Proposed changes to administrative appeals review of “docketed cases”

Proposed changes to review of “docketed cases”

The IRS today released an advanced version of Notice 2015-72 that provides text of a “proposed revenue procedure” that would be issued to update existing IRS guidance with respect to the administrative appeals process for cases docketed in the U.S. Tax Court—“docketed cases.”

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Reasons for updated guidance

Notice 2015-72 [PDF 29 KB] explains the need for the updated guidance. The existing guidance—Rev. Proc. 87-24—was issued in January 1987, and since that time, the IRS has been reorganized several times and the volume of Tax Court cases has increased. The IRS also has adopted new policies and procedures for more efficient management of its work load, and the new guidance would help manage the flow of docketed cases between the offices of IRS Appeals and IRS Chief Counsel. 

Proposed revenue procedure

The proposed revenue procedure would not “materially modify” the current practice of referring docketed cases to Appeals for settlement (as currently followed in “the vast majority of cases”). Rather, the proposed revenue procedure would aim for docketed cases to be “handled consistently nationwide.” It also would allow for consideration of cases governed by IRS National Office rulings in employee plans and exempt organizations.

Also, the proposed revenue procedure would:

  • Clarify that docketed cases are to be referred to Appeals for settlement (except in rare circumstances)
  • Clarify procedures for cases and issues that are not to be referred to Appeals or for which additional time is needed before a referral is made to Appeals
  • Establish a “shared responsibility” policy for Appeals and IRS Chief Counsel and provide for coordination measures when the taxpayer raises a new issue in Appeals
  • Describe procedures for requesting Chief Counsel assistance when the case is in Appeals and procedures for handling and transferring custody of the administrative file for docketed cases to Appeals

The IRS has requested comments concerning the proposed revenue procedure; comments must be submitted by November 16, 2015.

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