Tax Court proceedings have some notable differences from civil litigation, particularly the requirements to stipulate to the greatest extent possible and to engage in informal discovery before initiating formal discovery. Also, evidentiary rules are relaxed for Small Tax Cases.
The Pre-Trial Order requires you to prepare written stipulations and to exchange witness lists and documents at least 15 days before trial. Tax Court Rule 91 mandates that the parties stipulate to the fullest extent that complete or qualified agreement can be fairly reached. This rule is mandatory, not aspirational. Failure to comply with stipulation, disclosure, and consultation rules can result in dismissal of the petition for lack of prosecution.1 Work cooperatively with the IRS attorney, and document your efforts to stipulate. If you need to subpoena documents or a potentially unfriendly witness (for example, an employer), this should be done as soon as you become aware of the Calendar Call date.
Normally, discovery by the taxpayer is unnecessary. However, if you need discovery, you should proceed promptly with consultation and discovery given tight Tax Court deadlines. Under Branerton Corp. v. Commissioner, the parties should make reasonable informal efforts to obtain information voluntarily before seeking formal discovery.2