how to sue township for its tax mistake

[baljiangusa]

What is the name of your state (only U.S. law)? PA

My township has refused to acknowledge its mistake and remediate its mistake in its earned income tax forms that had denied tax payers ability to claim out-of-state tax credit.

Here is some details.

In earned income tax (EIT) forms of 2008 and before, there is no place in the forms and in the instruction of the forms on claiming out-of-state credit (for residents who work in different state and pay income tax in that state like NY). I actually questioned the township official in the year I filed my first township EIT and the answer was that the township did not allow the credit. So, I had been doing the EIT like that for years until last year when I was doing 2009 and discovered that the form has changed and the form now allowed the credit claim.

So, I called township for possible change of the tax code and the answer was no change at all. This prompted my request to ask them to correct the mistake they made (which they never acknowledged) and allowed me to reclaim the credit. They insisted that I could only file for 2007-2008 for 3 year time limit. Eventually, they sent me a letter about their decision this April. I filed an appeal for the decision. The township did not do anything in two month and I told them that my appeal was now approved by the 'appeal board' due to inaction. They refused and stated that I could not file for any tax credit due to 3 year statue of limitation.

Could you please advise me on what to do to sue the township and what are the chances for a successful law suit against the township.

 

[ecmst12]

If you can find a lawyer willing to take this on, more power to you. You will NEVER succeed in this on your own.

 

[baljiangusa]

If you can find a lawyer willing to take this on, more power to you. You will NEVER succeed in this on your own.

Do you mind shedding a light on 'why' ?

 

[OHRoadwarrior]

Why do you think they need to enact a law? They may have changed a procedure. You need to request and read the tax code. If it is silent on the subject, you have no case.

 

[baljiangusa]

I assume when you say 'they' you meant 'the township'.

Even though the township did not acknowledge their 'mistake' in the EIT forms prior to 2009, but they did say that there had been no change in the tax code. The finance director of the township even suspected that the 2009 form was a mistake and it took them a while to realize that the 2009 form was correct. The 2010 form is the same as 2009 form.

The key issue here is that they would not acknowledge that their mistake had prevented tax payers from claiming the credit and move to correct the mistake by compensating tax payers for the lost credit. They maintained that no amendment of the tax form can be filed passing 3 year limit as if it was the tax payer who made the mistake.

 

[OHRoadwarrior]

Absent city tax code assigning the credit, it can be a matter of executive decision or procedure to grant or not grant it. Thus not allowing one to claim it retroactively isn't necessarily illegal or improper.

 

[baljiangusa]

Thanks a lot.

I see what you mean. I shall collect the local tax codes and executive orders and see if there is any specifics about handling of their own mistakes. Btw, they referred me to http://www.newpa.com/webfm_send/1541, which has no provision on that.