Introduction to Appeals

1. Introduction to Appeals October 2008

2. Appeals 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.

3. IRS Organization Chart Director, Research, Analysis, and Statistics Chief Counsel Chief, Communications and Liaison Chief, EEO and Diversity Commissioner Chief of Staff Director, Office of Privacy, Information Protection & Data Security Acting Commissioner, Small Business/ Self-Employed Chief Information Officer Chief Financial Officer Chief Human Capital Officer Commissioner, Wage and Investment Commissioner, Large and Mid-Sized Business Commissioner, Tax Exempt and Government Entities Chief, Criminal Investigation Director, Office of Professional Responsibility Director, Whistleblower Office Chief, Agency-Wide Shared Services Deputy Commissioner Services and Enforcement Deputy Commissioner Operations Support Chief, Appeals National Taxpayer Advocate

4. Appeals Organization Chart Chief, Appeals Deputy Chief, Appeals Director, EEOD (AWSS) Director, Art Appraisal Services Director, Communications Director, Strategy and Finance Director, Technical Services Director, International Director, Field Operations – East Director, Field Operations – West Strategic Planning/ Measures Analysis Area 7 - Houston Technical Guidance Area 1 - Manhattan Tax Policy & ProcedureCollection & Processing Area 8 - San Francisco Area 2 - D.C. (Collection) Management and Administration Area 9 - Riverside Area 3 - Nashville Tax Policy & Procedure Exam, TE/GE,& ADR Finance ATCL – Los Angeles Area 4 - Philadelphia Processing Business Systems Planning TCS - Plantation Appeals Quality Measurement System Learning & Education

5. Appeals Field Operations Alaska Area 8 Area 3 Area 1 Maine Washington North Dakota VT Minnesota Montana NH New York MA Oregon BRC Campus Wisconsin South Dakota Idaho CT RI Michigan Pennsylvania Wyoming Iowa Northern California PHC Campus NJ D.C. Ohio Nebraska MD OGC Campus DE Illinois Indiana Nevada CIC Campus FRC Campus WV Virginia Colorado Utah Kansas Missouri Kentucky North Carolina Tennessee Southern California MEC Campus Oklahoma South Carolina Arizona New Mexico Arkansas Area 2: Collection (all Collection cases from Areas 1, 3, 4) Georgia Alabama Hawaii Mississippi Texas Louisiana Area 9 Florida Area 4 Area 7

6. Guiding 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

7. 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)

8. Types 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

9. Sources 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

10. 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

11. The 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

12. 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

13. 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

14. Alternative Dispute Resolution • Early Referral • Fast Track Mediation • Fast Track Settlement • Post-Appeals Mediation • Arbitration

15. Our Employees – Appeals Officers

16. Our Employees – Settlement Officers

17. www.IRS.gov/Appeals