Revenue Administrative Bulletin 1989-35

CHALLENGE OF ASSESSMENT, DECISION, OR ORDER LIMITED BY STATUTE

Approved: April 25, 1989

RAB-89-35. This Bulletin describes when the time expires for a person to enter a written appeal of the issuance of a final assessment, decision, or order of Bureau of Revenue, Department of Treasury.

A taxpayer may have a right to appeal a decision, order, assessment, or determination of the Department in the following circumstances:

1.            A final determination of a tax deficiency, or

2.            The denial of a claim for a refund, or

3.            The recovery of taxes paid under protest, or

4.            Any other decision of the Department, such as denial of tax-exempt status.

If the appeal is not made within the time required, then the assessment, decision, or order will become final and may not be challenged further by the taxpayer.

Avenue to Perfect an Appeal

1.            Appeal to the Michigan Tax Tribunal:

MCL 205.22(1) provides that a person who is not satisfied with an assessment, decision, or order of the Department with respect to the determination of a tax administered under the Revenue Act may appeal the contested portion of the assessment, decision, or order to the Michigan Tax Tribunal within 30 days from the date of that assessment, decision, or order. The amount not in dispute must be paid prior to the appeal.

2.            Appeal to Michigan Court of Claims:

Section 22(1) also provides that a person who is not satisfied with an assessment, decision, or order of the Department may appeal the contested portion of that assessment, decision, or order to the Michigan Court of Claims within 90 days from the date of that assessment, decision, or order. The taxpayer appealing to the Michigan Court of Claims must pay the contested and uncontested tax, including penalties and interest, and claim a refund as part of the appeal.

An appeal from the decision of the Tax Tribunal or the Court of Claims must be made to the Court of Appeals within the specified time. Further appeal to the Michigan Supreme Court, from a decision of the Court of Appeals, may be sought in accordance with the Supreme Court rules.

Departmental Review After Issuance of Assessment, Decision, or Order

The Department will not review a finalized assessment, decision, or order of the Department, or issue a refund of any tax, interest, or penalty paid on an assessment, unless the taxpayer has made a timely appeal of the assessment, decision, or order to the Michigan Tax Tribunal or to the Michigan Court of Claims.

The taxpayer may attempt to resolve the tax in dispute by submitting additional information to the Department that was no made available at the time the tax was assessed. This information must be considered by the Commissioner. The Commissioner will unilaterally decide whether to sustain the finalized assessment. However, if the Department and the taxpayer cannot resolved the tax in dispute, and the taxpayer does not exercise the right to an appeal either: (1) to the Tribunal within 30 days from the date of the Department’s assessment, decision, or orders; or (2) to the Court of Claims within 90 days from the date of the Department’s assessment, decision, or order, then the assessment, decision, or order is final, conclusive, and not subject to further challenge to the Tax Tribunal or Court of Claims by the taxpayer. [MCL 205.22(1)] Further, “[t]he assessment, decision or order of the department, if not appealed in accordance with this section [MCL 205.22(1)] shall be final and shall not be reviewable in any court by mandamus, appeal, or other method of direct or collateral attack.” [MCL 205.22(2)] Therefore if an aggrieved taxpayer does not challenge a determination in the manner and time as provided, then an attack is prohibited.

An aggrieved taxpayer may not circumvent the limitations period on challenging an assessment, decision, or order of the Department by resorting to the refund procedure. Once the time to challenge and assessment has expired a taxpayer is no longer entitled to a refund. The statutory prohibition is found in the Revenue Act, MCL 205.22(3), stating “[a]n assessment shall be final, conclusive, and not subject to further challenge after 90 days from the issuance of the assessment, decision, or order of the department, and a person SHALL NOT BE ENTITLED TO A REFUND of any tax, interest, or penalty paid pursuant to an assessment unless the aggrieved person has appealed the assessment in the manner provided by this section.” [MCL 205.22(1)] (Emphasis added)