The words are old, rarely heard in public and often buried in long and overly-wordy legal documents that interest only lawyers, historians or government officials. But the phrase "without due process of law" is one of those ancient challenges to the basic freedoms of Americans that set liberty-loving peoples' blood to boiling and raise cries for fairness and honesty from their government.
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| Jack Faris is president of the National Federation of Independent Business. |
While many of the nation's small-business owners may not be able to pinpoint the location of the phrase, which is locked away in the Fifth Amendment of the Constitution of the United States, they instinctively understand that their continued economic survival is dependent upon a properly-functioning system that recognizes and holds sacred the rights it implies.
That's why the NFIB Legal Foundation, upon learning that the U.S. Tax Court recently refused to disclose information in a case involving a small-business owner, has taken up this challenge before the U.S. Supreme Court. The tax court's refusal to allow access to special trial judges' reports, the Foundation asserts, is a clear violation of a taxpayer's right to due process.
The issues under review in the case of Ballard v. Commissioner of Internal Revenue are of considerable importance to all taxpaying Americans, especially small-business owners. Similar to many other tax cases, the underlying case stated in the U.S. Tax Court where a Chief Judge appoints a special trial judge (STJ) to conduct the trial. At the conclusion of the trial, the STJ submits a report to the Chief Judge who can then accept, reject or modify the report. However, due to a change of direction by the Tax Court in 1983, the STJ reports are no longer disclosed to the parties, nor are the reports included in the court record.
Currently, the tax court is the only forum in which a small-business owner or an individual (nearly 83 percent of small businesses file taxes as an individual) can contest an income tax without first paying the deficiency in full. Therefore, many small businesses choose to try their tax disputes in tax court. But denied the ability to review the STJ reports, a taxpayer's ability to appeal the court's decision is severaly hampered because they have no way of knowing why the decision was made.
In its friend-of-the-court filing, the NFIB Legal Foundation points to that ancient language contained in the due process clause claiming that the case is founded upon two simple principles of democracy: fairness and transparency. These are true hallmarks of the judicial process.
It's bad enough that these entrepreneurs must face an increasingly complex federal tax code that bleeds them of time and money that they could be investing to make their businesses bigger and stronger. Requiring full-disclosure and transparency for all records is essential to ensuring that small-business owners have the ability to properly challenge decisions by the tax court or any other office of our nation's legal system.
The U.S. Tax Court is long overdue for a refresher course in due process.
Jack Faris is president of NFIB (the National Federation of Independent Business), the nation's largest small-business advocacy group. A non-profit, non-partisan organization founded in 1943, NFIB represents the consensus view of its 600,000 members in Washington, D.C., and all 50 state capitals.
