Tax Law Defined® Blog

Court Rules in Favor of More Transparency for Kentucky Taxpayers

The Kentucky Supreme Court, in Department of Revenue v. Mark F. Sommer, upheld all lower court decisions requiring the Department of Revenue (DOR) to make its redacted final rulings publicly available. The Court ruled that the state DOR took an “unreasonable and overly broad view” of public records statutes and later denied the department’s request for appeal.

Frost Brown Todd attorney Mark Sommer, on behalf of a client, first petitioned the Finance and Administration Cabinet to release its redacted final rulings in 2012. After that case was settled, Sommer and his counsel, Frost Brown Todd attorney Jennifer Barber, took on the issue for all taxpayers, arguing that the failure to disclose these records amounted to a “secret law.” As such, the state had an unfair advantage over taxpayers during administrative hearings.

Sommer and Barber spent seven years fighting for these rights, receiving affirmative rulings at every level despite the DOR’s insistence that certain statues prohibit the disclosure of confidential taxpayer documents. This past year, Barber successfully countered the DOR’s position when she argued before the Kentucky Supreme Court that a simple redaction of private information would solve that problem.

Department of Revenue v. Mark F. Sommer has broad implications for Kentucky taxpayers. Before this case, businesses lacked understanding of how the DOR issues and enforces their final rulings because they could not review the documents. The Court’s decision will now lend more transparency to tax administration matters, giving the public greater insight into the DOR’s interpretation and enforcement of state tax laws.

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Attorney Spotlight

Daniel G. Mudd is a member of FBT, handling federal, state and local tax matters, including sales and use, excise (e.g., alcohol and tobacco), income, local occupational license and business taxes.

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