expenses."

In other words, the IRS is presumed to be correct unless the taxpayer produces "credible evidence" to counter the agency's finding, said Timothy Jacobs, a partner specializing in tax law at the firm Hunton & Williams.

It's worth noting that as frustrating as this burden may be, the alternative is even worse, said Neil H. Buchanan, a law professor at George Washington University. "If the IRS had the burden to produce evidence, it would have to be given access to individuals' private files in order to find that evidence," he said. "Is that what we really want the IRS to be doing?"

There are a few exceptions to this rule. The most notable, since the penalties are so severe, are for tax-related criminal cases and civil fraud cases. In these types of cases, the burden of proof is essentially the same as it is for any other criminal case: The government, not the taxpayer, has to prove its case.

So how common are the exceptions? Tax experts said criminal and civil fraud cases are rare today when compared with ordinary tax liability cases.

On balance, we rate Forbes' claim Mostly True.

Edited for print. Read the full version at PolitiFact.com.

Usually, burden of proof falls on taxpayers, not IRS 05/24/13 [Last modified: Friday, May 24, 2013 10:31pm]
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