Quick answer

If you receive a Notice of Deficiency (the IRS’s “90‑day letter”), you generally must file a petition in U.S. Tax Court within 90 days of the date the notice was mailed (150 days if you live outside the U.S.). Filing a timely petition gives you a forum to dispute proposed adjustments without paying the disputed tax first. (U.S. Tax Court: https://www.ustaxcourt.gov/)

How the Tax Court process actually works

  1. Notice of Deficiency arrives
  • The IRS issues a Notice of Deficiency when it proposes an adjustment to your return (for example, disallowing a deduction or increasing income). The notice explains the adjustments and informs you of your right to petition the U.S. Tax Court. This is commonly called the “90‑day letter.” (See the U.S. Tax Court and IRS resources linked below.)
  1. Decide whether to file
  • You have options: pay the tax and sue for a refund in U.S. District Court or the Court of Federal Claims, or file a petition in Tax Court to contest the deficiency without paying first. Many taxpayers choose Tax Court to avoid the upfront payment.
  1. Prepare and file the petition
  • A petition must be filed with the Tax Court within the deadline stated in the Notice of Deficiency. The petition should state your grounds for disagreeing with the IRS adjustments, include relevant facts, and request the relief you want.
  1. Pretrial and discovery
  • After filing, both sides exchange information. The Tax Court follows rules for pleadings, motions, discovery, and pretrial conferences. Many cases settle during this phase.
  1. Trial/hearing
  • If the case proceeds, it can be handled as a normal Tax Court case (full procedure) or a small tax case (simplified procedure) if the amount in dispute is within the Tax Court’s small case threshold. Small tax cases are quicker and less formal but have different appeal consequences.
  1. Decision and appeal
  • The Tax Court issues an opinion or decision. If you lose, you can generally appeal to the U.S. Court of Appeals for your circuit. Small tax case decisions typically cannot be appealed.

Authoritative sources: U.S. Tax Court (https://www.ustaxcourt.gov/) and IRS Publication 556 (Examination of Returns, Appeal Rights, and Claims for Refund) (https://www.irs.gov/pub/irs-pdf/p556.pdf).

When should you file — deadlines and practical timing

  • The usual deadline is 90 days from the date the Notice of Deficiency is mailed to you. If you live outside the United States, you typically have 150 days. Missing this deadline usually removes your right to contest the deficiency in Tax Court and leaves you limited to paying the tax and filing a refund suit. (U.S. Tax Court: Rules and notices.)
  • Don’t confuse the Tax Court deadline with collection‑related notices. For collection due process (CDP) appeals you typically have 30 days to request a hearing with the IRS Office of Appeals after a Notice of Federal Tax Lien or a proposed levy — a different process and timeframe.

Practical tip from my practice: treat the 90‑day window as sacrosanct. Even a few days’ delay can shift your only forum for dispute and complicate defenses.

Types of Tax Court cases to expect

  • Deficiency cases: The most common type; taxpayer challenges an IRS proposed deficiency after a notice.
  • Collection Due Process (CDP) appeals: These are related to collection actions; deadlines and procedures differ.
  • Declaratory judgment and partnership-item cases: Specialized procedural rules can apply.
  • Small tax cases (S cases): For disputes at or below the small case threshold (check current Tax Court guidance for the exact dollar limit). Small cases are faster and informal but may limit later appeals.

Note: thresholds and procedural nuances change rarely but do occur. Always confirm current limits on the Tax Court website.

Evidence, burden of proof, and strategies

  • Generally, the taxpayer must substantiate claims and provide credible evidence (receipts, contracts, contemporaneous records, bank statements, logs, witness statements). In many cases, the taxpayer bears the initial burden to show error in the IRS determination.
  • In certain circumstances, IRC §7491 can shift the burden of proof to the IRS, but taxpayers must meet specific substantiation and cooperation requirements. Consult a tax attorney or enrolled agent to evaluate whether this applies to your case.

Professional strategy I use: assemble a “trial binder” with a timeline, copies of the Notice of Deficiency, your original return, a one‑page summary of disputed items, and clearly tabbed exhibits. Judges and settlement officers respond well to organized, concise presentations.

Pre‑filing alternatives and settlement options

Before—or after—filing, consider:

  • Administrative appeal with IRS Appeals — many disputes settle here without court involvement. See our guide on related audit and appeal strategies When to Appeal an IRS Audit Determination: A Decision Guide.
  • Offer in Compromise, installment agreements, or penalty abatement for collection problems (these are collection remedies, not direct substitutes for a Tax Court petition).
  • Thorough documentation and informal discussions with the agent can sometimes resolve issues before a deficiency notice is issued. For preparation, see Preparing for an Audit: Documentation and Tips.

What to expect at and before trial

  • Proceedings are held in U.S. Tax Court locations across the country. Trials may be in person or, increasingly, by video conference depending on the court’s rules and logistics.
  • Expect procedural steps: answer from the Commissioner, discovery requests, motions (e.g., motions to dismiss or for summary judgment), pretrial memoranda, and a trial or settlement conference.
  • Practical reality: the majority of cases settle before trial. If a trial occurs, be prepared to testify, produce exhibits, and make concise legal arguments.
  • Evidence checklist: If your matter started with an audit or field review, use evidence checklists to organize exhibits—see our Evidence Checklist for an IRS Field Audit of Individuals for a starting point.

Costs, representation, and risk management

  • Representation: You may represent yourself, but many taxpayers hire tax attorneys, enrolled agents, or CPAs with litigation experience. Professional representation can be worth the cost when legal issues or large amounts are at stake.
  • Cost considerations: litigation involves time and fees (attorney, expert witnesses, travel). Balancing expected tax savings versus costs is essential—sometimes settling administratively is the better economic choice.

My client example: I worked with a small business owner who received a notice reclassifying contractor payments as compensation. We filed a timely petition, focused our evidence on written contracts and payment patterns, negotiated in pretrial, and reached a favorable settlement—saving the client more than the cost of representation.

If you lose

  • If the Tax Court rules against you, the decision will explain the legal and factual basis. You will generally owe the tax, plus interest and possibly penalties. You can appeal to the U.S. Court of Appeals for your circuit, but appeals add time and expense.

Practical checklist before filing

  • Read the Notice of Deficiency carefully and calendar the filing deadline immediately.
  • Assemble records that support your position (returns, receipts, contracts, contemporaneous notes).
  • Consider contacting IRS Appeals — many disputes resolve there.
  • Consult a tax litigator or experienced practitioner if the amount in dispute, penalties, or legal issues are substantial.
  • If filing, prepare a clear petition that follows Tax Court rules and local filing procedures.

Helpful links and authoritative sources

Disclaimer: This article is educational and general in nature. It does not constitute legal or tax advice for your specific situation. For tailored guidance on filing in Tax Court, consult a qualified tax attorney, CPA, or enrolled agent.