IRS Launches Fast Track Appeals Service After Successful Pilot

by Leroy Baker, Tax-News.com, New York

08 April 2003

The Internal Revenue Service (IRS) has implemented a "fast track" appeals system for its Large and Mid-Sized Business Division aimed at speeding up the process of dispute resolution.

This follows a successful pilot scheme in which the IRS reached agreement with taxpayers on 91% of issues. On average, disputes took one tenth of the time to resolve that ordinary settlements usually take.

To get the ball rolling earlier on potential disputes, an appeals officer is assigned to mediate in a case even before the audit is over, meaning that the vast majority of issues can be resolved much earlier, rather than weeks, months or in some cases, years after the audit.

However, the Fast Track Settlement, or FTS, does not replace the taxpayers' right to a traditional appeals procedure, and is there to augment the existing dispute resolution process, according to the IRS. The taxpayer therefore retains the right to a conference with a manager of a hearing before Appeals.

The role of the Appeals officer in FTS cases is to act as a neutral third party and help the taxpayer or firm understand the exact nature of the dispute facing them. The officer then offers possible solutions which would allow movement towards settlement of the dispute. However, either party may withdraw from the FTS process if it is felt that little or no progress is being made towards resolving outstanding issues. At the conclusion of an FTS case, the taxpayer or firm retains the normal rights of appeal should they not be entirely satisfied with the process.

Recommended