Tax Law Insights

Once the South Carolina Department of Revenue (SCDOR) completes an audit of a taxpayer, if there are any proposed adjustments and additional taxes SCDOR seeks, it will issue to the taxpayer a proposed notice of assessment with an examination report. A taxpayer then has 90 days to administratively protest/appeal the proposed assessment within SCDOR.

SCDOR formerly had an "appeals" audit function. This appeals audit function was abolished by SCDOR, however, and appeals/protests of proposed audit assessments now simply go back to the auditor, and to the auditor's supervisor.

If a resolution cannot be reached with the auditor/supervisor, the supervisor will send the file to SCDOR's Office of General Counsel for litigation. It is the responsibility of SCDOR litigation counsel to review the file, and prepare a "Department Determination," which is the final agency notice to a taxpayer of a proposed assessment.

If SCDOR issues a Department Determination, the taxpayer has 30 days to file a "contested case" hearing request with the South Carolina Administrative Law Court (ALC) in Columbia, which is the state's "Tax Court" (the ALC hears many other types of non-tax cases as well). The ALC is an independent body, not affiliated with SCDOR. Appeals from the ALC then go to the South Carolina Court of Appeals, and to the South Carolina Supreme Court, if necessary.