NJ chapter briefed on IRS initiatives.

• Position: Chapter News

Summary

On May 23, 2011, representatives of the New Jersey Chapter sat down with representatives of the IRS's Large Business & International Division and Appeals for a discussion of initiatives surrounding the audit and appeals processes. IRS representatives included a Director of Field Operations, Territory Managers, Team Managers, Coordinators, Supervisors, and Economists. These representatives gave excellent presentations on the following areas: Fast Track, APA/Transfer Pricing, UTP, CAP, and Tier I issues. The IRS is having great success with these initiatives and encourages all affected taxpayers to consider the programs.

Presentations

The first presentation, the Fast Track program, was given by Linda Colemon (Appeals Fast Track Program Manager--East) and Robert Kabacinski (Appeals Team Manager). This joint Compliance and Appeals process is enjoying an 83 percent success rate. The program enables taxpayers and the IRS to work together to resolve outstanding issues while the case remains in the jurisdiction of LB&I. The Fast Track process is designed to be completed in approximately 120 calendar days utilizing mediation techniques and Appeals' settlement authority. The use of these mediation techniques leads the taxpayer and LB&I to self-determine the outcome of the issues in dispute.

Either party can initiate the process at any time after an issue is fully developed. An issue is generally considered "fully developed" when Form 5701, Notice of Proposed Adjustment (NOPA), has been issued to the taxpayer clearly setting out the government's position and the taxpayer has prepared a written response defining their position and the basis for disagreement.

Once a case is in Fast Track, the expectation is that all issues and claims were raised, all relevant information was disclosed, and the case is ready for resolution. All "decision-makers" are required to be present at the Fast Track session and all parties must be settlement-minded.

The Fast Track session calls for an initial joint session, breakout sessions (where negotiations and settlement offers can be discussed with each party separately) and ultimately a closure session. All separate breakout session discussions are confidential and information can only be shared if permitted by the respective party.

The Appeals mediator may ultimately make recommendations regarding the settlement of any or all issues (both factual and legal). If acceptable to both parties, the settlement proposal is...