Where Appeals Fit and Which Paths Are on the Clock
The IRS Independent Office of Appeals is a neutral forum designed to resolve tax controversies without litigation, using a “hazards-of-litigation” analysis. Appeals handles both pre-assessment disputes (e.g., after an Exam “30-day letter”) and post-assessment collection matters (e.g., liens/levies through Collection Due Process). It also hears Offer in Compromise (OIC) rejections and many penalty disputes. Appeals’ mission, independence, and ex parte restrictions with Compliance are codified and implemented in the IRM.
Common On-Ramps to Appeals and Their Clocks
- Exam “30-day letter:” You typically have 30 days from the letter date to file a protest (full written protest or small-case request—generally for disputes ≤ $25,000 per period). If you miss it, Exam may issue a statutory notice (below).
- Statutory Notice of Deficiency (“90-day letter”): To keep a pre-payment forum, file a U.S. Tax Court petition within 90 days (150 if addressed to you abroad). Filing freezes assessment/collection on the deficiency while the case proceeds; many docketed cases still settle administratively.
- Collection Due Process (CDP): After a Final Notice of Intent to Levy or Notice of Federal Tax Lien filing, you generally have 30 days to request a CDP hearing (Form 12153). A timely CDP request stops new levies while Appeals considers collection alternatives; An equivalent hearing is generally available for up to one year from the CDP notice, but it does not suspend levy action and does not confer Tax Court review.
- Offer in Compromise (OIC) rejected: You have 30 days from the rejection to appeal the OIC (Form 13711).
- Math-error notices: Different track: you generally have 60 days to request abatement and force the IRS into routine deficiency procedures (which then bring the 90-day letter/Tax Court route if the IRS persists). IRS
Practical note: Follow the response deadline printed on your notice to preserve options; if you do nothing, the IRS can move your case toward assessment and collection.
The Protest and Intake Phase (Weeks to a Few Months)
If you’re still at the 30-day letter stage, your protest must identify the issues, facts, law, and your position, plus supporting documents. For small-dollar disputes, you may use a small case request; larger cases require a formal written protest. Appeals will acknowledge receipt, screen for jurisdiction/independence issues, and assign an Appeals Officer or Settlement Officer. Conferences are informal and can occur by phone, video, correspondence, or (where available) in person.
Once assigned, Appeals will set submission deadlines for your position papers and exhibits, and schedule a conference. Appeals must handle any non-ministerial contact with Compliance under Rev. Proc. 2012-18 and IRM 8.1.10 to preserve independence. Appeals may raise new issues in limited circumstances, but generally resolve cases on the existing record.
What a strong protest file includes (and why it accelerates resolution):
- A clean facts section tied to documents (GL-to-return cross-walks, bank-to-books schedules, strict-substantiation packets for § 274(d) items).
- Law & analysis that frames the hazards on both sides (competing authorities, evidentiary weaknesses) rather than advocacy alone.
- A settlement proposal (e.g., alternative computations) that Appeals can adopt if it agrees on hazards.
Conferences, Settlement Authority, and Timelines (Variable—Often a Few Months)
Appeals resolve cases by evaluating the litigation risk each side would face in court and aims to settle on that basis. You may have one or more conferences to refine facts, exchange computations, and negotiate. Appeals can sustain all, part, or none of the government’s position; in pre-notice of deficiency cases, Appeals may return the case to Exam to issue a notice if settlement fails. In docketed cases (after a Tax Court petition), the matter is under the court’s rules, but Appeals still handles many settlements in coordination with IRS Counsel.
Parallel collection relief: If you’re in Appeals on CDP, you must be current with filing/estimated tax to secure an installment agreement, Offer in Compromise, or Currently Not Collectible status. CDP outcomes issue via a Notice of Determination; you have 30 days to petition Tax Court if you disagree. CAP (Collection Appeals Program) can be faster for certain collection actions but does not provide court review.
How an Appeals Case Closes and What Happens Next
Outcomes include:
- Agreement (e.g., Form 870 waiver of restrictions), allowing immediate assessment/abatement consistent with the settlement; or a Closing Agreement (Form 906) for finality on agreed items.
- Sustained adjustment with notice of deficiency if you were pre-deficiency and no agreement is reached, triggering the 90/150-day Tax Court window.
- CDP Determination (granting or denying collection relief). If adverse, you can petition Tax Court within 30 days.
- Docketed settlement documented through IRS Counsel and filed with the Tax Court as a stipulated decision; if no settlement, the case proceeds to trial.
Interest & deposits while you wait. If you’re contesting a proposed deficiency and want to stop underpayment interest from accruing on the disputed amount without conceding liability, consider a § 6603 deposit (revocable, designated) rather than a “payment.” A § 6603 deposit is not considered a payment until it is applied; designate it in writing to suspend underpayment interest on the deposited amount. If you’ve already been assessed and are in refund posture, different statutes apply, and Appeals can still review disallowances before you consider refund litigation. (See Pub. 556 for exam/appeal/refund claim mechanics.)
Keep it Civil: Presentation, Privilege, and Avoiding “Eggshell” Missteps
Appeals is not a second audit, but your file quality drives outcomes. A coherent narrative, reconciled numbers, and credible documentary support shorten timelines and strengthen your hazards case. If any facts raise willfulness concerns (unfiled years, false documents, cash irregularities), do not front your original preparer: communications with non-attorney preparers are not privileged. Place the matter under attorney–client and work-product protection and extend privilege to consulting CPAs via a Kovel arrangement. That lets you cooperate while controlling the record which is often the difference between a fast, favorable Appeals resolution and a case that drifts toward penalties or, in worst cases, a life-altering criminal tax referral.
Contact the Tax Law Offices of David W. Klasing if Your IRS Appeal is on the Clock
At the Tax Law Offices of David W. Klasing, our dual-licensed Criminal Tax Defense Attorneys & CPAs draft persuasive protests to 30-day letters, preserve your pre-payment forum by timely petitioning the U.S. Tax Court within 90 days of a Notice of Deficiency (150 days if addressed abroad) under IRC § 6213, and meet Collection Due Process timelines (request within 30 days of a levy or lien notice and, if needed, petition within 30 days of the CDP Notice of Determination under IRC § 6330(d)(1)). For collection issues outside CDP, we leverage the Collection Appeals Program (CAP) for speedy, non-judicial review (understand: CAP decisions aren’t petitionable). We also appeal Offer in Compromise rejections (generally within 30 days) and negotiate docketed settlements after a Tax Court petition is filed. Throughout, we keep communications privileged (attorney-client/work-product) and extend privilege to consulting accountants via Kovel, so you get the accounting horsepower without sacrificing confidentiality.
Substantively, we control the record: build defensible computations, reconcile books to returns, and frame penalty relief (reasonable cause, first-time abate) before the file reaches Appeals. We insist on Appeals’ independence and compliance with ex parte restrictions, and we present a tight narrative that aligns with authoritative guidance (e.g., Pub. 5 on Appeal Rights, Pub. 556 on Exam/Appeals/Refunds, Pub. 1660 on CDP & CAP). Whether your clock is a 30-day letter, a 90/150-day deficiency deadline, a CDP window, or an OIC appeal, we move quickly to secure the proper forum and to negotiate a civil resolution that protects cash flow and your rights. Call 800-681-1295 or contact us online HERE for a reduced-rate consultation.
