Internal Revenue Manual
IRM 8.4.1 — Procedures for Processing and Settling Docketed Cases
Part 8. Appeals
Chapter 4. Appeals Docketed Cases Section 1. Procedures for Processing and Settling Docketed Cases 8.4.1 Procedures for Processing and Settling Docketed Cases Manual Transmittal August 29, 2025 Purpose (1) This transmits revised IRM 8.4.1, Appeals Docketed Cases, Procedures for Processing and Settling Docketed Cases. Material Changes (1) Updated a reference in this IRM to the business operating division formerly known as Wage & Investment (W&I) to the division's new title: Taxpayer Services. See IRM 8.4.1.2 (6), Introduction to Docketed Cases. (2) Incorporated relevant sections of Appeals Interim Guidance Memorandum AP-08-0224-0003, Updated Procedures for Technical Employees Considering Docketed Cases, throughout this IRM. (3) Incorporated Appeals Interim Guidance Memorandum AP-08-1223-0013, New SharePoint site for ACDS Update request. See IRM 8.4.1.8 (5), Preliminary Review of Assigned Docketed Case. Also added a link to that section in IRM 8.4.1.20 (5), Reconsideration Cases (Closing Code 42) - Jurisdiction Returned to Appeals by Counsel, to allow readers to easily access this new procedure for submitting ACDS Update requests. (4) Added reference to IRM 25.30.2, Service Level Agreement between the IRS Independent Office of Appeals and the Taxpayer Advocate Service. See IRM 8.4.1.1.1 (5), Background. (5) Made editorial changes throughout this IRM for clarity. Reviewed and revised text to incorporate plain language and correct grammatical errors, as well as to update website addresses, references to legal authorities, position titles, and citations. Effect on Other Documents IRM 8.4.1, dated February 16, 2022, is superseded. This IRM incorporates Interim Guidance Memorandum AP-08-1223-0013, New SharePoint site for ACDS Update request, which is dated December 20, 2023. This IRM also incorporates the relevant portions of Interim Guidance Memorandum AP-08-0224-0003, Updated Procedures for Technical Employees Considering Docketed Cases, which is dated February 2, 2024. Audience IRS Independent Office of Appeals (Appeals) employees Effective Date (08-29-2025) Steven M. Martin Director, Operations Support
Program Scope and Objectives
8.4.1.1 (02-16-2022) Program Scope and Objectives Purpose: This IRM describes the processes used by the IRS Independent Office of Appeals (Appeals) to work docketed cases. Specifically, IRM 8.4.1: gives general information aimed at assisting Appeals Technical Employees (ATEs) who work docketed cases; provides procedures for new receipts and closures of docketed cases by ATEs; and recommends resources and authorities, including decision tools and other IRM sections, for considering docketed cases in Appeals. Audience: The primary users of this IRM section are ATEs. Policy Owner: Policy, Planning, Quality and Analysis is under the Director, Operations Support. Program Owner: Appeals Policy is the program office responsible for providing technical and procedural guidance to the Appeals organization, and is under the Director of Policy, Planning, Quality and Analysis. Contact Information: Appeals employees should follow established procedures on How to Contact an Analyst. Other employees should contact the Product Content Owner shown on the Product Catalog Information page for this IRM.
Background
8.4.1.1.1 (08-29-2025) Background This IRM provides guidance and information to assist ATEs in meeting the Appeals mission when working docketed cases. As stated in IRC 7803(e)(3), Purposes and Duties of Office, the Appeals mission is to resolve Federal tax controversies without litigation on a basis that is fair and impartial to both the Government and the taxpayer, promotes a consistent application and interpretation of, and voluntary compliance with, the Federal tax laws, and enhances public confidence in the integrity and efficiency of the Internal Revenue Service. Appeals accomplishes its mission by considering protested and Tax Court-docketed cases, holding conferences, and negotiating settlements in a manner which ensures Appeals employees are familiar with and follow the Taxpayer Bill of Rights (TBOR) in every interaction with taxpayers. The TBOR lists rights that already existed in the tax code, putting them in simple language and grouping them into 10 fundamental rights. Employees are responsible for being familiar with and acting in accord with taxpayer rights. See IRC 7803(a)(3), Execution of Duties in Accord with Taxpayer Rights. For additional information about the TBOR, see https://www.irs.gov/taxpayer-bill-of-rights. In accordance with IRM 25.30.2.3, Statement of Commitment, Appeals will work collaboratively with the Taxpayer Advocate Service (TAS) to enhance the taxpayer experience. For more information, see IRM 25.30.2, Service Level Agreement between the IRS Independent Office of Appeals and the Taxpayer Advocate Service.
Authority
8.4.1.1.2 (09-13-2019) Authority Rev. Proc. 2016-22, which supersedes Rev. Proc. 87-24, describes the Appeals process for cases docketed before the United States Tax Court.
Responsibilities
8.4.1.1.3 (09-13-2019) Responsibilities The Policy analyst shown on the Product Catalog page as the originator is the assigned author of this IRM.
Program Reports
8.4.1.1.4 (09-13-2019) Program Reports Policy, Planning, Quality and Analysis (PPQ&A) provides trend and data analyses and detailed summary reports for Appeals.
Terms and Acronyms
8.4.1.1.5 (09-13-2019) Terms and Acronyms See IRM Exhibit 8.1.1-1, Common Terms Used in Appeals, for common terms and definitions used in IRM Part 8. Terms listed in this exhibit are not included in this section. The following table lists commonly used acronyms and their definitions for relevant terms used in this IRM: Term Definition CCDM Chief Counsel Directives Manual TLCATS Tax Litigation Counsel Automated Tracking System
Related Resources
8.4.1.1.6 (09-13-2019) Related Resources This IRM is the primary source of guidance to Appeals on this program. The text of this IRM contains various references to assist employees who work docketed cases.
Introduction to Docketed Cases
8.4.1.2 (08-29-2025) Introduction to Docketed Cases As indicated, Rev. Proc. 2016-22 describes the general procedures for handling docketed cases. Appeals strives to resolve as many docketed cases as possible prior to trial. This section covers the processing and settlement of docketed cases from the time the ATE receives the case until the time the case is closed to the Appeals Team Manager (ATM). This section covers general procedures for docketed cases. More specific information may be found in IRM sections by type of docketed case. There are some unique procedures that apply solely to campus docketed cases that are covered in IRM 8.4.2, Campus Appeals Docketed Cases. References to Examination include the examiners in Taxpayer Services (TS), Small Business/Self-Employed (SB/SE), Large Business and International (LB&I), and Tax Exempt & Government Entities (TE/GE) groups. Refer to IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria, for criteria to determine when it is necessary to refer a case to TAS, and guidelines for processing TAS cases from assignment to completion.
Defining Docketed Cases
8.4.1.3 (09-13-2019) Defining Docketed Cases A docketed case is a tax case assigned a docket number in the U.S. Tax Court. These cases include, but are not limited to, petitions filed in response to: Notices of Deficiency; Final Adverse Determination Letters; Notices of Final Partnership Adjustment (FPA) or Notices of Final Partnership Administrative Adjustment (FPAA); Notices of Determination Concerning Relief From Joint and Several Liability Under Section 6015, as well as cases in which the IRS failed to send any Notice of Determination with respect to a request for spousal relief submitted to the IRS at least six months ago; Notices of Determination of Worker Classification; Notices of Certification of Seriously Delinquent Federal Tax Debt to the Department of State (also known as (a.k.a.) "Passport cases" ); and Notices of Determination Concerning Collection Action. A regular case is any docketed case that has not been identified as an "S" case. In eligible cases, taxpayers may elect to have their case conducted under the Court's simplified small tax case or "S" case procedures. Trials in "S" cases are conducted more informally, generally following less stringent procedural and evidentiary rules. An "S" case proceeding may result in a speedier disposition. However, a decision entered in an "S" case is not subject to review in any other court and cannot be treated as precedent for any other case. See IRC 7463 for details. In a deficiency case, taxpayers may elect "S" case procedures when the total amount of the deficiency and any additions to tax or penalties (not including interest) in dispute is not more than $50,000 for: Any one taxable year (income tax cases). The tax imposed (estate tax cases). Any one calendar year (gift tax cases). Any one taxable period (or, if there is no taxable period, taxable event) (excise tax cases). Note: The amount of deficiency in dispute includes additions to the tax, additional amounts and assessable penalties as outlined in IRC Chapter 68, to the extent the Tax Court has jurisdiction. Cases that do not deal with deficiencies in dispute, but which may be conducted under "S" case procedures include: Innocent spouse cases in which the "amount of spousal relief sought" does not exceed $50,000 for all years combined. The Tax Court holds that the "amount of spousal relief sought" includes accrued but unassessed penalties and interest. Collection Due Process cases in which the total unpaid tax (including interest and penalties) does not exceed $50,000 for all years combined. Worker classification cases in which the amount of employment taxes in dispute does not exceed $50,000 for any calendar quarter.
Designations Identifying Types of Docketed Cases
8.4.1.3.1 (09-13-2019) Designations Identifying Types of Docketed Cases The Tax Court uses the following identification terms or letters after the docket number to designate different types of docketed cases: Tax Court Designation Tax Court Description S Small or "S" cases D Disclosure Actions (IRC 6110) (with the prefix number next in order among all cases) L Collection Due Process Cases (IRC 6320 and IRC 6330) ABATEMENT Interest Abatement Actions (IRC 6404) X Exempt Organization Cases (IRC 7428) EMPLOYMENT Worker Classification Cases (IRC 7436) R Employee Plan Cases (IRC 7476) B Governmental Obligation Actions (Bonds) (IRC 7478) P Passport Cases (IRC 7345) W Whistleblower Actions (IRC 7623) The Tax Court website case listings under the "Docket Search" tab reflect the designated Tax Court docket number, along with the identification terms or letters. You can search cases on the Tax Court website by docket number. Counsel uses the Tax Litigation Counsel Automated Tracking System (TLCATS), a nationwide computerized case tracking system for docketed and nondocketed cases, which tracks the entire history of a case from opening through closing. TLCATS does not reflect the docket number identification terms or letters used by the Tax Court. Instead, TLCATS uses a separate letter coding system for docketed case type on TLCATS Case Screen 1. TLCATS uses the following letters after the docket number to identify different types of docketed cases: Counsel TLCATS Designation - Tax Court Cases Counsel TLCATS Description AI Abatement of Interest DU Due Process Collection W Whistleblower Counsel TLCATS Designation - Declaratory Judgment for Tax Court Cases Counsel TLCATS Description B Bond Tax Status D Disclosure Information R Retirement Plans T Transfer of Property Out of U.S. X Exempt Organization
Jurisdiction of the Tax Court
8.4.1.4 (09-13-2019) Jurisdiction of the Tax Court The U.S. Tax Court is a federal court of record established by Congress under Article I of the Constitution of the United States. Congress created the Tax Court to provide a judicial forum in which affected persons could dispute tax deficiencies determined by the Commissioner of Internal Revenue (IRS Commissioner) prior to payment of the disputed amounts. The jurisdiction of the Tax Court includes the authority to hear a variety of tax disputes. The Tax Court has jurisdiction to redetermine whether deficiencies determined by the IRS Commissioner in notices of deficiency are correct. The Tax Court also has jurisdiction over other proceedings where Congress has given specific grants of jurisdiction. In all cases, the jurisdiction of the Court also depends on the timely filing of a petition by the taxpayer. The following list describes various types of docketed cases over which the Tax Court has jurisdiction: Type of Case Description Deficiency Proceedings The Tax Court has jurisdiction to redetermine the deficiency determined by the Service. IRC sections 6211 through 6216 and IRM 8.7 cover many deficiency procedures. In a deficiency proceeding, the Court maintains jurisdiction only where the IRS Commissioner has issued a notice of deficiency and the taxpayer has filed a timely petition; or in a transferee or fiduciary proceeding, the Court maintains jurisdiction only where the IRS Commissioner has issued a notice of liability to the transferee or fiduciary and the transferee or fiduciary has filed a timely petition. Declaratory Judgment The Tax Court has jurisdiction over certain types of declaratory judgments. See CCDM 35.1.1.20, Declaratory Judgment and Other Proceedings, and the sections that follow for additional information on the following: Declaratory judgment relating to oversheltered return (IRC 6234(c)) Declaratory judgment relating to qualification of certain exempt organizations (IRC 7428) Declaratory judgment relating to worker classification (IRC 7436) Declaratory judgment relating to qualification of retirement plan (IRC 7476) Declaratory judgment relating to gift valuation (IRC 7477) Declaratory judgment relating to government obligations (IRC 7478) Declaratory judgment relating to eligibility of an estate to make installment payments under IRC 6166 (IRC 7479) Disclosure Actions The Tax Court has jurisdiction over the review of disclosure actions (IRC 6110(f)(3) and IRM 11.3, Disclosure of Official Information). Administrative and litigation costs The Tax Court has jurisdiction over actions for administrative costs (IRC 7430(f)(2) and IRM 8.7.15, Administrative Cost and Qualified Offer Cases). Readjustment and adjustment of partnership items The Tax Court has jurisdiction over the readjustment and adjustment of partnership items, including: Review of final partnership administrative adjustments (former IRC 6226) Review where an administrative adjustment request is not allowed in full (former IRC 6228) Review of partnership adjustments of a large partnership (former IRC 6247) Review where an administrative adjustment request is not allowed in full for a large partnership (former IRC 6252). Review of a partnership adjustment The Tax Court has jurisdiction over a petition for readjustment of a partnership-related item when an FPA has been issued (IRC 6234). Interest Abatement The Tax Court has jurisdiction over the review of the Service's denial of a request to abate interest, or "Interest abatement claims" (IRC 6404(h) and IRM 20.2.7, Abatement and Suspension of Debit Interest). Collection Due Process The Tax Court has jurisdiction over the review of certain lien/levy actions, or "collection due process (CDP)" cases (IRC 6320; IRC 6330; and IRM 8.22, Collection Due Process). Innocent Spouse The Tax Court has jurisdiction over the review of relief from joint and several liability on a joint return, or "innocent spouse cases" (IRC 6015(e) and IRM 8.7.12.9.3, Docketed Innocent Spouse Cases). Worker classification The Tax Court has jurisdiction over the review of worker classification (IRC 7436). Jeopardy Assessment The Tax Court has jurisdiction to review the reasonableness and appropriateness of a jeopardy assessment where a taxpayer has already timely petitioned the Tax Court to redetermine a deficiency at the time the jeopardy assessment is made (IRC 7429(b)(2)(B); IRM 4.15.1.10.4.2, Judicial Reviews; and IRM 8.7.1, Guidelines for Cases with Special Issues). Review of sale of seized property The Tax Court has jurisdiction to review the Service's determination to sell seized property pending a decision by the Tax Court in a deficiency proceeding (IRC 6863(b)(3)(C)). Redetermination of interest The Tax Court has jurisdiction over the redetermination of interest on deficiencies or overpayments determined by the Tax Court (IRC 7481(c)). Enforcement of overpayment decision The Tax Court has jurisdiction over enforcement of an overpayment decision by the Tax Court if not refunded by the Service within 120 days after the decision of the court has become final (IRC 6512(b)(2)). Section 6166 Interest Modification The Tax Court has jurisdiction to modify the final decision in an estate tax case to reflect interest paid pursuant to IRC 6166 (IRC 7481(d)). Review of Certification of Seriously Delinquent Tax Debt to U.S. State Department The Tax Court has jurisdiction to determine whether the Service's certification of a seriously delinquent federal tax debt was erroneous, or whether the Service has failed to reverse the certification (IRC 7345). Note: These so-called "Passport Cases" will not be referred to Appeals by Counsel. See Chief Counsel Notice CC-2018-005. Whistleblower Actions The Tax Court has jurisdiction to review the Service's determination of whistleblower awards (IRC 7623). Note: For more information, see CCDM 35.1.1, Tax Court Jurisdiction and Proceedings. Questions concerning Tax Court jurisdiction should be directed through the Field Counsel assigned to the case to Associate Chief Counsel, Procedure and Administration.
No-Deficiency and Overassessment Years in Docketed Case Work Units
8.4.1.4.1 (08-09-2011) No-Deficiency and Overassessment Years in Docketed Case Work Units No-deficiency and overassessment years are not subject to the Tax Court's jurisdiction. Appeals may consider a work unit containing both docketed and nondocketed years.
Appeals' Authority Over Docketed Cases
8.4.1.5 (09-13-2019) Appeals' Authority Over Docketed Cases When Counsel refers a docketed case to Appeals for consideration, Appeals has exclusive authority to settle the case. This authority remains with Appeals unless procedures require the case be returned to Counsel. Counsel may choose not to refer certain cases or issues to Appeals. See Rev. Proc. 2016-22, Section 3.03. If Counsel determines that a referral to Appeals will not be made on a case or issue, Counsel will notify the petitioner that a referral to Appeals will not be made. In such a situation, Appeals foregoes settlement authority on the case or issue not referred by Counsel.
Common Terms and Definitions in Docketed Cases
8.4.1.6 (02-16-2022) Common Terms and Definitions in Docketed Cases Some Tax Court terms and definitions are provided in CCDM 35.1.2, Tax Court Terms and Definitions. In addition, common definitions for docketed cases include: Term Definition Acquiescence IRS Commissioner's acceptance of a decision reached by the trial court adverse to the position of the government. These are published in the Internal Revenue Bulletin. Action on Decision Chief Counsel's recommendation, if any, of action to be taken on an adverse decision. Cases on Remand When a case is sent back to a lower court with orders about further action. Decision of the Tax Court In a deficiency case, the decision of the Tax Court memorializes the Tax Court's determination of the correct amount of the deficiency, penalty, additions to tax or overpayment. A decision needs to dispose of any claims for award of attorney's fees under IRC 7430. The time to appeal a decision of the Tax Court is within 90 days after the decision is entered. A decision document closes a case. A decision is signed by a judge and entered in the Court's record. The decision reflects the conclusions of the Court. A decision can be entered in a case after the parties have settled all issues or the judge has issued an opinion or order deciding all issues in a case. Defaulted Case A case where a party fails to plead or otherwise proceed with the case as provided by the Tax Court Rules of Practice and Procedure and the Tax Court enters a decision against the defaulting party. A decision rendered upon a default operates as an adjudication on the merits. Dismissed Case A case where the Tax Court has entered an order of dismissal for lack of prosecution, lack of jurisdiction or other reason. A decision rendered in consequence of a dismissal, other than a dismissal for lack of jurisdiction, operates as an adjudication on the merits. Legal File A file maintained by Counsel containing all legal documents pertaining to a docketed case. Nonacquiescence IRS Commissioner's non-acceptance of a decision reached by the Tax Court that is adverse to the position of the government. These are published in the Internal Revenue Bulletin. Original Consideration Appeals' consideration of a docketed case not considered by Appeals in nondocketed status. Petition Taxpayer's request to the Tax Court for a redetermination of the deficiency. This is the pleading the taxpayer files with the Tax Court to initiate an action. A petition in a declaratory judgment proceeding is the pleading filed by the taxpayer or fiduciary. Petitioner A taxpayer or fiduciary who files a petition with the Tax Court. Proposed Schedule of Trial Sessions Schedule prepared by the Tax Court for each trial term. This schedule is used primarily by the Tax Court to arrange courtroom facilities. Reconsideration An Appeals consideration of a docketed case previously considered by Appeals in either nondocketed or docketed status. Respondent In a Tax Court case, the respondent is the IRS Commissioner. Rule 155 Case After trial, the Tax Court renders an opinion. If the opinion requires a recomputation of tax, the Court withholds entry of its decision to permit a computation as provided by Tax Court Rule 155. An Appeals Tax Computation Specialist (TCS) generally does the recomputation. Session Settlement Settlement effected by Counsel after the date a docketed case is set for trial or the opening date of the Pre-trial Hearing or Request Session. Settlement Stipulation Settlement document filed with the Tax Court. This document memorializes the settlement of: a deficiency, a penalty, an addition to tax, an overpayment, or some other issue agreed to by the government and petitioner in a docketed case. Claims for attorney's fees under IRC 7430 may also be included. Stipulation of Facts A formal legal document filed with the Tax Court setting forth those mutually agreed statements of fact which require no proof in Court. Trial Calendar The Tax Court's list of cases scheduled for trial at a certain time and place. The trial calendar is issued several months before the opening date of the trial session. Trial Calendar Period The period beginning with the issuance of the calendar and ending on the opening day of the session. Trial Terms The three time periods into which the Tax Court divides the fiscal year for trial sessions of the court. The three terms are: Fall Term - 12 weeks beginning in September, Winter Term - 9 weeks beginning in January, and Spring Term - 9 weeks beginning in April. Trial Session Actual time the Tax Court sits and hears cases during a term.
Docketed Case For Assignment and Consideration After Answer Filed
8.4.1.7 (09-13-2019) Docketed Case For Assignment and Consideration After Answer Filed After filing an answer with the Tax Court, Counsel sends the administrative file (or dummy file) for consideration directly to the Appeals office and ATM identified in the Orange Cover Sheet previously placed on top of the administrative file by Account and Processing Support (APS). Counsel generally puts a copy of the Designation of Place of Trial and answer in the administrative file for the ATE to use. But Counsel no longer places a copy of the petition in the administrative file. Instead, the petition will generally be uploaded into the Appeals Centralized Database System (ACDS) on the relevant Case Activity Records page as a case file attachment. Upon receipt of the file from Counsel after answer, the case will be assigned to an ATE on ACDS. Note: Upon assignment, the "FROMDATE" field on the case inventory screen is systemically completed with the assignment date. If APS receives an administrative file before the system completes the "FROMDATE" field, DO NOT manually enter a "FROMDATE" . Manually inputting a "FROMDATE" before the case is assigned removes the case from the "ANSWER" follow up report and leaves APS with no way to monitor the statute. When the ATM and/or ATE receives the administrative file, they must identify any processing instructions or issues raised by Counsel, as well as conduct their own independent review, for actions needed on issues including: non-petitioning spouses, non-petitioned years, and premature assessments. If any of these issues are identified, the ATM or ATE must alert APS immediately of any corrections needed. Caution: Counsel may note actions needed on a Form 1734, Transmittal Memorandum, or elsewhere in the administrative file. But the ATM and ATE should also review the file themselves to determine any preliminary issues that need to be addressed. The ATM and ATE should then take prompt action to address such preliminary issues. Reminder: Docketed key cases that are subject to the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) must be screened by the Appeals TEFRA Team. Upon receipt of such a case, the ATM and/or ATE must verify that this review by the Appeals TEFRA Team has been completed. For more information about this requirement, and for actions to take in the event that this screening was not completed before the ATM received the case, see IRM 8.19.1.1.1(2), Appeals TEFRA Team (ATT).
Preliminary Review of Assigned Docketed Case
8.4.1.8 (08-29-2025) Preliminary Review of Assigned Docketed Case When an ATE receives a newly assigned docketed case, they complete the intake procedures fully described in IRM 8.2.1.4, Receipt of New Assignment by an Appeals Technical Employee (ATE), generally within 45 days of receiving the case. To summarize IRM 8.2.1.4(1), the ATE's intake actions must include: Completing the statute verification (including verifying the timeliness of the petition), Validating all critical data fields in ACDS, Determining whether the case is ready for Appeals' consideration, and Making initial contact with the taxpayer or representative. Reminder: IRM 8.2.1.4(1) generally establishes a 45-day deadline for ATEs to complete these intake procedures. While the ATM is authorized to be "reasonable" in extending this 45-day deadline for contacting taxpayers, the ATM is not authorized to extend the 45-day deadline for the ATE to complete the process of statute verification. See IRM 8.2.1.4.1, Exception to 45-Day Time Frame for Initial Case Actions. Note: In conducting the preliminary review of an assigned docketed case, the ATE may find a Form 14121, No Change Certification, in the administrative file. These forms are generally prepared when a taxpayer sends supporting documentation to the originating function in response to the statutory notice of deficiency. At times, the originating function accepts the information and "no changes" the case. In those cases, the originating function prepares Form 14121 to certify that it has reviewed the documentation provided by the taxpayer and concluded that no changes are needed to the return as filed. While the Form 14121 will generally resolve the dispute, the ATE must remember that a decision document (and perhaps a Statement of Account) is still needed to officially resolve the Tax Court case. After a petition is filed with the Tax Court, a transaction code (TC) 520 with action code 72 should post to the petitioner's account to indicate that the taxpayer is involved in litigation before the Tax Court. The ATE will check for the presence of this TC 520 when the case is initially received. If it is not present, the ATE will contact APS to have it posted. All returns, Compliance documents, and Counsel documents (including a copy of the petition, answer, and designation of place of trial) should be available to the ATE, either in the administrative file or as case-file attachments in ACDS, and properly arranged. When the ATE receives a dummy file for consideration, the paper file and the ACDS Case Activity Record (CAR) should collectively contain all available return and Compliance information, as well as the petition, answer, and designation of place of trial from Counsel. Note: If essential documents are missing from the dummy file, it may be necessary to request copies of documents from the taxpayer. The ATE should consult with the ATM to determine the appropriate action to take in such cases. If the ATE determines that critical data fields in ACDS are incorrect, they must either: (i) input and promptly submit any necessary updates or corrections using the validation tracking system (VTS) in ACDS, or (ii) prepare and promptly submit an "ACDS Update Request Form" to APS if the data field that needs correction is not available for update via the VTS. If an ACDS Update Request Form is needed for an update or correction, the ATE will use the following procedures to request assistance from APS: Prepare the ACDS Update Request Form, completing the required fields as appropriate. This form can be found on either the Appeals Generator of Letters and Forms (APGolf) or APGolf 2.0 under the "ACDS Updates" category. Note: APS will return requests that can be completed by the ATEs. If an ACDS Update Request must be used, then ATEs should use the most recent ACDS Update Form from APGolf or APGolf 2.0. Access the Appeals Shared Programs Hub - Home and scroll down to the heading APS – Case Update Requests (Appeals Only). Beneath that heading, click on the button labeled Add New APS - Case Update Requests and complete and submit the electronic intake form, including attaching the ACDS Update Request Form. The website will notify ATEs that their requests have been assigned, completed, and/or rejected. The website also allows ATEs to monitor and follow up on their open requests. Caution: Do not email the ACDS Update Request Form directly to an APS employee, such as a processing team manager (PTM). APS will process the ACDS Update Request Form within three business days of receipt. APS will email the requesting employee if clarification is needed to process the request. APS will return any requests for updates or corrections that are not submitted via the Appeals Shared Programs Hub - Home. This website allows APS management to monitor timeliness and accuracy of the updates. If the ATE assigned to a docketed case requires the administrative case file for a related case that has not been transmitted with the administrative file for the docketed case, the ATE will: Research the Integrated Data Retrieval System (IDRS) and any other available databases (e.g., ACDS, Issue Management System, Correspondence Examination Automation Support, etc.) to determine the location of the related case. Prepare and submit an electronic Case Update Request to establish an ACDS record for the related case and feature code PL. For reference returns, the Docket Number of the Tax Court case should be entered followed by an N (e.g., Tax Court Docket No. XXXX-24N). If the case is closed on IDRS, submit a request to the Shared Team of Administrative & Redaction Support (STARS) to order the Document Locator Number (DLN) from Files. If the paper file is received, the ATE will remove feature code PL from ACDS. Frequent and accurate communications between the ATE and the assigned docket attorney or paralegal in Counsel are essential when working docketed cases. To encourage those communications, an ATE assigned a docketed case will send a brief encrypted email message to the relevant docket attorney or paralegal after receiving the case to advise of their assignment to the case. If the ATE is unsure of the assigned attorney or paralegal in Counsel's office for any particular case, they will first check to see who signed the answer uploaded in ACDS. If the answer has not been uploaded in ACDS, the ATE will enter the docket number in the DAWSON system on the Tax Court's website, choose Printable Docket Record, and then search for the field titled Respondent Counsel Contact. If, and only if, the ATE cannot determine the assigned Counsel attorney from either of those two methods, the ATE will contact *Team TL for assistance.
Preliminary Review for Timely Filing
8.4.1.8.1 (09-13-2019) Preliminary Review for Timely Filing When the petition appears to be untimely, the ATE should immediately contact the Field Counsel attorney assigned the case to discuss the possibility of Counsel filing a motion to dismiss. The original administrative file should be obtained and reviewed prior to filing a motion to dismiss. A dismissal for lack of jurisdiction may be based on circumstances which favor the taxpayer. For example, a deficiency notice may be determined to be invalid because it was not sent to the taxpayer's last known address. Reminder: In reviewing cases with a non-petitioning spouse, the ATE should always be aware of the possibility that the non-petitioning spouse's notice of deficiency was not sent to his/her last known address. Questions about whether a taxpayer was notified at his/her last known address should be discussed with the ATE's ATM and the assigned Field Counsel attorney.
Preparing For and Holding the Conference
8.4.1.9 (10-01-2012) Preparing For and Holding the Conference Follow procedures found in IRM 8.6.1, Conference and Issue Resolution, IRM 8.6.2, Appeals Case Memo Procedures, and IRM 8.6.3, Appeals Rulings, for information to help in preparing for and holding the conference with the taxpayer.
Counsel (or Attorney) of Record in Docketed Cases
8.4.1.9.1 (02-16-2022) Counsel (or Attorney) of Record in Docketed Cases In docketed Tax Court cases, suits for refund, and bankruptcy cases that are judicial tax proceedings, no power of attorney (POA) is required from a counsel of record (a.k.a. an attorney of record (AOR)). An attorney becomes the petitioner's counsel of record by filing a petition or refund suit, or by entering an appearance in the case. A counsel of record is authorized to act on behalf of the petitioner in the court proceedings, access the tax information of the person they represent, and represent the taxpayer before the IRS. In a case docketed in the Tax Court, anyone other than the counsel of record must be eligible to practice before the IRS and, in order to be recognized, must present a Form 2848, Power of Attorney and Declaration of Representative, or other POA plus a declaration. Note: An ATE can determine if a petitioner currently has a counsel of record by reviewing the docket listing found on the Tax Court's website. The ATE accesses the Tax Court's DAWSON website, enters the relevant docket number in the Search by Docket Number field, chooses Search, clicks on Printable Docket Record, and looks for a name in the Counsel column for the row corresponding with each petitioner's name. See the following table for additional information on an AOR: Scope of Practice Before IRS Source of Eligibility to Practice Required Evidence of Authority Any IRS office 26 C.F.R. Section 601.509. See also Publication 216, Conference and Practice Requirements. POA not required When a taxpayer is represented by a counsel of record, the ATE should communicate exclusively with the counsel of record. See IRM 8.6.1.4.4(5), Copies of Written Communications. See also 26 C.F.R. Section 601.509.
Request for Legal Advice
8.4.1.9.2 (09-13-2019) Request for Legal Advice Appeals cannot request a Technical Advice Memorandum (TAM) or a Technical Expedited Advice Memorandum (TEAM) on any issue if the same issue is involved in a docketed case for any taxpayer for any taxable year. Instead, Appeals requests legal advice from Field Counsel. TAMs and TEAMs are advice published by the Office of Associate Chief Counsel concerning the interpretation and proper application of the tax law, tax treaties, regulations, revenue rulings, notices or other precedents to a set of specific facts involving a specific taxpayer. When requesting legal advice in a docketed case, send one information copy of the request for legal advice to the Field Counsel attorney/paralegal assigned to the docketed case and his/her supervisor. The request must clearly indicate that it involves a docketed case. In docketed cases, do not advise the taxpayer (petitioner) that legal advice was requested. See IRM 8.6.3, Appeals Rulings, for detailed information on requesting advice.
New Issues in Docketed Cases
8.4.1.9.3 (09-13-2019) New Issues in Docketed Cases A new issue in a docketed case is any adjustment to or change to an item that affects the petitioner's tax liability that was not included in the notice of deficiency and is raised or discussed during consideration of the case. Appeals will not raise a new issue in a docketed case. However, Appeals will consider new issues the government raises in its pleadings, and may consider any new evidence developed by Compliance or Counsel to support the government's position. Note: The government has the burden of proof on new issues the government raises in its pleadings. Whenever a petitioner raises an issue not previously examined or raised in the petition, the assigned ATE must prepare a brief memorandum to the assigned Field Counsel attorney. Submit the completed memorandum to the ATM to be forwarded to Counsel. The memorandum must: Describe the new issue, Assess whether Appeals believes the issue is amenable to settlement, State whether additional factual development is necessary, and Discuss any other observations and recommendations Appeals may have concerning the new issue. Advise the petitioner that no settlement discussion will take place with respect to the new issue until the assigned Field Counsel attorney determines whether a formal amendment of the pleadings is needed to raise the new issue pursuant to Tax Court Rule 41(a). Note: Chief Counsel favors formal amendments to the pleadings unless a substantial reason exists for permitting Appeals to consider a new issue raised by the petitioner without a formal amendment to the pleadings. When the new issue involves a Coordinated Industry Case (CIC), a Compliance Coordinated Issue (CCI), an Appeals Coordinated Issue (ACI), large dollar amounts, or is otherwise significant, the assigned Field Counsel attorney generally will ask the petitioner to formally amend the pleadings before Appeals considers the new issue. Within 10 business days of receipt of the memorandum from Appeals, the assigned Field Counsel attorney will notify Appeals in writing as to whether Appeals may consider the new issue raised by the petitioner in the absence of a formal amendment to the pleadings. Note: When the assigned Field Counsel attorney determines that Appeals may consider a new issue without a formal amendment to the pleadings, or when the petitioner raises a new issue in a formal amendment to the pleadings filed with the court, the ATE will retain jurisdiction and refer the new issue to Compliance for review and to make an initial determination. See IRM 8.4.4, Examination Assistance Requests, for more information about referring docketed cases to the Compliance function. Where the taxpayer (or representative) offers to make payment of additional tax liability for slush fund or improper payment deductions, or reveals their existence to Appeals for the first time, the ATE will discontinue Appeals' consideration of the case and immediately contact the assigned Field Counsel attorney.
Assistance to Counsel/Appeals
8.4.1.9.4 (09-13-2019) Assistance to Counsel/Appeals There are a number of circumstances where Counsel and Appeals may request and provide assistance to each other in the working of docketed cases. Appeals may request the assistance of Counsel in docketed cases in the same manner as prescribed in IRM 8.2.1.7.1, Assistance from Counsel in Pre-90-Day Cases. Counsel may request assistance from Appeals during trial preparation of cases in which Appeals developed knowledge and expertise that is beneficial to Counsel. If resources and workloads permit, Appeals assists Counsel as an advisor and, if appropriate, shares in some part of trial preparation.
"Last Chance" Letter Assistance from Counsel
8.4.1.10 (09-13-2019) "Last Chance" Letter Assistance from Counsel The "Last Chance" Letter is designed to encourage unresponsive petitioners to initiate settlement with Appeals as early as possible. When requested by Appeals, the assigned Field Counsel attorney or paralegal in SB/SE Field Counsel or TEGE Division Counsel (TEGEDC) will issue a "Last Chance" Letter strongly encouraging petitioners to participate in the resolution of their docketed cases or prepare to go to trial. When to use: Ask Counsel to send the "Last Chance" Letter to petitioners who have not meaningfully responded to contacts to initiate settlement negotiations. Include "no-response" situations. Ask Counsel to send the letter any time it may help to get the petitioner to cooperate with Appeals. The steps to request that Counsel issue a "Last Chance" Letter are: Ask Counsel to prepare and issue the letter by sending an encrypted email to the assigned Field Counsel attorney/paralegal, as well as a carbon copy to the assigned Field Counsel employee's supervisor. Note: The ATE can generally determine the assigned Field Counsel paralegal/attorney by checking the "Attorney" field on the Case Summary Card, or by performing a Docket Search on the Tax Court's website (i.e., clicking on the Printable Docket Record button and reviewing the people listed as "Respondent Counsel"). The ATE can then use Outlook to determine the Field Counsel attorney's supervisor. Include the name of the petitioner and the docket number in your request. Counsel prepares and issues the "Last Chance" Letter to the petitioner within 2 business days of receiving the ATE's request. The letter instructs the petitioner to respond to the ATE by a certain date or within a certain number of days from the date of the letter. Note: There is no standard "Last Chance" Letter format, so each Field Counsel attorney/paralegal will prepare the letter in accordance with local procedures. Once issued, Counsel attaches a copy of the dated letter to an encrypted email and sends it to the requesting ATE. Note the email request and Counsel response in the ACDS Case Activity Record and Automated Timekeeping System (CARATS) for the case and hold the case for the period indicated. Use the following if-then table to determine how to proceed on the case: If... Then... The petitioner responds to the "Last Chance" Letter by the deadline given The ATE initiates settlement negotiations The petitioner does not respond to the "Last Chance" Letter by the deadline given The ATE attempts at least one more contact by telephone using updated information. If petitioner responds, initiate settlement negotiations. If petitioner doesn't respond, process case in accordance with existing trial-preparation procedures. Note: Continue all required notifications and requests to petitioners to participate in the Appeals process as currently defined in the "S" case or existing local contact procedures. Note: This process will not reduce the timeframe commitment for providing cases to Counsel by the applicable deadline given in section 3 of Rev. Proc. 2016-22.
Settlement of Docketed Cases
8.4.1.11 (08-29-2025) Settlement of Docketed Cases The settlement approach and elements of evaluating issues are not affected by whether a case is nondocketed or docketed. An unacceptable settlement in nondocketed status does not become acceptable solely because it is reconsidered in docketed status; nor does an unacceptable settlement become more acceptable when a case is calendared for trial than prior to being calendared for trial. This approach, of course, does not preclude recognition of changes in judicial interpretation of the law and changes in Service position. It is also recognized that in reconsideration of a case, or in trial preparation, additional facts may arise which can affect evaluation of the case. See IRM 8.6.4, Reaching Settlement and Securing an Appeals Agreement Form, for additional guidance on settling cases. Before making a settlement offer on a docketed case, the ATE must check the Tax Court's docket-management system, DAWSON, to ensure that the case has not been dismissed or otherwise disposed. A docketed case is not considered settled until the ATE receives verbal or written confirmation from the petitioner or AOR that they agree to the settlement terms and will sign a decision document (or will have received authority from the petitioner to sign a decision document) to resolve the case. Reminder: No agreement is reached if the petitioner or AOR does not respond to the settlement offer or expresses indecision about it (e.g., "I need to think about it."). If a settlement is reached on a docketed case, the ATE will document the details of the settlement discussion in the corresponding CAR in ACDS. As part of the details included in the CAR entry, and to eliminate confusion, the ATE must include the words "settlement reached; petitioner or AOR agrees to sign decision documents." If a docketed case is settled, the ATE will ask the petitioner or AOR if they will accept electronic delivery of settlement computations and decision documents. As part of that discussion, the ATE will discuss available IRS-approved options for transmitting documents electronically. The ATE will document the corresponding CAR with the method used to contact the petitioner or AOR, as well as the details of the discussion and their responses regarding electronic delivery of settlement computations and decision documents. Once a docketed case is settled, the ATE will order settlement computations (if necessary). See IRM 8.4.1.12, Settlement Computations on Docketed Cases. After receipt from the TCS, the ATE will review and approve the settlement computations. The ATE will also ensure that the settlement computations have been uploaded in ACDS. Using IRM 8.4.1.11.2 (for field ATEs) or IRM 8.4.2.7.1 (for campus ATEs), the ATE will determine if Appeals or Counsel is responsible for preparing the decision document. If Counsel is responsible for drafting the decision document, the ATE will contact Counsel for assistance through the Chief Counsel Portal unless the ATE and Counsel attorney or paralegal have previously agreed differently. In any case, the ATE will provide the assigned Counsel employee with any information necessary to prepare the decision document. After the decision document is prepared, the assigned Counsel employee will provide it to the ATE. The ATE will then either ensure that the decision document was uploaded in ACDS by Counsel or will upload the decision document in ACDS themselves. The ATE will then proceed to IRM 8.4.1.16(3), Closing Docketed Cases, to determine the proper method to be used for closing the case. If Appeals is responsible for drafting the decision document for the case, the ATE will consult the Appeals Decision Document Guidebook (as necessary) and will use the ACDS decision document macro to prepare the decision document and upload it to ACDS. SeeIRM 8.4.1.11.2 (2), Stipulation/Decision Preparation. The ATE will then proceed to IRM 8.4.1.16(3), Closing Docketed Cases, to determine the proper method to be used for closing the case. Note: The Appeals Decision Document Guidebook is located on the Appeals Docketed Cases website under the Resources (A-Z) heading.
Settlement of Related Cases
8.4.1.11.1 (09-13-2019) Settlement of Related Cases No settlement offer will be accepted by Appeals where there is a related case in Counsel unless both offices agree that the offer is acceptable. Disagreements between Appeals and Counsel on whether a settlement offer should be accepted are resolved by the Counsel office to which the responsible Field Counsel attorney is assigned, with the advice and assistance of the ATE's Appeals Area Director and the Associate Chief Counsel responsible for the issue. Counsel should review Appeals-proposed statutory notices of deficiency, claim disallowances, and final adverse letters for any case related to a docketed case before such notices or letters are issued to the taxpayer.
Stipulation/Decision Preparation
8.4.1.11.2 (08-29-2025) Stipulation/Decision Preparation In most docketed cases settled by Appeals, an Appeals employee prepares the necessary settlement documents and has these documents executed by the taxpayer or counsel of record. Appeals will prepare simple settlement documents. For these decision documents, ATEs will use the decision document macro contained in APGolf in ACDS. Once generated by ACDS, the ATE will review the decision document to ensure it is accurate and properly formatted. Typically, the following simple stipulation decision documents are prepared by Appeals: Deficiency in Income Tax (Simple Stipulation Decision) Deficiency in Income Tax with Penalties and/or additions to tax No Deficiency and No Overpayment Multiple petitioners Simple Innocent Spouse cases Note: In all cases where Appeals prepares a decision document for the petitioner's or counsel of record's signature, Appeals must review source documents, such as the petition and any orders in the file, regarding the caption. In addition, Appeals must access www.ustaxcourt.gov to ensure the proper caption is used. If there is a discrepancy between the caption shown on source documents and the caption shown on the official Tax Court website, Appeals contacts Counsel to determine the correct caption to use. The ATE will prepare the signature block for the appropriate Counsel attorney by copying information from the signature block contained on the answer uploaded to ACDS unless the ATE has been advised by Counsel that the case has been reassigned. If the case was reassigned, the Counsel attorney should have provided the ATE with notice of the change, along with the attorney's signature block by email. In complicated settlements, Appeals will ask Counsel to prepare the settlement documents. Complicated situations generally include, but are not limited to, the following: Prepayment Credits, Restricted Interest, Tentative Carryback Allowance, Jeopardy Assessments, Prior Unpaid Assessments, Excessive Claimed Withholding Tax, Estimated Tax Payments, Overpayment cases, Transferee or Fiduciary Liability, Worker-classification cases, IRC 5000A Shared Responsibility Payment issues, Complex Innocent Spouse cases, and Section 531 cases. For cases where Field Counsel is responsible for preparing the decision documents, Field Counsel will: Prepare the settlement documents, and Return the settlement documents to Field Appeals to secure signature from the taxpayer. See IRM 8.4.2.7.1, Stipulation/Decision Preparation, for guidance on Field Counsel preparation and mailing of decision documents for Campus Appeals. Note: APS uses the ACDS action code PREPSTIP to reflect these cases. During an in-person conference, the ATE will prepare settlement documents and seek the necessary signatures, if possible. If not, or when the conference is conducted by any other method, the ATE will mail settlement documents to the petitioner or counsel of record as soon as possible after the conference. Where unusual or complex circumstances exist, proposed settlements of regular docketed cases are reviewed by the ATM before the settlement documents are forwarded to the petitioner for signing. To assist Appeals with drafting decision documents for which Appeals is responsible, Counsel has prepared the Appeals Decision Document Guidebook. This comprehensive guidebook offers useful information and guidance about preparing decision documents in Appeals, including relevant formatting requirements. ATEs will review this guidebook and consult it whenever they have questions with respect to drafting, preparing, and formatting decision documents. Note: The Appeals Decision Document Guidebook is located on the Appeals Docketed Cases website under the Resources (A-Z) heading. Counsel reviews the format and accuracy of all settlement documents prepared by Appeals before filing with the Court.
Settlement Computations on Docketed Cases
8.4.1.12 (09-13-2019) Settlement Computations on Docketed Cases Appeals is responsible for preparing the necessary computations for docketed cases settled either by Appeals or by Counsel. These computations are to be prepared by a TCS. When the ATE reaches settlement with a petitioner or counsel of record and determines that settlement computations are needed, they will use the APGolf subsystem in ACDS to electronically prepare and submit Form 3608, Request for TCS Service, to request assignment to a TCS. When the docketed case is settled as an agreed case, the TCS will follow the normal procedures for preparing settlement computations found in IRM 8.17.2, General Settlement and Rule 155 Computations.
Tentative Allowances in Docketed Cases
8.4.1.12.1 (09-13-2019) Tentative Allowances in Docketed Cases Taxpayers may report a net operating loss or credit carryback loss as a tentative allowance on Form 1045, Application for Tentative Refund, for individuals, or Form 1139, Corporation Application for Tentative Refund. This is called a tentative allowance or tentative carryback. A tentative allowance is identified on an account module with TC 295. When this TC is present, either a Form 1045 (individuals) or a Form 1139 (corporations) was filed. Compliance usually secures Form 1045/Form 1139 and places it in the case file along with the return. If the form is not in the case file, the ATE should take steps to secure a copy so an analysis can be made to determine what year the carryback originated and the amount of the carryback allowed. Further discussion of tentative allowances (Form 1045/Form 1139) is found at IRM 8.17.4.14, Tentative Allowances and Other Carryback Claims in Notice of Deficiency Statement.
Other Carryback Claims Allowed in Docketed Cases
8.4.1.12.2 (09-13-2019) Other Carryback Claims Allowed in Docketed Cases Taxpayers may claim a net operating loss or unused credit carryback on an amended return using Form 1040X, Amended U.S. Individual Income Tax Return, or Form 1120X, Amended U.S. Corporation Income Tax Return. This is called a claim for credit or refund: A claim for credit or refund is identified on the account module by TC 291 or TC 299. When these transaction codes are present, the taxpayer filed either a Form 1040X (individual) or Form 1120X (corporation). Generally, a TC 299 indicates the Form 1040X or Form 1120X was filed to carry back an unused loss or credit. A TC 291 may or may not be the result of the Form 1040X or Form 1120X being filed to carry back an unused loss or credit. Compliance usually secures Form 1040X or Form 1120X and places it in the case file along with the return. If the form is not in the case file, the ATE should take steps to secure a copy so an analysis can be made to determine what year the carryback originated and the amount of the carryback allowed. Further discussion of other carryback claims (Form 1040X or Form 1120X) is found at IRM 8.17.4.14, Tentative Allowances and Other Carryback Claims in Notice of Deficiency Statement.
Procedures for Separate to Joint Returns: Non-filers
8.4.1.12.3 (02-16-2022) Procedures for Separate to Joint Returns: Non-filers If a taxpayer-husband and taxpayer-wife file an original return prior to submission of a case to court for decision, they will be allowed joint rates if they have not previously filed separate returns. Note: The preparation of a return by the IRS Commissioner on behalf of the taxpayer under IRC 6020(b) and the issuance of a statutory notice of deficiency do not constitute a prior return of the taxpayer in determining whether a joint return election is allowable. If the joint return is filed after submission of a case to court for decision, the joint rates will not be allowed. Submission of a case to court for decision occurs when the case has been either fully stipulated or tried and submitted to the court for opinion and decision. See CCDM 35.1.2, Tax Court Terms and Definitions.
Statements of Account for Docketed Cases
8.4.1.12.4 (03-18-2014) Statements of Account for Docketed Cases A Form 3623, Statement of Account, may be required for a docketed case. See IRM 8.17.3, Preparing a Statement of Account, for details on when a statement of account is required and how to request one.
Determining if Refund is Allowed on Docketed Overpayment Cases - Non-Filing Taxpayers
8.4.1.13 (10-26-2007) Determining if Refund is Allowed on Docketed Overpayment Cases - Non-Filing Taxpayers IRC 6512 governs overpayments allowable by the Tax Court. For tax years ending before 8/6/1997, IRC 6512(b)(3)(B) and IRC 6511 entitle a taxpayer who does not file a return to receive a refund of taxes paid within two years prior to the date of the mailing of the notice of deficiency. For tax years ending before 8/6/1997, if a statutory notice is issued to a non-filing taxpayer more than two, but less than three, years after the due date of the return and the taxpayer petitions the Tax Court, any payments made more than two years prior to the date of the issuance of the notice of deficiency (such as withholding) are barred from being refunded. Note: If the taxpayer did not petition the Tax Court, IRC 6511 governs the refund and whether it is allowable. If the taxpayer files a return after the statutory notice is issued in the situation described in (2), above, the refund is still barred even if the return is filed within three years of the due date. See Commissioner v. Lundy, 516 U.S. 235 (1996). To correct possible inequities, Congress modified IRC 6512(b)(3) in the Taxpayer Relief Act of 1997, PL 105–34, August 5, 1997: For tax years ending after 8/5/1997, if a statutory notice is issued to a non-filing taxpayer more than two years, but less than three years, after the due date, and the taxpayer petitions the Tax Court, IRC 6512(b)(3)(B) now allows a refund of tax paid within the three-year period prior to the deficiency notice. Carefully analyze the case file in all docketed cases involving overpayments where the taxpayer did not file a return, since it is possible the refund could be barred.
Recovering Litigation Costs
8.4.1.14 (10-01-2012) Recovering Litigation Costs An award of litigation costs, attorney's fees or court costs may be appropriate for docketed cases settled, whether by Appeals or Counsel, or decided by the Tax Court. These cases require approval by Counsel and are forwarded to them for action. These cases are not input on the Cases menu in ACDS. See IRM 8.7.15, Administrative Cost and Qualified Offer Cases.
Interim Assessments for Docketed Cases
8.4.1.15 (09-13-2019) Interim Assessments for Docketed Cases An interim assessment is an assessment (other than a jeopardy assessment) of tax and penalty made after the issuance of the statutory notice. Examples of interim assessments include: Amounts paid by the taxpayer on the deficiency determined by the Service. A taxpayer has not filed a return before the statutory notice of deficiency was issued, later files a return after the issuance of the notice of deficiency and the Campus assesses the tax shown in the delinquent return. A taxpayer files an amended return that is assessed and then petitions Tax Court.
Advance Payment Remittances on Docketed Cases
8.4.1.15.1 (09-13-2019) Advance Payment Remittances on Docketed Cases Procedures for advance payment remittances in docketed cases are the same as in nondocketed cases. Assessment may be made at any time upon a specific request from Counsel or from the taxpayer. For details on processing advance payment remittances, see IRM 8.20.6, Interim Actions. ATEs who process remittances should see IRM 8.7.17, Appeals Remittance Procedures, for more information.
Closing Docketed Cases
8.4.1.16 (08-29-2025) Closing Docketed Cases Unless an agreement has been reached between Appeals and Counsel on a particular case, ATEs working docketed cases must follow the deadlines contained in section 3.07 of Rev. Proc. 2016-22 for returning cases to Counsel: For regular cases where the amount at issue for each year is $50,000 or less, as well as for all S cases, Counsel may recall the case after six months. If Counsel does not recall the case, Appeals must return the case so that it is received by Counsel no later than 30 calendar days before the date of the calendar call. For all other docketed cases, Appeals must return the case to Counsel at the first to occur of: (i) the date Appeals concludes that the case is not susceptible to settlement, or (ii) within 10 calendar days after the case appears on a trial calendar. Reminder: While the revenue procedure permits extensions of these deadlines when settlement appears "reasonably likely," Counsel and Appeals must both agree to any extension. If an agreement to extend a deadline is reached with Counsel, the ATE should document that agreement in the CAR. If Appeals cannot reach agreement with a petitioner or AOR to resolve a docketed case, or if Appeals sends decision documents but does not receive executed decision documents from the petitioner or AOR as instructed, the ATE will follow the instructions in IRM 8.4.1.18, Docketed Case Not Settled by Appeals – Jurisdiction Released to Counsel, to return the case to Counsel for trial preparation. If Appeals reaches a settlement on a docketed case with a petitioner or AOR, the closing method used by the ATE depends on two factors: whose responsibility it is to prepare the decision documents (Appeals or Counsel), and whether the petitioner or AOR has accepted electronic delivery of the decision documents. The following chart directs ATEs to the appropriate closing method for each of the available combinations of those two factors: Party responsible for drafting decision document Electronic delivery accepted Electronic delivery declined Appeals Electronic Delivery Method (see IRM 8.4.1.16.1) EZ Close (see IRM 8.4.1.16.3) Counsel Electronic Delivery Method (see IRM 8.4.1.16.1) Letter 1220 Method (see IRM 8.4.1.16.2) Caution: The closing method determined by the table above is mandatory. Thus, for example, an ATE is not permitted to use EZ Close if the table above directs the ATE to use the Letter 1220 Method for closing a specific case. The closing methods described in this IRM and its subsections are not to be used for closing cases subject to TEFRA or the Bipartisan Budget Act of 2015 (BBA). Instead, see IRM 8.19.13, Docketed and Department of Justice Cases, and IRM 8.19.14, Bipartisan Budget Act of 2015 Procedures, for TEFRA and BBA cases, respectively.
Electronic Delivery Method
8.4.1.16.1 (08-29-2025) Electronic Delivery Method For cases in which the petitioner or AOR accepts electronic delivery, regardless of whether Appeals or Counsel is responsible for drafting the decision document, the ATE will use the Electronic Delivery Method to transmit the decision document and close the case. After the decision document has been prepared by Appeals or Counsel and uploaded in ACDS, the ATE will gather the settlement computations and decision documents and transmit them to the petitioner or AOR using the agreed-to, IRS-approved method for electronically transmitting documents. The ATE will await the return of the signed decision document from the petitioner or AOR. If a properly executed decision document is not received from the petitioner or AOR within 15 business days, the ATE will close the case unagreed for trial preparation. See IRM 8.4.1.16 (2), Closing Docketed Cases, and IRM 8.4.1.18, Docketed Case Not Settled by Appeals – Jurisdiction Released to Counsel. Upon receipt of a properly executed decision document from the petitioner or AOR, the ATE will confirm that the decision document returned matches the decision document sent to the petitioner or AOR and will upload the original, unaltered file received from the petitioner or AOR in ACDS. The ATE will then prepare and upload the following documents in ACDS: The Appeals Case Memorandum (ACM); The Schedule of Adjustments (SOA); Form 5402, Appeals Transmittal and Case Memo, which advises the ATM on its face whether Appeals or Counsel prepared the decision document; A PDF file containing the CAR history of the ATE's actions on the case; and Any other documents needed to close the case (e.g., Form 3870, Request for Adjustment). The ATE will input ACDS action code AC-FR, which signifies that the case is being submitted to the ATM fully resolved. The ATE will then submit the case, including any paper files, to the ATM for review. Upon receipt of the case, the ATM will take the following actions: Review the case, including the settlement recommended by the ATE. For cases with decision documents prepared by Appeals, review the decision document prepared by the ATE to ensure it: (a) reflects the approved terms of settlement; (b) addresses all years or issues, deficiencies, additions to tax, and penalties in the statutory notice(s) of deficiency or notice(s) of determination; and (c) is prepared in accordance with Tax Court Rule 23; Assuming the settlement terms are acceptable and accurately reflected on any Appeals-drafted decision document, sign the Form 5402, and reattach the signed Form 5402 to the CAR in ACDS. (If the case must be returned to the ATE for additional work or correction of errors, the ATM will remove the AC-FR, advise the ATE of the additional work required, and return the case to the ATE.) Enter the ATM approval (ACAP) date. Route any paper files to APS.
Letter 1220 Method
8.4.1.16.2 (08-29-2025) Letter 1220 Method For cases in which electronic delivery was declined by the petitioner or AOR and for which Counsel is responsible for drafting the decision document, the ATE will use this Letter 1220 Method to transmit the decision documents for signing and close the case. After Counsel has provided the decision document to the ATE, the ATE will upload the decision document in ACDS (or ensure it has been uploaded in ACDS). The ATE will then prepare and upload either Letter 1220, Docketed Case Decision Document Transmittal – Deficiency, if the settlement results in a deficiency, or Letter 1220-A, Docketed Case Decision Document Transmittal - No Amount Due, if the settlement results in no amount due. The ATE will list any additional enclosures (e.g., settlement computations) that are included in the mailing to the petitioner or AOR and will ensure that those documents have been uploaded in ACDS. The ATE will prepare all listed enclosures, including the decision document in triplicate. If mailing to an authorized representative is necessary, the ATE will also prepare Letter 937, Transmittal for Power of Attorney, and include a copy of the Letter 1220 or Letter 1220-A to the petitioner and one copy of each of its enclosures sent to the petitioner. The ATE will await the return of the signed decision document from the petitioner or AOR. If a properly executed decision document is not received from the petitioner or AOR within 15 business days, the ATE will close the case unagreed to Counsel for trial preparation. See IRM 8.4.1.16 (2), Closing Docketed Cases, and IRM 8.4.1.18, Docketed Case Not Settled by Appeals – Jurisdiction Released to Counsel. Upon receipt of a properly executed decision document from the petitioner or AOR, the ATE will confirm that the decision document returned matches the decision document sent to the petitioner or AOR. The ATE will then scan and upload the documents received from the petitioner or AOR in ACDS. Before submitting the case to the ATM, the ATE will prepare and upload the following documents in ACDS: The ACM; The SOA; A PDF file containing the CAR history of the ATE's actions on the case; Form 5402, which advises the ATM on its face that Counsel prepared the decision document; and Any other documents needed to close the case (e.g., Form 3870). The ATE will then enter the AC-FR and submit the case, including any paper files and the executed decision documents, to the ATM for review. Upon receipt of the case, the ATM will take the following actions: Review the case, including the settlement recommended by the ATE; Review the decision document prepared by Counsel to ensure it: (a) reflects the approved terms of settlement, (b) addresses all years or issues, deficiencies, additions to tax, and penalties in the statutory notice(s) of deficiency or notice(s) of determination; and (c) is prepared in accordance with Tax Court Rule 23. Assuming the settlement terms are acceptable, sign the Form 5402, and reattach the signed Form 5402 to the CAR in ACDS. (If the case must be returned to the ATE for additional work or correction of errors, the ATM will remove the AC-FR, advise the ATE of the additional work required, and return the case to the ATE.) Enter the ACAP date. Route the case (including but not limited to the executed decision documents) to APS so it can be transmitted to Counsel.
EZ Close
8.4.1.16.3 (08-29-2025) EZ Close For cases in which electronic delivery was declined by the petitioner or AOR and for which Appeals is responsible for drafting the decision document, the ATE will use this EZ Close method for closing the case. Even if a case would qualify to be closed via EZ Close based on paragraph (1), above, EZ Close cannot be used for any cases subject to TEFRA or BBA. Instead, see IRM 8.19.13, Docketed and Department of Justice Cases, and IRM 8.19.14, Bipartisan Budget Act of 2015 Procedures, for TEFRA and BBA cases, respectively. The ATE will prepare the decision document and review it for accuracy and format. In addition to preparing the decision document, the ATE will also prepare and upload to ACDS, or will ensure that the following documents have been uploaded to ACDS: Document Number of copies (see Note, below) Undated Letter 5534, Decision Transmittal 1 copy to each signatory (petitioner if pro se, or AOR) 1 copy to attach to Letter 937 to the POA (if any) Copies of all letters for the administrative file Note: Ensure that the final paragraph of Letter 5534 uses the phrase "within 30 days from the date of this letter" to properly advise the petitioner or AOR when Area Counsel will begin preparing the case for trial if properly executed decision documents are not returned. Undated Letter 937, Transmittal for Power of Attorney (if needed) For each POA: 1 copy to use as a cover letter to transmit a copy of the Letter 5534, decision document, and settlement computation (if any) 1 copy to retain in the administrative file Decision document 3 copies to include with each Letter 5534 to a signatory 2 to return signed to Counsel 1 to retain for their records 1 copy to include with each Letter 937 to a POA (if applicable) 1 copy for the administrative file Settlement computation 1 copy for each signatory to retain 1 copy for each POA (if applicable) 1 copy for the administrative file Note: The Number of copies column, above, indicates the number of each document sent to the petitioner, authorized representative, or AOR. To indicate that the case is being closed by EZ Close, the ATE will input feature code EZ. Before submitting the case to the ATM for closure, the ATE will prepare and upload the following documents in ACDS: The ACM; The SOA; Form 5402, which advises the ATM on its face that Appeals prepared the decision document; A PDF file containing the CAR history of the ATE's actions on the case; and Any other documents needed to close the case (e.g., Form 3870). The ATE will enter the AC-FR and submit the case, including any paper files, to the ATM for review. Upon receipt of the case, the ATM will take the following actions: Review the case, including the settlement recommended by the ATE; Review the decision document prepared by the ATE to ensure it: (a) reflects the approved terms of settlement; (b) addresses all years or issues, deficiencies, additions to tax, and penalties in the statutory notice(s) of deficiency or notice(s) of determination; and (c) is prepared in accordance with Tax Court Rule 23. Assuming the settlement terms are acceptable and accurately reflected on the decision document, sign the Form 5402, and reattach the signed Form 5402 to the CAR in ACDS. (If the case must be returned to the ATE for additional work or correction of errors, the ATM will remove the AC-FR, advise the ATE of the additional work required, and return the case to the ATE.) Verify that feature code EZ has been entered on the case. Enter the ACAP date. Mail, or arrange to be mailed, the transmittal letters and enclosures (including but not limited to decision documents). When the ATM enters an ACAP date, a new record for STIPFF is generated in APS inventory. An APS PTM assigns each record for processing. Depending on the presence or absence of the following feature codes at closing, the ATE may have to take the corresponding action: Presence or absence of certain feature codes Meaning Corresponding action to be taken by ATE Neither feature code EC nor feature code PL is present on the case This case has a paper administrative file. The ATE will send the paper file to APS for suspense until the decision is entered. Both feature code EC and feature code PL are present on the case. This case has a paper administrative file. The ATE will retain the paper file until the case is fully closed by APS. All processing actions are taken using ACDS attachments. The Electronic Case Closures (ECC) process should be followed. Only feature code PL is present This case is a paperless case. All processing actions will be taken using ACDS attachments. Note: See IRM 8.20.7.2.4, Electronic Case Closures (ECC), for more information.
Decision Documents Sent via EZ Close and Returned to Counsel
8.4.1.16.3.1 (08-29-2025) Decision Documents Sent via EZ Close and Returned to Counsel Under EZ Close, Counsel will receive executed decision documents directly from the petitioner or AOR. Upon receipt of a decision document, Counsel will review it for accuracy and to ensure that no alterations were made by the petitioner or AOR. If the decision document has no errors or alterations, Counsel will countersign the decision and file it with the Tax Court. If the decision document returned to Counsel contains an error (or errors) that prevent Counsel from filing it with the Tax Court (e.g., a misspelled name), the docket attorney or paralegal will send an encrypted email to the ATE and ATM, along with a carbon copy to *Team TL, advising the ATE and ATM that the decision document cannot be filed and detailing the error(s) that prevent it from being filed. Within seven business days of receiving the email from Counsel detailing the error(s) in the decision document, the ATE will take the following actions: contact the petitioner or AOR and advise them of the error(s) in the previously executed decision document, which will require transmission of a corrected decision document and re-execution; prepare a new Letter 5534 to the petitioner or AOR and corrected decision document, and upload both documents to ACDS; mail the new Letter 5534 to the petitioner or AOR that transmits the corrected decision document in triplicate; and send an encrypted email to the docket attorney or paralegal, which advises them of the date the corrected decision document was re-sent to the petitioner or AOR and transmits a copy of the corrected decision document. If the decision document returned to Counsel contains alterations that indicate the petitioner or AOR no longer agrees with the settlement terms, Counsel will keep the case and place it in trial preparation status.
Decision Documents Sent via EZ Close and Not Returned to Counsel
8.4.1.16.3.2 (08-29-2025) Decision Documents Sent via EZ Close and Not Returned to Counsel If Counsel does not receive signed decision documents from the petitioner or AOR within 21 calendar days of the date of the letter transmitting the decision documents, the docket attorney or paralegal will contact the petitioner or AOR to obtain the signed decision document. If Counsel reaches the petitioner or AOR and they state that they no longer agree with the settlement terms, Counsel will keep the case and place it in trial preparation status. If Counsel cannot reach the petitioner or AOR and the decision document is not returned to Counsel within 30 calendar days of the date of the letter transmitting the decision documents, Counsel will keep the case and place it in trial preparation status. If the petitioner or AOR states they did not reach an agreement with Appeals to resolve the dispute, Counsel will review the CAR uploaded by the ATE in ACDS. If the CAR contains all elements that confirm that an agreement was, in fact, reached (i.e., a conference-held entry and a statement that "settlement reached; petitioner/AOR agrees to sign decision documents") and, if appropriate, the petitioner or AOR confirms the accuracy of the statements regarding the settlement being reached contained in the CAR, Counsel will keep the case and place it in trial preparation status. If the CAR does not contain all the elements that confirm a settlement was reached and agreed to, or if the petitioner or AOR does not agree with the accuracy of the statements regarding a conference being held and an agreement being reached, the docket attorney or paralegal's Associate Area Counsel (AAC) will contact the Senior Operations Advisor (SOA) of the Appeals employee who made such representations in the CAR. The AAC will notify *Team TL by email, and the AAC and SOA will discuss transferring jurisdiction of the case back to Appeals. If the case is to be returned to Appeals' jurisdiction, the ATM, ATE, AAC, and docket attorney or paralegal will make arrangements for the case to be returned to Appeals for additional work. If agreement between the AAC and SOA cannot be reached, Counsel and Appeals may elevate the issue to their respective executives to discuss the case, including whether the taxpayer or AOR and Appeals had a settlement conference and reached a settlement in the case. For any cases which Appeals closed agreed via EZ Close but which are now changed to trial preparation status, Counsel will alert Appeals via the Appeals Shared Programs Hub, Electronic Case Receipts/Support Work Requests/APS – Case Update Requests SharePoint site that the case should be returned to Counsel for trial preparation. If requested by APS, the assigned ATE will promptly return to Counsel any paper administrative files they are holding for the case (and any related cases).
Closing Agreements in Docketed Cases
8.4.1.17 (09-13-2019) Closing Agreements in Docketed Cases See IRM 8.13.1, Processing Closing Agreements in Appeals, for procedures to secure and process closing agreements in docketed cases. A closing agreement may be entered into at any time before the tax period comes within the jurisdiction of an appropriate court, and may thereafter be entered into in appropriate circumstances when authorized by the court (e.g., certain bankruptcy situations). A closing agreement must not determine the amount of tax liability (or deficiency or overpayment) for any taxable period under the jurisdiction of the United States Tax Court.
Docketed Case Not Settled by Appeals - Jurisdiction Released to Counsel
8.4.1.18 (08-29-2025) Docketed Case Not Settled by Appeals - Jurisdiction Released to Counsel When Appeals cannot reach agreement with the petitioner or AOR, or if the petitioner or AOR does not return properly executed decision documents to the ATE as instructed, the ATE will close the case to Counsel for trial preparation. If the determination is made while speaking with the petitioner or AOR that a settlement cannot be reached, the ATE will ask if they may transmit closing Letter 971, Letter Advising No Settlement Reached – Docketed Case, via an IRS-approved electronic delivery method. As part of that discussion, the ATE will discuss available IRS-approved options for transmitting the closing letter electronically. If applicable, the ATE will document the corresponding CAR with the details of the discussion with the petitioner or AOR, as well as the details of the discussion and their responses regarding electronic delivery of the closing letter. The ATE will prepare the final drafts of, and upload in ACDS, the following items: The ACM; The SOA; Form 5402; A PDF file containing the CAR history of the ATE's actions on the case; Letter 971, Letter Advising No Settlement Reached - Docketed Case; and Any other documents needed to close the case (e.g., Form 3870). The ATE will enter the AC-FR in the CAR and notify the ATM via secured email: (i) that the case is ready to close for trial preparation, and (ii) if the ATE is holding a paper administrative file for the case. The ATE will also enter feature codes EC and PL. The ATM will review the materials uploaded in ACDS and either enter the ACAP and sign the closing Letter 971 or return the case to the ATE for further work. (If the ATM returns the case to the ATE for further consideration, the ATM will remove the AC-FR.) The ATM will review the case for feature codes EC and PL and will enter them if they are missing. ACDS will then automatically notify APS that the case has been closed by the ATE for trial preparation. After entering the ACAP, the ATM will email the ATE to notify them that the case is closed. After receiving notice from the ATM that the ACAP has been entered, the ATE will then take the following actions as soon as possible: If the petitioner or AOR has accepted electronic delivery of the closing letter, date the ATM-signed Letter 971 and send it to the petitioner or AOR via the agreed-to, IRS-approved electronic delivery method. If the petitioner or AOR has not accepted electronic delivery of the closing letter, print the ATM-signed Letter 971, date it, and send it via U.S. Mail to the petitioner or AOR. If the ATE is holding a paper administrative file for the case, ship the file directly to the assigned Counsel attorney identified in the answer in ACDS at the address identified in the answer unless the ATE has been advised by Counsel that the case has been reassigned. For reassigned cases, ship the paper administrative file to the office address of the newly assigned docket attorney or paralegal. (If the case was reassigned, the Counsel attorney should have provided the ATE with notice of the change.)
United States Tax Court Calendars for Trial Sessions
8.4.1.19 (08-09-2011) United States Tax Court Calendars for Trial Sessions The Tax Court regularly issues calendars for trial sessions. The calendars list petitioners' names, case docket numbers, trial session date and location (city and state). A trial session's calendar also lists cases in which motions are calendared for hearing at a trial session. The Tax Court posts all session schedules to its website, http://www.ustaxcourt.gov. Tax Court judges sometimes issue orders requesting specific actions by the IRS that may impact Counsel/Appeals calendar timeframes or document submissions. Appeals employees should pay particular attention to the requirements of any orders of this nature issued by a Tax Court judge.
Appeals Technical Employees Attending Trial
8.4.1.19.1 (09-13-2019) Appeals Technical Employees Attending Trial ATEs may be present at Tax Court calendar trial sessions to consider cases amenable to settlement. Appeals' consideration is requested by Counsel or the Tax Court judge. ATEs may, with the appropriate approval, in accordance with local procedures, attend trials for cases in which they were involved. ATEs may also be permitted to attend trials for training purposes.
ACDS Tax Court Calendar Program (TAXCAL)
8.4.1.19.2 (10-01-2012) ACDS Tax Court Calendar Program (TAXCAL) The Tax Court Calendar program (TAXCAL) is a subsystem of ACDS developed and maintained by Appeals. The TAXCAL program provides Appeals offices with a method to identify and monitor Tax Court calendar cases and generate Tax Court calendar reports within ACDS. As soon as a calendar is established, Counsel provides Appeals with an electronic file for each Tax Court Calendar to upload into TAXCAL. Fresno APS is responsible for uploading all Tax Court Calendars onto TAXCAL. The TAXCAL functionality is menu based and user-friendly. Based upon the permissions of the user, the program allows appropriate functionality. The TAXCAL permissions levels are as follows: (14000) Tax Calendar (14100) Tax Calendar, User (14200) Tax Calendar, Coordinator (14300) Import Electronic Calendar - restricted permission ACDS' web-based technology allows the program to match a docket number to any case on ACDS, in any Appeals office. A calendared case input on a Tax Court calendar created in any Appeals office will appear on the appropriate group's or ATE's report. The TAXCAL program provides the following functionality: Ability to electronically import or manually create an ACDS Tax Court Calendar; Matching calendar cases to ACDS cases and providing a status report for Counsel; Notification to the assigned ATE when the case appears on a calendar; Link on the TAXCAL record to email the calendar coordinator or assigned ATE; and Ability to add comments to the TAXCAL record. Tax Court Calendars are the responsibility of both the Field Appeals and the Campus Appeals offices. A TAXCAL report listing all Dockets on the calendar in Docket Number order should be generated by the Field Appeals office and faxed to the Field Counsel responsible for the calendar within five business days of receipt of the calendar. This list shows the name of the ATE assigned to the case and if the case is unassigned or unmatched. The Field Appeals office is responsible for resolving unassigned or unmatched cases. Appeals provides Field Counsel with periodic calendar status reports. The Appeals office responsible for the calendar generates the report monthly. These calendar status reports are generated from TAXCAL and provide the following information: Name of the docketed case; Taxpayer Identification Number (TIN) of the docketed case; Docket number; Name of the ATE assigned the case, if assigned; Attorney/paralegal assigned to the case as shown on ACDS; Closing code and date closed, if applicable; and "Status" of the case The report is forwarded to each Field Counsel responsible for the calendar. Field Counsel updates the list with the name of the attorney/paralegal assigned to the case within two workdays from the date of receipt of the list. Field Counsel delivers or faxes the list back to the Appeals office responsible for the calendar so that the ACDS database can be updated with the corrections. Subsequent lists contain those corrections. The TAXCAL Users' Manual is posted on the Appeals website on the ACDS page.
Reconsideration Cases (Closing Code 42) - Jurisdiction Returned to Appeals by Counsel
8.4.1.20 (09-13-2019) Reconsideration Cases (Closing Code 42) - Jurisdiction Returned to Appeals by Counsel Counsel and Appeals may agree jurisdiction will be returned to Appeals for settlement in a docketed case with strong likelihood of settlement for all or part of the case. The reasons for returning the case to Appeals must be well defined, preferably in writing, before Appeals accepts the work unit from Counsel. If a Campus Appeals office forwards a case to Field Counsel for "trial preparation" and, subsequently, the petitioner or counsel of record wishes to discuss "settlement" , presents new information or decides to settle based upon Appeals' settlement offer, Field Counsel may return case jurisdiction to Campus Appeals when all agree there is a strong possibility of settlement and the case is not on a Tax Court calendar. If the case is on a Tax Court calendar, Field Counsel may return the case to Field Appeals for reconsideration. If Counsel returns the case to Appeals for reconsideration, Appeals will accept jurisdiction of the case and the following administrative actions should be taken: APS will update the case from Part 3 to Part 2 on ACDS with input of Closing Code 42. This action will be initiated by the ATM or ATE immediately either: routing the case to APS with appropriate instructions, or preparing and electronically submitting an ACDS Update Request Form. See IRM 8.20.6.13(4), Docketed Reconsideration Cases (Closing Code 42) - Jurisdiction Returned to Appeals by Counsel, for more information. See IRM 8.4.1.8 (5), Preliminary Review of Assigned Docketed Case, for more information on preparing and submitting an ACDS Update Request Form. If an AC/FR was previously input on the CAR, the ATM will input **RR to reflect the case is being returned to the assigned technical employee. This will change the prior AC/FR to a Miscellaneous Action (MS). Or, if the case needs to be reassigned to a different technical employee, the ATM will reassign and input **RR on the CAR. After reconsideration, the ATE will input AC/FR and submit the case to the ATM. The ATM will input a revised ACAPDATE and submit to APS for closing. In all cases, Appeals: is responsible for any "reconsideration" activities, and conducts the settlement negotiations. Note: APS must be alerted regarding any docketed case originally considered by Campus Appeals but returned by Field Counsel to a Field Appeals office for reconsideration/reinstatement. As explained in paragraph (5)a, above, the receiving ATM or ATE must immediately notify APS that the case has been returned from Counsel to Appeals for reconsideration. APS will ensure that the Audit Information Management System (AIMS) and ACDS databases correctly reflect the Appeals office handling the reconsideration. APS will also ensure that ACDS is updated to Part 2 from Part 3, to properly reflect Appeals' jurisdiction and maintain Appeals' statute controls. Note: APS must also be alerted regarding any docketed case returned by Field Counsel to an ATE for reconsideration/reinstatement. As explained in paragraph (5)a, above, the receiving ATM or ATE must immediately notify APS that the case has been returned from Counsel to Appeals for reconsideration. APS will update ACDS to Part 2 from Part 3, to properly reflect Appeals' jurisdiction and to maintain Appeals' statute controls. When the case is in Counsel's jurisdiction, it is in Part 3 on ACDS. When the case is returned to Appeals for reconsideration, APS inputs Closing Code 42 and a date closed equal to the date the case is received for reconsideration. This changes the "Part" on the open ACDS record from 3 to 2. The closed ACDS record retains Part 3 and the closing information.
Dismissed Cases
8.4.1.21 (08-09-2011) Dismissed Cases A distinction must be made between cases dismissed for lack of jurisdiction and cases dismissed for lack of prosecution. A dismissal for lack of jurisdiction is not a determination on the merits, and the Order of Dismissal does not reflect a deficiency amount. A dismissal for lack of prosecution is considered to be a final determination on the merits, and the Order of Dismissal includes a deficiency amount.
Dismissed for Lack of Jurisdiction
8.4.1.21.1 (09-13-2019) Dismissed for Lack of Jurisdiction The Tax Court may dismiss a case for lack of jurisdiction for a variety of reasons, such as: The petition was not filed timely, The petitioner did not pay the filing fee, or A notice of deficiency or notice of determination was not issued. Generally, a Tax Court dismissal for lack of jurisdiction does not favor the taxpayer; however, the dismissal can be based on circumstances that do favor the taxpayer. For example, a deficiency notice may be determined to be invalid because it was not sent to the taxpayer's last known address. The Tax Court lacks jurisdiction over a case that is based upon an invalid notice. These situations need to be handled on a case-by-case basis. If the statute of limitations is still open, Appeals may request that the notice of deficiency be reissued to the correct address. Each Appeals office designates an employee with responsibility for review of dismissed cases prior to assessment. In the following circumstances, the ATM considers assigning the case to an ATE and assessing an amount less than the amount shown on the notice of deficiency: There is information in the file, not considered by the originating function, which, if considered, would have resulted in a reduction in the tax determined in the statutory notice of deficiency. The taxpayer provided information not previously available and either Counsel or the Tax Court requested that consideration be given to assessing a reduced amount. There is a clear misapplication of the law, which led to an excessive deficiency determination in the statutory notice. Appeals will not, on its own initiative, contact taxpayers for the purpose of exploring adjustments to the amount of tax determined in the notice of deficiency prior to assessment unless circumstances favor the taxpayer (as described in paragraph (2), above). As a general rule, unless unusual circumstances exist, if a taxpayer contacts Appeals and requests an adjustment after Appeals has made an assessment and closed the case, the taxpayer is advised to request an audit reconsideration with Compliance.
Conditional Dismissals
8.4.1.21.1.1 (08-29-2025) Conditional Dismissals The Tax Court has recently changed how it dismisses some cases, particularly those for which the filing fee has not been paid by the petitioner. For these cases, the court has begun issuing orders that dismiss the case but allow it to be reinstated, in the judge's discretion, if the petitioner takes certain actions by a certain date (e.g., pays the filing fee within 30 days of dismissal). ATEs may learn of dismissals by reviewing their inventory listings for action code ORDENT, by receiving contacts from the assigned Counsel attorney or paralegal, or by conducting docket research on the Tax Court's website. Upon learning of the entry of a dismissal order on an assigned case, the ATE will review the relevant docket record on the Tax Court's website to try to obtain a copy of the dismissal order. If the ATE cannot obtain a copy of the dismissal order from the Tax Court's website, they will send an encrypted email to the assigned docket attorney or paralegal requesting a copy of the dismissal order. Upon receiving a copy of the dismissal order, the ATE will review it to determine if the case is dismissed conditionally or with finality. If the ATE has any questions about the status of the dismissal, they will contact the assigned docket attorney or paralegal. For cases that have been dismissed with finality, the ATE will close the case to APS as soon as possible. For cases that have only been conditionally dismissed by the court, the ATE will hold the case for 45 days from the date the dismissal order was entered by the judge. At the expiration of that 45-day period, the ATE will conduct docket research to determine if the case has been reinstated by the court. If the case has been reinstated by the court, the ATE will request APS to remove the ORDENT action code, and the ATE will update the statute back to DOCKT and remove the statute date. The ATE will then continue to work the case to resolution. If the case has not been reinstated by the court, the ATE will close it to APS for assessment. SeeIRM 8.4.1.21.1, Dismissed for Lack of Jurisdiction, and IRM 8.4.1.21.3, Dismissed for Lack of Jurisdiction for Assessment of Less than the Notice of Deficiency Amount. The ATM will enter the ACAP date, but will not select STIPFF or Trial Prep as the APS action and will instead select APS Reason Code Closing. If the ORDENT/DECENT action code is on ACDS, the ATM will also not enter a SHIPPED action as prompted.
Dismissed for Lack of Prosecution
8.4.1.21.2 (08-09-2011) Dismissed for Lack of Prosecution Appeals gives no further consideration to cases that are dismissed by the Tax Court for lack of prosecution.
Dismissed for Lack of Jurisdiction for Assessment of Less than the Notice of Deficiency Amount
8.4.1.21.3 (08-09-2011) Dismissed for Lack of Jurisdiction for Assessment of Less than the Notice of Deficiency Amount Unless there is concern about an imminent statute of limitations, cases in which additional consideration results in a reduced deficiency are closed by simply assessing a reduced amount. If an imminent statute of limitations is involved, it may be necessary to assess the tax reflected in the notice of deficiency and then work the case as an informal claim for abatement. IF AND THEN Additional consideration of a case results in a reduced deficiency There is no concern about an imminent statute of limitations The case is closed by assessing a reduced amount Additional consideration of a case results in a reduced deficiency An imminent statute of limitations is involved It may be necessary to assess the tax reflected in the notice of deficiency and then work the case as an informal claim for abatement Charge time to the docketed work unit, and when consideration of the case is complete, close the case on ACDS with the appropriate closing code. Closing Code Description 08 Dismissed Compliance Area or Campus issued notice with Appeals time 11 Dismissed for Lack of Jurisdiction and Appeals issued notice 12 Dismissed for Lack of Prosecution and Appeals issued notice 21 Dismissed Compliance Area or Campus issued notice with no Appeals time
Cases Where Dismissal Order is Vacated
8.4.1.21.4 (08-09-2011) Cases Where Dismissal Order is Vacated There may be instances in which a taxpayer is successful in having an Order of Dismissal vacated. In these circumstances, normal consideration by Appeals is appropriate.
Docketed Cases with Unique Features
8.4.1.22 (08-09-2011) Docketed Cases with Unique Features The following subsections briefly cover docketed cases that contain a unique feature. Some refer to other IRM sections, which cover the type of case in more detail.
Docketed Appeals Team Cases
8.4.1.22.1 (08-09-2011) Docketed Appeals Team Cases The supervisor of the assigned Field Counsel attorney will be invited to participate in preconferences on all docketed team cases. For additional information on Appeals' procedures for working team cases, see IRM 8.7.11, Working Appeals Team Cases.
Docketed Personal Holding Company Tax Cases
8.4.1.22.2 (09-13-2019) Docketed Personal Holding Company Tax Cases In cases where the liability in personal holding company tax has been established by a decision of the United States Tax Court, but deficiency dividends have not been paid and a Form 976, Claim for Deficiency Dividends Deductions by a Personal Holding Company, Regulated Investment Company, or Real Estate Investment Trust, has not been filed, the ATE will explain to the taxpayer the actions to be taken to assess the tax and how to secure the benefits of IRC 547.
Docketed Joint Committee Cases
8.4.1.22.3 (08-09-2011) Docketed Joint Committee Cases Appeals is not responsible for Joint Committee reports in docketed cases under Counsel's sole jurisdiction. Such reports are prepared and processed by Counsel. Appeals furnishes Counsel additional information with respect to issues on which Appeals obtained agreement. To the extent such information can only be furnished by Compliance, Appeals will so advise Counsel. For information concerning agreed and unagreed docketed cases that require Joint Committee handling, see IRM 8.7.9, Joint Committee (JC) Cases.
Docketed Cases with Claims
8.4.1.22.4 (10-01-2012) Docketed Cases with Claims An abatement claim filed on a docketed case will not protect the petitioner unless the issue in the claim is included in the petition. If an issue on a claim is not included in the petition, advise the petitioner to amend their pleadings to get the issue before the Tax Court. Do not secure Form 2297, Waiver of Statutory Notification of Claim Disallowance, or issue a notice of claim disallowance on a claim for a year docketed before the Tax Court unless the issue raised in a claim pertains to a carryback which was not put in issue before the Tax Court. In that case, secure a Form 2297 or issue a notice of claim disallowance. The ATE explains to the taxpayer what is to be done on the claim. They are not required to notify the taxpayer in writing of the disposition. See IRM 8.7.7, Claim and Overassessment Cases.
Docketed TE/GE Cases
8.4.1.22.5 (08-09-2011) Docketed TE/GE Cases Issues docketed under the declaratory judgment provisions of IRC 7476 or IRC 7428 are under Counsel's exclusive jurisdiction, regardless of whether TE/GE or an Appeals office issued the final adverse letter that is being petitioned. Appeals does not accept cases after certified/registered adverse determination (application denied) letters are issued. Nor does Appeals accept cases that are docketed under Declaratory Judgment procedures, which are identified by the letter "X" for Exempt Organization (EO) cases and "R" for Employee Plan (EP) cases after the docket number. Such cases are under Counsel's jurisdiction. See IRM 8.7.8, Tax Exempt and Government Entities (TE/GE) Cases, for additional information when a TE/GE case is docketed.
Refund Suits and Cases Settled by Department of Justice
8.4.1.23 (08-09-2011) Refund Suits and Cases Settled by Department of Justice For detailed information concerning the various types of refund suits and the different types of settlements by the Department of Justice, see IRM 8.7.1, Guidelines for Cases with Special Issues.
Procedures for Complying with the E-Discovery Rules to the Federal Rules of Civil Procedure (FRCP)
8.4.1.24 (09-13-2019) Procedures for Complying with the E-Discovery Rules to the Federal Rules of Civil Procedure (FRCP) Discovery refers to the pretrial exchange of information by parties in litigation. The Federal Rules of Civil Procedure (FRCP), as amended in December 2006 and again in 2015, clarify and establish uniform discovery processes and procedures to be used for electronically stored information (ESI). The FRCP place an obligation on the IRS to preserve ESI when litigation in federal courts is initiated or can be reasonably anticipated. Failure to preserve and provide timely discovery material can seriously jeopardize the government's case and potentially lead to sanctions. The Tax Court adopted ESI procedures effective January 1, 2010. Counsel will follow the procedures outlined in Chief Counsel Notice CC-2016-005, which supersedes Chief Counsel Notice CC-2012-017, for all cases in the federal courts, including the Tax Court (with the exception of "S" cases). For more information regarding ESI, see CCDM 34.7.1.1.4, Discovery Obligations to Preserve Evidence, Including Electronically Stored Information. Litigants are required to: Identify relevant ESI that relates to a filed case. Preserve ESI (including metadata). Provide electronically stored data in its native format. Respond to requests within mandated time frames. E-Discovery requests may involve cases worked by a variety of business units, including Appeals. Requests come from Counsel to a single Appeals PPQ&A point of contact (POC) that will provide guidance to affected Appeals employees. The POC will work with employees, Area Directors and managers to ensure appropriate coordination with Information Technology and Counsel. ESI includes but is not limited to: All email and attachments Word processing documents, spreadsheets, graphics and presentation documents Images, text files, text messages Other information stored on hard drives or removable media (e.g., desktops and portable thumb drives) Metadata, databases Instant messages, transaction logs, computer logs, audio and video files Voicemail Web pages Backup and archived material
Source: official text