Learn about the fundamentals of the IRS’ collection appeals program as well as the practical knowledge and skills needed by Circular 230 practitioners working collection cases involving appeals. This presentation includes information on the Collection Due Process (CDP) and Collection Appeals (CAP) programs, including how to initiate each, appropriate timing and use, as well as what should be accomplished in the course of each appeal. You'll also be able to read about CDP and CAP’s limitations in addition to other appeal programs.

1. C O L L E C T I O N A P P E A L R I G H T S
20/20 Tax Resolution
D E C E M B E R 1 5

2. TODAY’S PRESENTER
- Consultant with 20/20 Tax Resolution, Inc.
- Over 18 years of tax resolution experience
- Works nationally as a taxpayer representative, focusing on state
and IRS collections
- Active educator of other tax practitioners on a national level
- Published in the EA Journal (most recently in the spring / summer
2015 edition)
- Has been interviewed relating to a range of tax topics for various
news articles as well as Denver television
- Served as an instructor at the 2011 - 2015 NTPI conferences
- Currently serves on the NAEA’s Government Relations and
Education committees
D a v i d F . M i l e s , E . A .

3. WEBINAR
INTRODUCTION
This webinar will focus on the Collection Due Process (CDP) and Collection Appeals
(CAP) programs, including how to initiate each, appropriate timing and use, as well as
what should be accomplished in the course of each appeal. We will touch on other
appeals as well.
✓ Identify what proposed or actual actions taken by the Collection Division are appealable to the Appeals Division.
✓ Successfully navigate relevant sections of the Internal Revenue Manual (IRM), notably Part 8 and Part 5.
✓ Examine the scope of authority of the Appeals Division on Collection enforcement issues.
✓ Discuss if enforcement actions by Collection Division employees may be appealed through other avenues and what those avenues are.
✓ Identify what actions must be taken, and what forms must be filed to file a proper and timely request for a Collection Appeal.
✓ Highlight what information is needed to file an effective appeal.
OBJECTIVES:

4. A P P E A L S O V E R V I E W
- Independent of any other IRS office and provides a venue where
disagreements concerning the application of tax law can be resolved on a
fair and impartial basis for both the taxpayer and the government.
- Taxpayer Bill of Rights (TBOR)
- Independence is the most important of Appeals’ core values
✓ The Right to Be Informed
✓ The Right to Pay No More than the Correct Amount of Tax
✓ The Right to Challenge the IRS’ Position and Be Heard
✓ The Right to Appeal an IRS Decision in an Independent Forum

5. A P P E A L S O V E R V I E W ( c o n t i n u e d )
- Less formal and less costly than court proceedings (not subject to judicial
rules of evidence or procedure)
- Commitments from Appeals
✓ Explain Appeal rights and the Appeals process
✓ Listen, be courteous and professional
✓ Timely and responsive
✓ Fair and impartial

6. H I S T O R Y O F A P P E A L S
- Formed in 1927
- Mission has remained the same:
- IRS Restructuring & Reform Act of 1998 (RRA) tasked, in part, with
maintaining Appeals’ independence.
✓ To resolve tax controversies, without litigation, on a basis which is fair and impartial to both the Government
and the taxpayer in a manner that will enhance voluntary compliance and public confidence in the integrity
and efficiency of the Service.
✓ Enhanced taxpayer advocate independence
✓ Prohibited ex-parte communication
✓ Created Collection Due Process Hearing

7. H O W H A S A P P E A L S D E V E L O P E D
S I N C E R R A 9 8 ?
- Protection from Collections even when it may not appear necessary
- Do not rely on client or Collections when it comes to enforcement
- Potential to win
L O O K I N G B A C K
✓ Although some of the randomness attributed to past decisions has been lost to
programs such as AJAC, it is still possible to achieve a favorable resolution when
you least expect it.
- Many asking if it’s time to restructure again
- Continued IRS budget cuts and impact on service

8. A P P E A L S J U D I C I A L A P P R O A C H & C U L T U R E
- Mission: Reinforce Appeals’ quasi-judicial approach to how it handles
cases, with the goal of enhancing internal and external customer
perceptions of a fair, impartial and independent office of Appeals.
- Phase 2 began July 2014
- Not developing case facts, but instead, ruling on the appeal of a specific
issue
- New information from taxpayer or representative remains relevant

9. C O L L E C T I O N A P P E A L R I G H T S
- The right to appeal Collection actions, proposed or taken.
- Collection Due Process (CDP)
- Collection Appeal Program (CAP)
✓ IRC Section 6320 – Liens
✓ IRC Section 6330 – Levies
✓ IRC Section 7122 – Installment Agreement Rejections, Modifications & Terminations
✓ Actions proposed or already taken, i.e., lien, levy, seizures
- IRS requirement to notify taxpayers of all available
Collection Appeal Rights

10. U N D E R S T A N D I N G
C O L L E C T I O N D U E P R O C E S S ( C D P )
- Restructuring & Reform Act of 1998 (RRA) established
Collection Due Process for levies under IRC 6330 and
liens under IRC 6320.
- Requested using Form 12153. A request can also be made
in letter form, but it must include certain elements to
qualify. Form 12153 is safer and easier.
- Must be filed within 30 days of letter date. Usually filed in
response to the following letters:
- CP 90: Intent to Levy
- CP 297: Intent to Levy
- LT 11: Intent to Levy
- Letter 1058: Intent to Levy (issued by Revenue Officers)
- Letter 3172: Notice of Lien
- Timeliness determination

11. C o l l e c t i o n D u e P r o c e s s ( c o n t i n u e d )
- Disagreeing with decision
✓ Lien withdrawal
✓ Installment Agreement
✓ Offer in Compromise
✓ Currently Not Collectible
✓ Tax Court
✓ Decision belongs to taxpayer
✓ Lose right to judicial review
✓ Filed using Form 12256 or a written request (*not required on EH Appeal)
- Face-to-face hearing
- Alternatives: Whether the action taken or proposed balances the
governments need for the efficient collection of taxes with the taxpayer’s
legitimate concern that any action be no more intrusive than necessary.
- Withdrawing Appeals

12. R E A S O N S T O F I L E
- The opportunity to consider alternatives prior to levy
- Collection hold
- Evaluate extenuating circumstances related to lien filings
- Provides opportunity to elevate case to Tax Court
- Fresh set of eyes on case
- Potential for more qualified IRS representative
- Time: can allow other issues and / or circumstances to develop

13. T H I N G S T O C O N S I D E R B E F O R E F I L I N G
- Requesting a CDP puts the Collection Statute on hold
- Extends the 3 year & 120 day periods for dischargeability in bankruptcy
- Some Revenue Officers refuse to continue working the case
- Realizing a resolution plan can take longer

14. E Q U I V A L E N T H E A R I N G ( E H )
- Filed on Form 12153
- After CDP’s 30 days, but before 1 year from lien or levy notice
- Resolution alternatives considered
- No Tax Court recourse
- Does not guarantee a collection hold, although usually honored –
especially by ACS
- Does not affect bankruptcy dischargeability

15. U N D E R S T A N D I N G
C O L L E C T I O N A P P E A L S P R O G R A M ( C A P )
- Appeal program available to taxpayers or third parties
whose property is subject to collection action:
- May not be heard under CAP:
- Levy action that has been or will be taken
- NFTL that has been or will be filed
- Special condition NFTL’s
- Rejected, terminated or proposed for modification Installment
Agreements (statutory)
- Denial of lien certificates
- Disallowance of returned levied properties
- Pre or post Trust Fund Recovery Penalty
- Rejection of Offer in Compromise
- Penalty appeals
- Audit reconsideration
- Jeopardy levy
- Claims for refund or abatement
- Original requests for return of levied property

16. - Quick Process: Request for group manager meeting. Reply expected
within two days. If no agreement following conference, revenue officer or
manager must be notified within two days of intent to appeal. CAP, Form
9423, postmarked within three days to avoid collection. Still entitled to
CAP but not collection hold if not received within three days. Appeals is
then instructed to make decision within five business days (15 days if
complex) of receipt of case.
✓Group manager meeting not required in Installment Agreement cases since the right to
CAP is statutory. But, it is encouraged.
C A P P R O C E S S

17. - Collection Alternatives: None. Appeals is directed to review law, regulation policy &
procedure, only.
- Withdrawing Appeals: Can be done by simply providing a statement in writing. Not
usually relevant but could become necessary if agreement reached with Collections.
- In cases of Installment Agreements, CAP must be requested within 30
days of proposed or actual action
- In cases of seizure only, CAP must be requested within 10 days of
seizure notice
- Except for seizures and Installment Agreements (noted above), no
other CAP deadlines exist
C A P N U A N C E S

18. C O L L E C T I O N A P P E A L S P R O G R A M ( c o n t i n u e d )
- Be mindful of:
✓Ex parte communication
✓General stay of collection (including lien filing) during appeal
✓Collection may resume upon receipt of decision of Appeals
✓Decisions are binding on taxpayer and Collections

19. O T H E R T Y P E S O F
C O L L E C T I O N A P P E A L S
- Trust Fund Recovery Penalty (TFRP) / IRM 5.7.4.7 / 8.25.1
✓ Small v. large case requests
✓ Letter 1153 & Form 2751
- Audit Reconsideration / Publication 3598
- Offer in Compromise / IRM 8.23
✓ Within 30 days of rejection. Use Form 13711 or in writing requires inclusion of specific information.
- Alternative Dispute Resolution Program / IRM 8.26
✓ Fast Track Mediation
✓ Post-Appeals Mediation

20. W H O W I L L H E A R A P P E A L & W H E N ?
- Who?
✓ Appeals Officer
✓ Settlement Officer
✓ Campus Appeals – Appeals Tax Specialist (penalty cases)
✓ Appeals Account Resolution Specialist (AARS)
A P P E A L P R I O R I T I E S
- When?
✓ Assigned, in part, by minimum GS level for issue
✓ CAP cases:
- Priority given to pyramiding employment tax cases
- Lien, levy, seizure
- Installment Agreement rejections, modifications or terminations

21. A P P E A L S W O R K L O A D S N A P S H O T
*Indicates end of 2014 Fiscal Year; September 30, 2014

22. W H A T Y O U S H O U L D K N O W
P R E P A R I N G F O R A P P E A L
- To decide if you should appeal your tax dispute, consider:
✓ If you believe the IRS made an incorrect decision based on misinterpretation of the
law, check the publications discussing your issue(s), or refer to ‘Tax Topics’ on IRS
website.
✓ If you believe the IRS did not properly apply the law due to a misunderstanding of
the facts, be prepared to clarify and support your position.
✓ If you believe the IRS is taking inappropriate collection action against you, or your
offer in compromise was denied and you disagree with that decision, be prepared to
clarify and support your problem.
✓ If you believe the facts used by the IRS are incorrect, then you should have records
or other evidence to support your position.

23. W R A P - U P : A S K Y O U R S E L F
- Will the IRS consider rescinding the letter that was issued?
- What are appropriate collection or assessment statutes of limitations for each year involved?
- Has the client filed bankruptcy, an OIC, or any prior requests for CAP or CDP relief for the tax
periods in question?
- Is the client currently in compliance with tax filing and payment requirements?
- Is there any reason to believe that the underlying liabilities are incorrect?
- Has the client had the chance to challenge the underlying liabilities?
- Has the IRS complied with all the appropriate laws and procedures relative to the attempted
enforced collection actions?
- Are there any extraordinary issues that need to be brought to the attention of the Appeals or
Settlement Officer such as health, significant economic factors, loss of employment, etc.?

24. Provide client education on various Appeal opportunities, which may be critical to successful
results.
Ensure that clients’ appeal rights are properly considered in order to maximize benefit and
minimize risk.
Prepare clients for possibilities outside of those presented by Collections.
O P P O R T U N I T I E S
Navigate client case files to vet pros and cons of Appeals in order to serve
relationships more effectively while simultaneously accomplishing clients’ goals
within appropriate time frame.

25. Do you need
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