So what are some of these new procedures or rules? One, with no new problems. Therefore, if the examination did not raise the problem, then the appeal should not raise the issue. Therefore, if the taxpayer files appeals, based on a research and development topic, they should not expect the appeals to say: Well, the review should have raised the question of transfer pricing and we will do it now. That's not going to happen.
The second is that, we have all faced this, in which, for whatever reason, the test makes an adjustment to the taxpayer's tax return, but even so, in an undeveloped way. Maybe they didn't develop the facts. Maybe they didn't develop the law. In previous years, when that case reached appeals, appeals simply returned it to review for further development.
Now, the appeals will try to resolve that case in the light of the undeveloped facts or law, as stated in the review. Appeals can contact the Tax Court and, if they haven't had a previous opportunity, to try to resolve their case through appeals. For additional information on the structure and leadership of the IRS Independent Appeals Office, see the appeals organization graphic in PDF. The appeals recently announced changes to their conference procedures that give the ATCL the exclusive power to invite Compliance (and the IRS lawyer who advised it) to an appeals conference and to require the taxpayer to participate in a joint discussion of the case with him.
The IRS Examination or Collection Office that conducted a tax assessment or initiated a collection action will consider your protest and attempt to resolve the disputed tax issues. Finally, the announcement states that the ATCLs considered that the Initiative allowed them to better maintain their impartiality, since they could directly request Compliance to respond to the taxpayer's arguments. If you've had difficulty dealing with the IRS or have questions about your tax issues that the IRS hasn't been able to resolve after several attempts, you can contact your local Taxpayer Advocate office for assistance. Large taxpayers may wonder if it will be effective to oppose the ATCL's decision to invite Compliance (and the IRS lawyer who advised Compliance) to participate in an appeals conference.
For information on each function and a functional point of contact, see the appeals organization chart in PDF. In the first of a series of videos focusing on tax disputes, Chuck Hodges, Jones Day partner and tax litigator, analyzes the AJAC Project and how it can affect the strategies of companies working to resolve disagreements with the IRS. To improve the timeliness of the settlement process, Appeals has begun to initially contact certain taxpayers (or the taxpayer's authorized representative, if any) by phone (PDF). For more information on the average time frames for unfiled cases, visit the Independent Appeals Office's Customer Satisfaction Surveys.
If you've had difficulty dealing with the IRS or have questions about your tax issues that the IRS hasn't been able to resolve, you can contact your local Taxpayer Advocate office for help. However, the appeals refused to require taxpayer consent, citing the “policy” since at least 1967 that appeals have the discretionary power to invite Compliance and the desire to avoid replacing the ATCL judgment with the taxpayer's judgment on how the ATCL should familiarize itself with the case. Traditionally, Appeals contacts the taxpayer by mail offering to discuss the possible solution of the case.
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