Before the IRS can take collection action against a taxpayer, the taxpayer must be given an opportunity to appeal. A taxpayer can appeal issues related to assessment of the Trust Fund Recovery Penalty, Offers in Compromise, abatement of penalty assessments, levy action, jeopardy levies, filing of a Notice of Federal Tax Lien, and rejection or termination of an installment agreement.
The due process appeal gives the taxpayer the opportunity for an “independent review” of the proposed action by the IRS. Of course, the review is conducted by an IRS employee, so it is a case of the IRS reviewing the proposed actions of the IRS; however, most appeals officers are fair and impartial. In most cases, collection actions are suspended while an appeal is pending.
The taxpayer, or a representative, has the opportunity discuss the case with an appeals officer which is the only opportunity to discuss all relevant issues on a one-on-one basis with, hopefully, an “impartial” party. The appeals officer has the authority to reverse the decisions made by the Revenue Officer and/or his/her manager. The decision of the appeals/settlement officer is final.
It is critical that you have a representative who is familiar with the proper procedures and can present your case to benefit you and not the IRS. Appeals conferences are informal and can be conducted in person or by telephone. There are very specific time requirements for filing appeals. If the proper procedures are not followed, you can lose your appeal rights.
If you have received a notice from the IRS threatening to take action against, you please call. Remember, consultations are always free!