IRS Revises Rules for Communicating with Appeals Office

The Internal Revenue Service is asking for feedback on its plans to update its rules for how its Office of Appeals should communicate with other parts of the IRS about taxpayer disputes without the taxpayers or their representatives in the room.

The IRS said the updates are necessary because the IRS has changed some of its business practices and adopted new ones since the rules were originally issued in 2000. The rules address “ex parte” communications, which are communications between the Office of Appeals and other parts of the IRS that take place without the taxpayers or their representatives having an opportunity to participate in the communication.

The rules implement a provision of the IRS Restructuring and Reform Act of 1998, which are supposed to ensure that the Office of Appeals remain independent and flexible when it settles audit and collection-related disputes with taxpayers. The details are in Notice 2011-62, posted Tuesday on IRS.gov.

In one major change from the existing rules in Rev. Proc. 2000-43, the Appeals office will no longer be allowed to participate in issue management teams. However, the Appeals office can still be briefed by the teams, as long as the discussion remains generic rather than case specific. The meetings typically involve general discussions of how to handle technical issues or procedural matters, according to the IRS.

“Our mission is to impartially resolve tax disputes, without litigation, in a way that is fair to both the taxpayer and the government,” IRS Appeals Office chief Chris Wagner said in a statement. “We believe these updated rules will help us carry out that mission more effectively by providing everyone involved with the clear and consistent guidance they need.”

Comments on the proposed rules can be emailed to Notice.Comments@irscounsel.treas.gov with “Notice 2011-62” in the subject line.