October 2008

Introduction Introduction to Appealsto Appeals

Introduction Introduction to Appealsto Appeals

2OFFICE OF APPEALS

AppealsAppeals

Founded

In 1927, the IRS established an administrative appeal process to resolve tax disputes without litigation.

Restructuring and Reform Act of 1998

Specifies that the IRS reorganization plan must “ensure an independent appeals function within the Internal Revenue Service, including the prohibition in the plan of ex parte communications…”

Section 1001(a)(4).

Mission

Resolve tax controversies, without litigation, on a basis which is fair and impartial to both the government and the taxpayer and in a

manner that will enhance voluntary compliance and public confidence in the integrity and efficiency of the Service.

3OFFICE OF APPEALS

Commissioner

Chief of Staff

Deputy Commissioner

Operations Support

Acting Commissioner,Small Business/ Self-Employed

Chief Information Officer

Chief Counsel

Chief, Appeals

National Taxpayer Advocate

Chief Financial Officer

Chief Human Capital Officer

Chief,Agency-Wide

Shared Services

Commissioner,Wage and Investment

Commissioner,Large and Mid-Sized Business

Commissioner,Tax Exempt and

Government Entities

Chief,Criminal

Investigation

Chief, EEO and Diversity

Chief, Communications and Liaison

Director, Office of Professional

Responsibility Deputy CommissionerServices and Enforcement

Director, Research, Analysis, and Statistics

Director, Whistleblower Office

Director, Office of Privacy, Information Protection & Data

Security

IRS Organization ChartIRS Organization Chart

4OFFICE OF APPEALS

Chief, Appeals

Director, EEOD (AWSS) Director, Art Appraisal Services

Director, Communications

Director, Strategy and Finance

Strategic Planning/ Measures Analysis

Management and Administration

Finance

Business Systems Planning

Appeals Quality Measurement System

Learning & Education

Director, Technical Services

Director, Field Operations – East

Area 1 - Manhattan

Area 2 - D.C. (Collection)

Area 3 - Nashville

Area 4 - Philadelphia

Director, Field Operations – West

Area 7 - Houston

Area 8 - San Francisco

Area 9 - Riverside

ATCL – Los Angeles

TCS - Plantation

Technical Guidance

Tax Policy & ProcedureCollection & Processing

Tax Policy & Procedure Exam, TE/GE,& ADR

Processing

Director, International

Deputy Chief, Appeals

Appeals Organization ChartAppeals Organization Chart

OFFICE OF APPEALS

D.C.

Washington

Oregon

Northern California

Nevada

Idaho

Montana

Wyoming

Utah

Arizona

Colorado

New Mexico

Texas

Oklahoma

Kansas

Nebraska

Arkansas

Louisiana

Alabam

a

Mississippi

Florida

Georgia

SouthCarolina

North CarolinaTennessee

Kentucky

Virginia

South Dakota

North DakotaMinnesota

Iowa

Missouri

Illinois

WisconsinMichigan

IndianaOhio

WV

Pennsylvania

New York

Maine

VTNH

MA

NJ

CT

MD

Area 1Area 1

Area 4Area 4Area 7 Area 7

Area 8Area 8

Southern California

FRC Campus

OGC Campus

Area 3 Area 3

PHC Campus

MEC Campus

BRC Campus

CIC Campus

Area 9Area 9

Alaska

Hawaii

DE

RI

Area 2: Collection(all Collection cases from Areas 1, 3, 4)

Area 2: Collection(all Collection cases from Areas 1, 3, 4)

Appeals Field OperationsAppeals Field Operations

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Guiding Principles and Core ValuesGuiding Principles and Core Values

• Independence and Ex Parte• One Appeals• Getting the right work to the right employee

at the right time to get the right decision• Collaboration and Feedback• Innovation and Creativity

7OFFICE OF APPEALS

How Does Taxpayer Get to Appeals?How Does Taxpayer Get to Appeals?

• Collection Due Process (lien/levy)• Offer–in–Compromise• Innocent Spouse • Penalty Appeals• Coordinated Industry Cases• Industry Cases • Examination (non-LMSB)• Other (CAP, TFRP, FOIA, etc)

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Types of Case in AppealsTypes of Case in Appeals

• Examination– Audits– Claims for Refund/Abatement– Post-assessment Penalty Appeals

• Collection– Collection Due Process– Collection Appeals Program– Offers in Compromise– Trust Fund Recovery Penalty

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Sources of CasesSources of Cases

• Generated by Field Compliance – More complex issues– Requires more time to resolve– Complexity drives need for more technically

experienced employee

• Generated by Campus Compliance – Less complex issues– Requires less time to resolve– Easily resolved through correspondence or by

telephone

10OFFICE OF APPEALS

Offering a Fresh Look …Offering a Fresh Look …

• Supports an administrative dispute resolution process

• Supports a dispute resolution process that is separate and independent from Compliance

• Supports the joint goals of the government’s need for an efficient tax system and the taxpayer’s need to have their case fairly and impartially considered without having to go to court

11OFFICE OF APPEALS

The Appeals ProcessThe Appeals Process

• Compliance forwards a complete administrative case file

• Case is received by Appeals– Assigned by Appeals Team Manager to an

Appeals employee – “Welcome to Appeals” letter issued

• Quality review of case file by Appeals employee assigned the case

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The Appeals Process (cont’d.)The Appeals Process (cont’d.)

• Appeals employee considers – Facts – Tax Law– Treasury Regulations– Case Law – Revenue Rulings, Revenue Procedures, and other

technical guidance

• Appeals employee honors the prohibition against ex parte communications

• Communications with taxpayer– Correspondence– Telephone– Face to face conference

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The Appeals Process (cont’d.)The Appeals Process (cont’d.)

• Settlement considerations– Settlement authority– Hazards of litigation

• Negotiations complete– Fair– Impartial

• Managerial review

• Implementation of final resolution

• Case closed from Appeals

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Alternative Dispute ResolutionAlternative Dispute Resolution

• Early Referral

• Fast Track Mediation

• Fast Track Settlement

• Post-Appeals Mediation

• Arbitration

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Our Employees – Appeals OfficersOur Employees – Appeals Officers

Appeals Officers

Field Campus

Average Years of Service 28 24

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Our Employees – Settlement OfficersOur Employees – Settlement Officers

Settlement Officers

Field Campus

Average Years of Service 25 20

www.IRS.gov/Appeals