Jeffrey M. Rosenblum, P.C.
A Fresh Start

Take the fast track to resolving your IRS tax dispute

Most people deal with the IRS once a year when they file their tax returns. However, if you are like many taxpayers here in New York, you continue to deal with the IRS because the agency claims you owe more money than you believe you do. The IRS launches an investigation into your financial life looking for sources of payment, and you disagree with its assessment. So what do you do next?

Nearly everyone hears horror stories about the collection efforts of the IRS, along with the fact that it might take years to resolve an issue. You might not realize that you do not always have to accept what the IRS tells you without making the agency prove the supposed case against you. The IRS makes mistakes and overreaches more often than many people know.

Streamlining IRS dispute decisions

Fortunately, the IRS instituted a new fast track mediation option that might shorten the time you spend dealing with your tax dispute. The best time to use this option is before IRS Collections makes a final decision regarding your case and after the exchange and discovery of all of the information relevant to the issue.

Specially trained IRS employees in the Office of Appeals serve as mediators in this program. You do not present your case to a judge at this point, and neither you nor the IRS is bound by the decision, which means that you could still end up in litigation over your dispute.

Does my dispute qualify for fast track mediation?

The fast track mediation program limits the types of cases it handles to those that involve disputes over the following:

  • Your liability
  • The value of your assets
  • The inclusion of certain dissipated assets
  • The amount of your interest from certain assets
  • Projections of your income in the future
  • Future living expenses you share with your non-liable spouse
  • Deviations from the national or local standards for expenses

Other questions regarding assessments made by the collections agents at the IRS might also qualify for the program. For instance, you might need to prove that your employer makes it mandatory to contribute to a retirement account if the IRS believes they are voluntary contributions.

The following matters make your case ineligible for fast track mediation:

  • Collection due process cases
  • Collection appeals program cases
  • Department of Justice referrals
  • SB/SE Campus site cases
  • Litigation and mediator authority questions

If you failed to respond to IRS inquiries or communications, including requests for information, you may not use the program. Even though shortening the time required to resolve a tax dispute remains a goal of the program, delays occur periodically. Ordinarily, those delays stem from the presentation of new or voluminous documentation or the addition of new witnesses.

Solid preparation

Like any other dispute with the IRS, entering into this process without adequate representation could prove disastrous for you. A tax attorney understands the tax code and IRS procedures. Even if you use the fast track mediation program, the possibility of litigation remains. An attorney who also litigates tax disputes would more than likely prepare for litigation from the start in order to represent you best.

Many people wait until their tax matters spiral into a full-blown tax dispute before involving an attorney. It might be beneficial to speak with an attorney before your case reaches this point so that you have the opportunity to take advantage of his or her experience and knowledge, including whether a way exists to settle the dispute before it ends up in court.

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