Revenue Finds Taxpayers Provided Sufficient Evidence to Prove Assessment of Individual Income Tax was Incorrect

Excerpts of Revenue's Determination follow:

Taxpayers protest the imposition of individual income tax for 2009. The issue is whether Taxpayers' Indiana adjusted gross income was properly determined.

IC 6-3-1-3.5(a) provides that "In the case of all individuals, 'adjusted gross income' (as defined in Section 62 of the Internal Revenue Code), modified as follows: [List of modifications]."

IC 6-8.1-5-1(c) provides in relevant part that "The notice of proposed assessment is prima facie evidence that the department's claim for the unpaid tax is valid. The burden of proving that the proposed assessment is wrong rests with the person against whom the proposed assessment is made."

In this particular case, Taxpayers filed a refund claim with the Internal Revenue Service regarding the Internal Revenue Service's determination of federal adjusted gross income. The Internal Revenue Service reviewed Taxpayers' refund claim and adjusted Taxpayers' federal adjusted gross income to the originally-reported number. Based on the Internal Revenue Service's review and adjustments, Taxpayers have provided sufficient legal and factual grounds to prove that the Department's proposed assessment was incorrect. However, if Taxpayers are assessed for additional federal adjusted gross income tax by the Internal Revenue Service, the Department can still assess additional Indiana adjusted gross income tax based on those federal adjustments.

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http://www.in.gov/legislative/iac/20140326-IR-045140071NRA.xml.html