The Internal Revenue Service’s Office of Appeals has announced that it will soon unveil a pilot project affording taxpayers and their representatives the opportunity to have a “virtual” face-to-face option for taxpayer conferences. Currently, taxpayers requesting an Appeals conference have the opportunity to conduct such conference by telephone, in person (referred to as a “face-to-face” conference), or virtually through videoconference technology which is available at only a limited number of IRS offices. Each year, the Office of Appeals hears appeals of more than 100,000 taxpayers attempting to resolve their tax disputes without going to court.

In our experience, “face-to-face” conferences with Appeals are far superior to telephonic conferences and are more likely to facilitate settlements. As a result, we almost always request an in-person meeting with Appeals. However, as of October 1, 2016, the IRS revised the Internal Revenue Manual provision governing Appeals conferences to instruct Appeals Officers to hold conferences by telephone in nearly all cases. This decision was no doubt motivated by the dramatic budget cuts that the IRS has endured for the past several years and its corresponding dwindling workforce. The agency’s announcement that “virtual” conferences will be offered is apparently its attempt to meaningfully restore the “face-to-face” (albeit virtual) option for taxpayer conferences.

Under the revised Internal Revenue Manual provision, a telephonic Appeals conference shall be held unless the following criteria are satisfied:

• There are substantial books and records to review that cannot be easily referenced with page numbers or indices;
• The Appeals Officer cannot judge the credibility of the taxpayer’s oral testimony without an in-person conference;
• The taxpayer has special needs (e.g. disability, hearing impairment) that can only be accommodated with an in-person conference;
• There are numerous conference participants (e.g., witnesses) that create a risk of an unauthorized disclosure or breach of confidentiality;
• An alternative conference procedure (e.g., Post Appeals Mediation (PAM) or Rapid Appeals Process (RAP)) involving separate caucuses will be used;
• Another IRM section specific to the workstream calls for an in-person conference.

I.R.M. § 8.6.1.4.1.

According to the IRS announcement, the “virtual” conference option will utilize a secure, web-based screen-sharing platform to connect with taxpayers from anywhere they have internet access. The IRS expects it to be especially useful for taxpayers located far from an IRS Appeals office.

“Taxpayers who choose the web-based option will be able to get face-to-face service remotely,” said IRS Chief, Appeals Donna Hansberry. “In the future, the technology may give taxpayers greater options in engaging with Appeals and could allow us the flexibility to serve taxpayers virtually from any location using mobile devices or computers.” “We hope this is one more option to enable IRS employees to provide timely, efficient and effective service to taxpayers,” said Hansberry. The IRS plans to start the pilot project on August 1, 2017 and will assess the results, including taxpayer satisfaction with the technology.

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