rp-15-44.pdf

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PART III

Administrative, Procedural, and Miscellaneous

26 CFR 601.106: Appeals Functions
(Also: §§ 601.202, 601.203; and Part I, § 7123(b))

Rev. Proc. 2015-44

SECTION 1. PURPOSE
This revenue procedure announces the elimination of the Appeals arbitration
program and obsoletes Revenue Procedure 2006-44, 2006-2 C.B. 800, which formally
established the Appeals arbitration program.
SECTION 2. BACKGROUND
Section 7123(b)(2) of the Code requires that the IRS establish a pilot program under
which a taxpayer and Appeals may jointly request binding arbitration on any issue
unresolved at the conclusion of appeals procedures or unsuccessful attempts to enter
into a closing agreement under section 7121 or a compromise under section 7122. To

comply with section 7123(b), on January 18, 2000, Appeals initiated a two-year pilot
program offering arbitration procedures. See Announcement 2000-4, 2000-1 C.B. 317.
On June 30, 2003, Appeals completed an additional one-year pilot of its arbitration
procedures. See Announcement 2002-60, 2002-2 C.B. 28. During these pilot
programs, Appeals offered an opportunity for taxpayers to request arbitration for certain
factual issues that were already subject to the Appeals administrative process. On
October 30, 2006, the IRS published Rev. Proc. 2006-44, 2006-2 C.B. 800, which
formally established the Appeals arbitration program. Generally, arbitration has been
available under these procedures for cases in which a limited number of factual issues
remain unresolved following settlement discussions in Appeals.
In Announcement 2008-111, 2008-48 I.R.B. 1224, published December 1, 2008,
partially superseded by Rev. Proc. 2014-63, 2014-53 I.R.B. 1014, Appeals established
a two-year pilot program to extend arbitration to certain collection cases. Under the pilot
program, taxpayers in select cities were eligible to use arbitration to resolve certain offer
in compromise and Trust Fund Recovery Penalty issues. Announcement 2011-6, 2011-
4 I.R.B. 433, published January 24, 2011, partially superseded by Rev. Proc. 2014-63,
2014-53 I.R.B. 1014, extended the pilot without change through December 31, 2012.
SECTION 3. ELIMINATION OF APPEALS ARBITRATION PROGRAM
This revenue procedure obsoletes Rev. Proc. 2006-44 and eliminates the Appeals
arbitration program. During the fourteen-year period in which arbitration was available,
only two cases were settled using arbitration. Given the general lack of demand for
arbitration and the fact that its use as a tool to settle disputes without litigation has not

proven successful, the IRS is eliminating the arbitration program. Although Appeals
arbitration is being eliminated, taxpayers may be eligible to request mediation for
unresolved issues that remain after completion of settlement discussions in Appeals.
See Rev. Proc. 2014-63, 2014-53 I.R.B. 1014.
SECTION 4. EFFECTIVE DATE
The elimination of the Appeals arbitration program is effective Month DD, 2015, the
date this revenue procedure is published in the Internal Revenue Bulletin.
SECTION 5. EFFECT ON OTHER DOCUMENTS
Revenue Procedure 2006-44, Announcement 2008-111, and Announcement 2011-6
are obsoleted.
DRAFTING INFORMATION
The principal authors of this revenue procedure are Alicia Goldstein, Office of Chief
Counsel, Procedure and Administration, Charmaine Osbin, Office of Appeals, Tax
Policy and Procedure for non-collection cases, and John Gonzalez, Office of Appeals,
Tax Policy and Procedure for offer in compromise and Trust Fund Recovery Penalty
cases. For further information regarding this revenue procedure, contact Ms. Goldstein
at (202) 317-3600, Ms. Osbin at (281) 721-7275, or Mr. Gonzalez at (415) 281-7837
(not toll-free calls).