How to increase taxpayers' use of the IRS’s alternative dispute resolution (ADR) process was one topic of discussion at the tax agency’s National Public Liaison recent meeting in Washington, Accounting Today reported.

The IRS is concerned that not enough taxpayers are taking advantage of this process for resolving disputes, in which an appeals officer trained in mediation techniques works with taxpayers and the IRS employee assigned to the case to reach an agreement.

Meeting attendees lauded the ADR process for its ability to resolve disputes much more quickly than the standard appeals process, according to Accounting Today, which noted that studies have shown that the process ends with both parties being more compliant.

Despite those positive results, ADR usage has been lower than expected and continues to decrease, according to officials. The IRS has convened a cross-functional team to study and provide changes going forward, according to attendee Stephen Mankowski, tax chair at the National Conference of CPA Practitioners, who attended the meeting.

"Some were procedural tweaks, while others were more sweeping recommendations that can improve the system," he told Accounting Today. In the past, some taxpayer claims were denied without explanation. "Now, all denials are required to have details on the results. Also, tentative denial gets reviewed prior to submission to the taxpayer. Public education and internal training will need to occur to encourage taxpayer usage."

Another topic discussed was promoter investigations. These are aimed at detecting and deterring abusive tax promotions and abusive return preparers. Additional topics considered were filing season processing and the Stakeholder Liaison office—which establishes relationships with practitioner and industry organizations as well as other organizations that support the American taxpayer.

The Office of Fraud Enforcement works with the practitioner community, as well as alternate channels, to make referrals. It has partnered with Small Business/Self-Employed Division research to get information at Tax Forums. Nearly all practitioners surveyed were familiar with the term "abusive transactions."

"It can be a fine line between fraud and tax planning, and clarification is needed on the website to illustrate this better, according to respondents in a poll," said Mankowski. "Practitioners felt that simple online submission was important, as well as the IRS releasing statistics. Both help to hold people accountable."

The Stakeholder Liaison office is planning more events in 2024 than at any time in the past, Accounting Today reported. It presents 50 to 60 webinars annually that feature subject matter experts.