When is mediation possible?

1. Applicable cases.
   1. Mediation is available for most factual and legal issues, Compliance Coordinated Issues and Appeals Coordinated Issues, some early referral issues when an agreement has not been reached, unsuccessful attempts to enter into a closing agreement under Section 7121, some offer-in-compromise cases, and Trust Fund Recovery Penalty cases
   2. Mediation is not available for issues designated for litigation, docketed cases, most collection cases (except some Offer In Compromise and Trust Fund Recovery Penalty cases), issues where mediation would not be appropriate under 5 USC § 572 or 5 USC § 575, and where mediation would not be in line with sound tax administration, or for frivolous issues. The Service also retains the ability to eliminate other issues from mediation

Mediator Selection

1. An appeals officer, not previously assigned to the taxpayer’s case, acts as the mediator
2. A taxpayer has the option to select an outside co-mediator at cost to the taxpayer. Attributes to look for in a mediator are substantive tax expertise, experience mediating with governmental entities, and prior experience using the co-mediation model.

Procedural Options

1. Generally
   1. Each party must create a summary of issues prior to mediation.
   2. Issues will be discussed during mediation, either with both parties present, or with the mediator meeting with both parties individually.
   3. Each party must have someone present at mediation with the authority to settle.
2. Fast Track Settlement
   1. An Appeals officer is brought to examination, although the jurisdiction of the settlement authority remains with the Examination Division. Appeals officer can suggest a resolution, but both parties can reject it.
   2. Available for LB&I, SB/SE and TE/TG taxpayers.
   3. Settlement request occurs after notice of proposed adjustment but before issuance of 30 day letter.
3. Early Referral to Appeals
   1. The authority and jurisdiction for settlement of a single issue is given to Appeals.
   2. Available only for LB&I taxpayers.
   3. Taxpayer can submit a written request at any time.
4. Post Appeals Mediation
   1. An Appeals officer is brought to mediate, along with the option of a co-mediator.
   2. Available to all taxpayers.
   3. Must request after traditional Appeals have failed.
5. Post Appeals Arbitration: Arbitration is binding and conclusive, and therefore is rarely used.
6. Docketed Cases
   1. Federal district courts and US Court of Federal Claims have adopted Alternative Resolution Disputes.
   2. Rule 124 allows for meditation and arbitration in Tax Court.