Key Takeaways The small case procedure is available for disputes of $50,000 or less per tax year (including penalties) Proceedings are informal with relaxed rules of evidence and procedure Decisions in S cases cannot be appealed by either party Both the taxpayer and the IRS must consent to the small case designation The procedure is well-suited for straightforward factual disputes with clear documentation What Is the formal tax dispute process Small Case Procedure? The federal tax disputes offers a special simplified procedure for disputes involving smaller amounts — specifically, cases where the total amount of deficiency (including any penalties) placed in dispute for each tax year does not exceed $50,000. This procedure, known as the "S case" or small tax case procedure, was created by Congress to provide taxpayers with an accessible, efficient, and less intimidating way to resolve their tax disputes in court. The small case procedure is part of the broader IRS Appeals and the formal tax dispute process system and provides an alternative to the regular tax dispute resolution process described in our formal dispute petition guide . While the regular procedure involves formal rules of evidence, extensive discovery, written briefs, and potentially lengthy trials, the S case procedure streamlines these elements to make the process more manageable for taxpayers who may not have legal representation. Eligibility Requirements To qualify for the small case procedure, your case must meet these requirements: Amount in dispute: The total deficiency (including penalties) for each tax year must not exceed $50,000. If you are disputing multiple tax years, each year must independently meet this threshold. Type of tax: The small case procedure is available for income tax, estate tax, gift tax, and certain excise tax cases. Election by taxpayer: You must affirmatively elect the small case procedure when filing your petition...