The Internal Revenue Service says it is rolling out a new program to help small businesses and self-employed tax payers resolve disputes arising from an audit in record time. The IRS says its new Fast Track Settlement program, is modeled on one currently available to large or midsized businesses with assets of $10 million or more.
In an official announcement detailing the program on the official IRS website, the federal agency explains:
“The Fast Track Settlement (FTS) program is designed to help small businesses and self-employed individuals who are under examination by the Small Business/Self Employed (SB/SE) Division of the IRS.”
The IRS says the program should, in most cases, allow resolution of issues related to an audit within 60 days rather than months or years if the issue goes to appeals and eventually litigation.
The Fast Track Settlement program uses an arbitration process to resolve disputes between the IRS and small businesses under audit. The agency also says businesses taking advantage of the program retain their rights to appeal should the arbitration be unsuccessful.
Appealing for Fast Track Settlement
Application for the IRS Fast Track Settlement program requires filing of Form 14017 along with a brief response to the IRS position on the tax return under audit.
The fast track process is no guarantee of a positive resolution with the IRS. The agency says mediation will generally be handled by an IRS appeals officer who serves as a “neutral party.”
However, the process could help bypass a time-consuming and potentially costly appeals process which can sometimes end in court.
The IRS initially launched a pilot version of the program in 2006. An expanded program was announced in 2008. The IRS says the recent roll out streamlines those earlier programs and makes the option available to all small businesses meeting eligibility requirements.
The reality is that the Fast Track Settlement program may not yield a better result than going through the traditional appeal process. But it could considerably reduce a potentially very unpleasant process that could effect your business long term.
This is nice of the IRS to do. Hopefully it helps a lot of businesses.
Good move. Bureaucracy is resource-consuming. This will definitely help small businesses.
Joshua, very nice post with some great information. As a tax attorney for 35 years, my experience is that these things always sound great, but the reality is often different. A few years ago, the IRS changed their Offer in Compromise procedures to make them more user friendly and there was a lot of press on this. But the reality is that OICs are almost impossible to get; people need to be basically in poverty and have a rich relative to save the day. So this type of announcement should be taken with a grain (or pound) of salt.