In a previous blog (here), we discussed some suggestions for representing taxpayers in a IRS examination. In this blog, we discuss the next step, i.e., when the exam cannot be resolved and you must make a request for review by an IRS Appeals Officer. Most of the suggestions in the previous exam blog are applicable to working with IRS Appeals and will not be repeated here. If you are representing a taxpayer in an appeals conference, you should review the previous blog and the suggestions below.
1. Contents of the protest.
a. Address what is in the examination report.
b. Do not address issues not in the examination report.
c. Tell the story with a theme.
d. Use alternative arguments.
e. If you do not have enough time to file a complete protest, file a skeletal protest and
2. Be sure the appeals officer understands the facts. You and your client should have
better access to the facts and you should use that to your advantage.
3. If the examining agent files a rebuttal report, ask for a copy.
4. Always remember appeals’ greatest weakness: the inability to do independent
investigation. However under the Appeals Judicial Approach and Culture (AJAC), if the
taxpayer raises new issues or provides new evidence, the case will be returned to the
examiner for consideration of the new issues or evidence.
5. Never forget appeals’ greatest strength: the ability to enter into risk of litigation
settlements. The protest and any presentations, discussions or arguments should be
directed toward convincing the IRS Appeals Officer that the government faces a significant
possibility of losing the case if it litigates the matter.
6. Do not give away loser issues too quickly. All issues are potential bargaining chips
and should not be discarded casually.
7. File a Freedom of Information Act Request. You might find some usable information,
including copies of the examining agent’s notes.
8. Ask for a copy of the administrative file. Do so if you did not receive it in the FOIA
9. Every meeting is a chance for discovery. Talking with the IRS Appeals Officer can
result in usable information that is being considered in the present case or some other
case Involving common issues. If you did not previously ask for a copy of the
administrative file, ask to look through it at the initial meeting. Review anything they
10. Consider making a Qualified Offer to Settle the Case. A Qualified Offer increases
the possibility of a prevailing taxpayer recovering legal fees and increases the pressure
on the government to settle.
11. Shift the burden of proof to the IRS by complying with the provisions of IRS
Section 7491. This also increases the pressure on the government to settle.
If you have any questions related to this or any other civil tax or criminal tax-related matter, please feel free to contact Joel Crouch at (214) 749-2456 or firstname.lastname@example.org.