Consequence of not petitioning the Tax Court?

Facts:

Taxpayer is invested is an S-Crop that the IRS audited. The IRS determined that there were changes necessary to the S-Corp return. Those changes led to a change in the items reported to the Taxpayer. NOD for over $100k is dated early September; somehow, it got misplaced and wasn't found until today. The last day to petition the tax court is tomorrow. The NOD fails to account for items reported on the Taxpayer's return.

For example,

LTCG
Reported on tax return $0 Amount per Exam $200K Adjustment $200k

When in reality, we reported $170k of LTCG on the return, as reported on the original K-1 from the entity. The actual adjustment should be $30k not $200k.

Once amounts on returns are accounted for, the tax owed goes down to about $10-20k.

Questions:

Am I overreacting as I'm ready to let someone go over this oversight? I'm overnighting a response package to the IRS agent handling the matter. If I don't file a petition with the Tax Court by tomorrow, does this eliminate my ability to debate the deficiency assessed with the agent after tomorrow?

TYIA!

It costs less thank $100 to file the petition...I certainly would do it.

Read about what happens if the client doesn't file the petition, the date lapses and the IRS doesn't agree with you and sticks to their guns. You'll come to the conclusion that if it's gotten to that point, it's always advisable to file the petition. Someone on this board mentioned in a past post that not advising the client to file amounts to malpractice. I tend to agree with that sentiment.

Follow up question. Is a Petition postdated the day its due considered timely filed?

I'd want it postmarked by the deadline, and would get a certified receipt.

Instruct your client to file the petition. If the petition deadline is missed and the IRS doesn’t budge, your only option is to pay the tax and then file suit for refund in US District Court or US Court of Federal Claims.

There is a PDF template that you download from the tax court website and fill in for the client. It's pretty easy to figure out. The hard part might be getting the client signature(s) with such a tight turnaround. If they're local, invite them to breakfast tomorrow morning and tell them to bring the check. Then go to the post office after.

TY all for your responses. MVT touches on the main point of concern. Getting clients' signatures. I'll spend the rest of the day preparing the petition if that's what it takes. FWIW, how hard to you think they investigate whether its a wet or scanned signature?

Definitely malpractice to recommend not filing the petition. Similar question asked about a month ago: viewtopic.php?f=8&t=26826

Signature s/be in blue ink.

TP need not sign a Petition to the Tax Court. An attorney or other person authorized to practice before the Tax Court can sign. A bare bones petition is sufficient to meet the deadline. The case will be referred to Appeals where you can get a reasonable settlement. Failure to file is inexcusable.

Here's a useful guide for electronic filing: https://www.ustaxcourt.gov/resources/da ... _Guide.pdf

Most CPAs are not authorized to practice before the Tax Court.