701—7.8 (17A) Protests. Any person wishing to contest an assessment, denial of refund claim, or any other department action, except licensing, which may culminate in a contested case proceeding shall file a protest, in writing, with the department within the time prescribed by the applicable statute or rule for filing notice of application to the director for a hearing. The protest must be either delivered to the department by United States Postal Service, by ordinary, certified, or registered mail, directed to the attention of the administrative law judge, personally delivered to the office of the administrative law judge, or be served on the department by personal service during business hours. For the purpose of mailing, a protest is considered filed on the date of the postmark. It is considered filed the date personal service or personal delivery to the office of the administrative law judge is made. See Iowa Code section 622.105 for the evidence necessary to establish proof of mailing. The period for appealing agency action relating to refund claims is the same statutory period for contesting an assessment. For assessments issued before January 1, 1995, the time period for filing a protest to an assessment cannot be extended by filing a refund claim. Failure to timely file a written protest will be construed as a waiver of opposition to the matter involved unless on the director’s own motion, pursuant to statutory authority, the power of abatement is exercised. The review unit may seek dismissal of protests which are not in the proper form as provided by this rule. See subrule 7.11(2) for dismissals.
For refund claims filed on or after January 1, 1995, if the department has not granted or denied a refund claim within six months of filing the claim, the refund claimant may file a protest. Even though a protest is so filed, the department is entitled to examine and inspect the refund claimant’s records to verify the refund claim.
Notwithstanding the above, the taxpayer who fails to timely protest an assessment issued on or after January 1, 1995, may contest the assessment by paying the whole assessed tax, interest, and penalty and by filing a refund claim within the time period provided by law for filing such claim. However, in the event that such assessment involves divisible taxes, which are not timely protested, namely, an assessment which is divisible into a tax on each transaction or event, the taxpayer can contest the assessment by paying a portion of the assessment and filing a refund claim within the time period provided by law. In this latter instance, the portion paid must represent any undisputed portion of the assessment and must also represent the liability on a transaction or event for which, if the taxpayer is successful in contesting the portion paid, the unpaid portion of the assessment would be canceled. Flora v.	United States, 362 U.S. 145, 4 L.Ed.	2d 623, 80 S.Ct.	630 (1960); Higginbotham v.	United States, 556 F.2d 1173 (4th Cir. 1977); Steele v.	United States, 280 F.2d 89 (8th Cir. 1960); Stern v.	United States, 563 F. Supp. 484 (D.Nev.	1983); Drake v.	United States, 355 F. Supp. 710 (E.D. Mo.	1973). Any such protest filed is limited to the issues covered by the amounts paid for which a refund was requested and denied by the department. Thereafter, if the department does not grant or deny the refund within six months of the filing of the refund claim or if the department denies the refund, the taxpayer may file a protest as authorized by this rule.
All of the taxes administered by the department can be divisible taxes, except individual income tax, fiduciary income tax, corporation income tax, and franchise tax. The following noninclusive examples illustrate the application of the divisible tax concept.
Example A:  X is assessed withholding income taxes, penalty and interest, as a responsible party on eight employees. X fails to timely protest the assessment. X contends that X is not a responsible party. If X is a responsible party, X was required to make monthly deposits of the withholding taxes. In this situation, the withholding taxes are divisible. Therefore, X can pay an amount of tax, penalty and interest attributable to one employee for one month and file a refund claim within the time period provided by law since if X is successful on the refund claim the remaining unpaid portion of the assessment would be canceled.
Example B:  Y is assessed sales tax, interest, and penalty for electricity purchased and used to power a piece of machinery in Y’s manufacturing plant. Y fails to timely protest the assessment. Y was billed monthly for electricity by the power company to whom Y had given an exemption certificate. Y contends that the particular piece of machinery is used directly in processing tangible personal property for sale and that, therefore, all of the electricity is exempt from sales tax. In this situation, the sales tax is divisible. Therefore, Y can pay an amount of tax, penalty and interest attributable to one month’s electrical usage in that machinery and file a refund claim within the time period provided by law since if Y is successful on the refund claim the remaining unpaid portion of the assessment would be canceled.
The protest shall be brought by and in the name of the interested or affected person or by and in the full descriptive name of the fiduciary legally entitled to institute a proceeding on behalf of the person or by an intervenor in contested case proceedings. In the event of a variance in the name set forth in the protest and the correct name, a statement of the reason for the discrepancy shall be set forth in the protest.
A protest which is filed shall contain:
	 7.8(1) A caption in the following form:
BEFORE THE IOWA STATE DEPARTMENT OF REVENUE
HOOVER STATE OFFICE BUILDING
DES MOINES, IOWA

IN THE MATTER OF _________________	*	 	
(state taxpayer’s name, address and	*	PROTEST	
designate type of proceeding, e.g.,	*	DOCKET NO. ___________________	
income tax refund claim)	*	(filled in by Department)	
 	 	 	
	 7.8(2) Substantially state in separate numbered paragraphs the following:
	  a.   	 Proper allegations showing:
	 (1) 	 Date of assessment.
	 (2) 	 Date of refund denial.
	 (3) 	 Whether, for assessments issued on or after January 1, 1995, protester failed to timely appeal the assessment and, if so, the date of payment and the date of filing the refund claim.
	 (4) 	 Whether, for refund claims filed on or after January 1, 1995, the protest involves the appeal of a refund claim after six months from the date of filing the refund claim because the department failed to deny the claim.
	 (5) 	 Attach a copy of the assessment, refund claim, and refund denial.
	 (6) 	 Other items that the protester wishes to bring to the attention of the department.
	  b.   	 The type of tax, the taxable period or periods involved and the amount in controversy;
	  c.   	 List each error alleged to have been committed in a separate paragraph. For each error listed, provide an explanation of the error and all relevant facts related to the error;
	  d.   	 Refer to any particular statute or statutes and any rule or rules involved, if known;
	  e.   	 Description of records or documents which were not available or were not presented to department personnel prior to the filing of the protest, if any, and provide copies of any records or documents that were not previously presented to the department;
	  f.   	 Any other matters deemed relevant and not covered in the above paragraphs;
	  g.   	 The desire of protester to waive informal or contested case proceedings if it is desired; unless the protester so indicates a waiver, informal procedures will be initiated;
	  h.   	 A statement setting forth the relief sought by protester;
	  i.   	 The signature of the protester or that of the protester’s representative, the addresses of the protester and of the protester’s representative, and the telephone number of the protester or the protester’s representative.
	  j.   	 Attach a copy of power of attorney for protester’s representative.
Upon receipt of the protest, the administrative law judge shall docket the protest in a docket kept for that purpose and shall assign a number to the case which number shall be placed on all subsequent pleadings filed in the case. An original and two copies of the protest shall be filed.
The protester may amend the protest at any time prior to the commencement of the evidentiary hearing. The department can request that protester amend the protest for purposes of clarification.
	 7.8(3) Denial of renewal of vehicle registration or denial of issuance or renewal, or suspension of driver’s license. A person who has had an application for renewal of vehicle registration denied or has been denied the issuance of a driver’s license or the renewal of a driver’s license, or has had a driver’s license suspended may file a protest with the department if the denial of the issuance or renewal or the suspension is because the person owes delinquent taxes.
The issues raised in a protest by the person, which are limited to a mistake of fact, may include but are not limited to:
	  1. 	 The person has the same name as the obligor but is not the correct person.
	  2. 	 The amount in question has been paid.
	  3. 	 The person has made arrangements with the department to pay the amount.