Appeals Process: Collection Issues (Part 1)

Are you considering filing an appeal to the IRS regarding a tax issue? Wondering what happens after you file an appeal?

Here’s a quick overview of what you can expect. 

Of course, not every case is going to look the same. The time it takes to resolve an appeal depends on the facts and circumstances of your case. Consider this general information to get started understanding the appeals process.

What Happens During a Tax Dispute Appeal

Once you file an appeal, your case gets assigned to an Appeals Officer from the IRS’s Office of Appeals–an independent organization within the IRS that impartially handles appeals.

A conference is scheduled to review your case. Most conferences occur over the telephone. This is your opportunity to explain your position. 

Your Appeals Officer will review your case and consider your position, evidence, and arguments. The Officer will also review the IRS Compliance Division information that proposed or took the collection action against you.

In some cases, the case is reviewed and resolved during the conference call. Other times, you may need to provide additional evidence or documents. 

Any new information or evidence presented needs to be sent to the Compliance Division of the IRS for review and consideration. Your appeals officer will share any findings that come back from the review.

After the Appeals Officer finishes discussing your case with you, a recommendation is made to an Appeals Team Manager about how the case should be closed. 

The Appeals Team Manager reviews the recommendation. If the resolution is appropriate, the case will be approved. If not, the case is returned to the Appeals Officer to revise the recommendation based on the Team Manager’s input.

Important! If Your Appeal Is Dragging On…

While the Office of Appeals is considering your case, interest continues to add up on any unpaid balance you owe. 

Also, the Failure to Pay Penalty may also apply, which is 0.5% of the unpaid taxes for each month a tax remains unpaid.

If you have more questions about this, make sure you talk to your Appeals Officer or a tax professional helping with your appeal.

What If You Still Owe Money After the Appeal?

If you cannot pay your tax debt in full once after an appeal agreement, the IRS will use other collection methods including:

  • Installment Agreement: A payment plan that allows you to pay the amount due gradually.
  • Offer in Compromise: An agreement to pay less than the amount due, usually reserved for those who cannot pay a full tax liability without financial hardship.
  • Levy: A legal seizure of property such as wages, bank accounts, or cash.

Filing a Notice of Federal Tax Lien: The government’s legal claim against your property when you neglect or fail to pay your tax debt.

Getting Ready to File Your Appeal?

The IRS has four different appeal procedures. Check out part 2 of this series to learn which one you will need to use.

Also, it’s important to note, you can file the appeals request and go through the whole process on your own especially if you:

  • Have all the evidence and information to clearly support your position.
  • Are familiar with the appeals process or have a financial background.
  • Feel confident you could negotiate a better deal with the IRS.
  • Owe less than $50,000 to the government.

Doesn’t sound like you? No problem. 

If you want to know how your tax debt can be appealed or settled, then reach out to a team of tax professionals that deals with the IRS every day. 

Schedule a phone consultation to find out how the team at Confidential Tax Relief can help.