By Mr. Coughlin of Dedham, petition (accompanied by bill, House, No. 2874) of Robert K. Coughlin and others that the State Auditor be directed to conduct of study of the Office of Appeals within the Department of Revenue.  Revenue.

The Commonwealth of Massachusetts

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PETITION OF:

Robert K. Coughlin

John P. Fresolo

Bradley H. Jones, Jr.

James E. Timilty

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In the Year Two Thousand and Seven.

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An Act improving the Office of Appeals within the Department of Revenue.

    Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Notwithstanding any general or special acts to the contrary, the Auditor is hereby directed to conduct a study of the Office of Appeals within the Department of Revenue and report its findings to the joint committee on revenue by July 1, 2007.  The study shall provide information on an annual basis for the most recent five years for which complete data is available with respect to the number of cases filed with the Office of Appeals pursuant to sections 37A and 37C of chapter 62C of the General Laws for which a request for settlement consideration has been made; the dollar amount of the settlement recommendation offered; the number and percentage of cases that are finally resolved at the Office of Appeals; the number of cases for which a mutually acceptable settlement has not been reached and the percentage and number of those cases that are further appealed to the Appellate Tax Board; the number and percentage of the cases that are settled at the Appellate Tax  Board  and the dollar amount of the settlement.

SECTION 2.           Chapter 62C of the General Laws, as appearing in the 2004 Official Edition, is hereby amended by inserting the following new section:-

Section 37D.    Awarding of costs and certain fees.

In any administrative or court proceeding which is brought by or against the Commonwealth, or the Department of Revenue on its behalf, in connection with the determination, collection, or refund of any tax, interest or penalty under the tax laws of the commonwealth, the prevailing party may be awarded a judgment or a settlement for (1) reasonable administrative costs incurred in connection with such administrative proceeding and (2) reasonable litigation costs incurred in connection with such proceeding; provided that a judgment for reasonable litigation costs shall not be awarded in any court proceeding unless the court determines that the prevailing party has exhausted the administrative remedies available to such a party within the Department of Revenue and provided further that no award of reasonable litigation and administrative costs may be  made pursuant to this section with respect to any portion of the administrative or court proceedings during which the prevailing party has unreasonably protracted such proceeding.  For purposes of this section, the definitions of “reasonable litigation costs”, “reasonable administrative costs”, “attorneys fees”, “prevailing party”,  “administrative proceedings”, “court proceedings” and “position of the United States” will be those contained in 26 USC Sec. 7430 to the extent possible, provided however that “Department of Revenue will be substituted for any reference to the “Internal Revenue Service”.