§7123 Appeals dispute resolution procedures

Summary

The Secretary must create rules so a taxpayer can ask to move unresolved exam or collection issues early to the Internal Revenue Service Independent Office of Appeals. The Secretary must also set rules letting either the taxpayer or the Appeals office ask for non-binding mediation after appeals end or after failed attempts to reach a closing agreement (section 7121) or a compromise (section 7122). The Secretary must run a pilot program that lets a taxpayer and the Appeals office jointly ask for binding arbitration in those same situations. The Secretary must also make procedures for organizations that claim 501(c) status to request an administrative appeal (and a conference if they want one) to the Appeals office of an adverse determination. An adverse determination means a decision that is against an organization about any of these: whether it initially qualifies or continues to qualify as tax-exempt under section 501(a) or as the type in section 170(c)(2); whether it is or remains a private foundation under section 509(a); or whether it is or remains a private operating foundation under section 4942(j)(3).