Tax Court Requires Evidence of Assets and Liabilities to Justify Relaxing Tax Payment Requirement
Mar 2, 2022 | Written by: | Share
In Branchburg Hospitality LLC v. Twp. of Branchburg, Tax Court Docket No 11494-21 (Feb. 25, 2022), the Tax Court upheld the County Tax Board’s dismissal of a complaint where the taxpayer had failed to pay property taxes. When the defendant municipality moved to dismiss the complaint for failure to pay taxes and respond to Chapter 91 requests before the Tax Board, the plaintiff requested a waiver of the tax payment requirement due to decreased revenues during the COVID-19 pandemic. The County Tax Board did not address the issue of the failure to pay taxes and dismissed for failure to respond to Chapter 91 requests. The plaintiff appealed the decision to the Tax Court and the defendant municipality moved again to dismiss the complaint for failure to pay taxes pursuant to N.J.S.A. 54:51A-1(b).
In dismissing the complaint for failure to pay taxes, the Tax Court recognized its discretion to relax the tax payment requirement in the interests of justice. Huwang v. Twp. of Hillside, 21 N.J. Tax 496, 506-10 (Tax Ct. 2004). The plaintiff in Branchburg asserted that the subject hotel was closed for much of 2020, resulting in substantially decreased revenues. However, the Court found it instructive that the plaintiff only provided a “profit and loss statement” without any further explanatory statements. The plaintiff provided no further evidence of the effects of the pandemic on its business or any evidence of actions taken to ameliorate the effects of the pandemic on its business. The Tax Court noted that the plaintiff relied on a general reference to the COVID-19 pandemic and did not offer any evidence of assets or liabilities or evidence of inability to make tax payments. Therefore, the Tax Court held that the plaintiff failed to provide a sufficient factual basis to support a finding that the tax payment requirement should be relaxed in the interests of justice.
This decision shows that a decrease in revenues, even if substantial and due to outside forces, is insufficient on its own to support a waiver of the requirement to pay taxes before filing a tax appeal pursuant to N.J.S.A. 54:51A-1(b).
Tara St. Angelo, Esq. concentrates her practice primarily in the areas of municipal and land use law. She was named to the NJ Super Lawyers Rising Stars list for State, Local and Municipal law by Thomson Reuters in 2017, 2018, 2019, 2020, and 2021. Contact Ms. St. Angelo at Gebhardt & Kiefer, PC at 908-735-5161 or via email.
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