IRS Post-Appeals Mediation Lawyer

Pursuing Post-Appeals Mediation (PAM) Can Be a Viable Option for Avoiding Litigation in the US Tax Court Following IRS Appeals

The Post-Appeals Mediation (PAM) program provides an opportunity for taxpayers to resolve tax disputes after unsuccessfully pursuing a traditional appeal with the IRS Appeals Office. Under the PAM program, taxpayers participate in an alternative dispute resolution (ADR) process focused on negotiating mutually agreeable tax assessment that avoids Tax Court litigation and IRS collection.

**Attorney Lynette Byrd**
Tax Fraud and Evasion Team Lead
Former DOJ Attorney

**Attorney Alina Veneziano**
Tax Attorney & CPA Team Lead

**Alice Campbell**
Tax Team Former Special Agent (IRS)

For individual and corporate taxpayers that are facing tax controversies with the Internal Revenue Service (IRS), seeking a resolution may eventually involve going to the IRS Independent Office of Appeals. The IRS Appeals process offers a means of resolution that does not involve pursuing costly litigation in the US Tax Court, and it focuses on resolving disagreements regarding the taxpayer’s tax debt as assessed by the IRS during its initial audit.

But, the IRS appeals process isn’t always successful.

When taxpayers are unable to achieve satisfactory resolutions through the traditional appeals process, they have a few options available. One of these options is to pursue Post-Appeals Mediation (PAM). Both individuals and business entities can pursue PAM, and PAM can be used to resolve a wide range of tax issues without judicial review even once an Appeals officer has failed to facilitate a resolution to a taxpayer’s case.

Seeking a Mediated Settlement After the IRS Appeals Process

The IRS appeals process is intended to allow taxpayers and the IRS to address differing interpretations of US tax law and taxpayers’ obligations thereunder. If an appeal is successful, it will result in a negotiated settlement with respect to the tax periods involved in the underlying audit.

If an appeal is not successful, the findings in the taxpayer’s IRS Notice of Deficiency remain in place. The taxpayer remains liable for any back taxes, interest charges, and civil penalties owed; and, if the taxpayer doesn’t pay, the IRS can pursue collection action as warranted.

In this scenario, taxpayers must continue to pursue the options they have available for protecting their best interests under the circumstances at hand. For some, this will involve pursuing settlement negotiations through the Post-Appeals Mediation (PAM) program.

Applying for PAM with the IRS Independent Office of Appeals

To pursue Post-Appeals Mediation (PAM), taxpayers must apply with the IRS Independent Office of Appeals. As the IRS explains, taxpayers must submit a written statement to their Appeals officer or settlement offer that includes both: (i) “a specific request for Post-Appeals Mediation;” and, (ii) “a written statement detailing their position on the disputed issue(s).”

When applying for PAM, submitting adequate supporting documentation is also crucial. Documentation that taxpayers may need to submit includes financial statements, receipts, contracts, opinion letters demonstrating reliance on expert guidance, among a wide range of other forms. Taxpayers should be prepared to address each disputed item at issue in their appeal, and having thorough documentation will generally help facilitate a faster resolution.

PAM is Not an Option for Taxpayers that Tried Fast-Track Mediation

Participating in Post-Appeals Mediation (PAM) is voluntary for both you and the IRS. Additionally, while PAM is generally an option following an unsuccessful appeal, there are exceptions. For example, PAM is not an option for taxpayers that have previously pursued the IRS’s fast-track settlement program, or fast-track mediation. If you need to continue pursuing reversal of an unfavorable IRS audit determination, our tax attorneys can evaluate your options and help you pursue a strategic path forward.

How the Federal Tax Attorneys at Oberheiden PC Can Help

If you need to consider Post-Appeals Mediation (PAM), there are several ways our federal tax attorneys can help. In this scenario, we can:

Fully Assess Your Options – Our attorneys can conduct an independent review of your options under the circumstances at hand—including (but not limited to) assessing the viability of Post-Appeals Mediation (PAM) and other mediation options. When you need to challenge the IRS’s determination of your personal liability (or your business’s liability), choosing the right path forward can make all the difference.

Help You Make an Informed and Strategic Decision – After reviewing your options, we can help you make an informed and strategic decision about how to proceed. We have extensive experience representing clients in complex cases, and we rely on our experience to provide strategic insights to our clients.

Address All Pertinent Federal Tax Issues – From income tax credits and deductions to the IRS’s trust fund recovery penalty, we have helped many taxpayers resolve an extremely wide range of federal tax issues with the IRS. In each client’s case, we take a custom-tailored approach focused on addressing all of the federal tax issues at hand.

Pursue Additional Means of Protection as Warranted – Along with handling post-appeal matters, we handle collection matters as well. For example, we also handle collection due process hearings involving the IRS and equivalent hearings involving other taxing authorities.

Provide Representation in Court or During the Collection Process if Necessary – Our attorneys also represent corporate and individual taxpayers in litigation in the US Tax Court and in federal district court proceedings across the country. We provide representation for taxpayers during the collection process as well. Regardless of your specific needs, we can develop and execute a defense strategy focused on mitigating your (or your business’s) liability to the fullest extent possible.

According to the IRS, successful appeals reduce taxpayers’ outstanding liability by about 40% on average—and about 90% of disputed cases are settled before trial. While every case is unique, pursuing a successful appeal can often result in significant tax savings for both individual and corporate taxpayers.

As a result, even when taxpayers are not successful during the initial appeals process, it will often be well worth continuing to pursue their appeals—and this often means pursuing Post-Appeals Mediation (PAM). Our attorneys can evaluate the strengths and weaknesses of the IRS’s position in your tax dispute, and then we can help you pursue a favorable resolution by the most efficient means available.

FAQs: IRS Post-Appeals Mediation (PAM)

How long do taxpayers have to request Post-Appeals Mediation (PAM) after an unsuccessful appeal?

While there is not a specific deadline for requesting Post-Appeals Mediation (PAM), taxpayers must be sure to preserve their ability to seek relief in federal court if necessary. With this in mind, if you are contemplating your next steps after an unsuccessful appeal, we strongly recommend consulting with an experienced tax attorney promptly.

Notably, while less than 10% of audited taxpayers pursue an appeal (taxpayers have 30 days to file an appeal after receiving a deficiency letter from the IRS), a significant percentage of IRS appeals are successful. Engaging experienced legal counsel can greatly improve your chances of success. This is true both during the initial appellate phase and in post-appeal mediation.

What information should I include in my formal written protest when pursuing Post-Appeals Mediation (PAM)?

A formal written protest is required for all disputes over $25,000. When submitting a formal written protest, taxpayers pursuing Post-Appeals Mediation (PAM) should work with their legal counsel to ensure that they are clearly and comprehensively addressing all of the issues that are pertinent to their appeal. The IRS assigns a new Appeals team for mediation to ensure impartiality, and the mediator (or mediators) facilitate discussions focused on facilitating an amicable settlement. As a result, the more information taxpayers can present—and the clearer they can present it—the better.

Does IRS Appeals have the authority to impose a settlement?

No. While IRS Appeals mediators can facilitate the parties’ discussions, they do not have the authority to impose a settlement. When taxpayers pursue Post-Appeals Mediation (PAM), the participants maintain full control over whether they ultimately settle through the PAM process.

Can I file for Post-Appeals Mediation (PAM) to challenge an IRS decision denying my request for innocent spouse relief?

No, while Post-Appeals Mediation (PAM) can be a cost-effective approach to resolving many types of tax disputes, it cannot be used to challenge an IRS decision denying a request for innocent spouse relief. The IRS describes this as a “whipsaw” issue (an issue “for which resolution with respect to one party might result in inconsistent treatment without the participation of the other party”), and these issues are not eligible for resolution through PAM.

How does Post-Appeals Mediation (PAM) differ from the IRS’s Collection Appeals Program (CAP)?

Post-Appeals Mediation (PAM) differs from the IRS’s Collection Appeals Program (CAP) in several respects. Most fundamentally, the PAM process focuses on determining taxpayers’ liability, while the CAP process focuses on the IRS’s efforts to collect amounts that are no longer in dispute (i.e., because a taxpayer missed the 30-day appeal deadline, resulting in a waiver of the taxpayer’s right to appeal).

If you are facing (or your business is facing) an IRS collection action, pursuing the CAP process is one possible option, but you may have other options as well. For example, taxpayers can also request a Collection Due Process (CDP) hearing within 30 days of receiving a relevant IRS notice; and, here too, taxpayers can go to federal court when necessary.

Speak with an IRS Post-Appeals Mediation (PAM) Lawyer in Confidence

If you would like to speak with one of our senior federal tax lawyers about pursuing Post-Appeals Mediation (PAM), we invite you to get in touch. Please call 888-680-1745 or contact us online to arrange a free and confidential consultation.

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