Will Your Next Tax Appeal Be a Videoconference?

By Joseph D. Brophy, MBA, CPA/ABV, CVA, ABAR, CM&AA, Dallas

Editor: Valrie Chambers, Ph.D., CPA

Fairness in tax administration requires that taxpayers and their representatives be able to access Appeals in a reasonable time frame. Appeals is considering its options for delivering timely access to taxpayers.

Internal Revenue Manual (IRM) Section allows use of virtual service delivery (VSD) for virtual face-to-face meetings in lieu of personal meetings. Currently all six Appeals campus locations and the Taxpayer Advocate Service have the technology.

The IRS also has about 95 locations with Polycom videoconferencing equipment. This equipment is not specifically referred to in the IRM, so it may not qualify as VSD equipment but could functionally be used for Appeals conferences from noncampus sites. IRS Appeals is reviewing how it can best provide timely, efficient access in the context of the staff limitations now imposed by congressional funding limitations.

Richard Stefanski, area director for Appeals Collection Area 11, based in California, demonstrated Polycom equipment in June to a small group of taxpayer representatives assembled by the Texas Society of CPAs in Dallas. Stefanski said the IRS may introduce this technology for use in hearings (outside Service Center current use) by roughly October 2016. The speaker's expectation is that the use of videoconferencing will be optional, which seemed to put the representatives at ease. Having said that, there was general approval in this small group for introducing another medium for conducting appeals.

A number of questions remain to be resolved as to when and how rapidly the IRS will roll out widespread use of videoconferencing for appeals. For instance, the IRS has very high standards on protecting taxpayer privacy, so current thinking appears to be that taxpayer representatives would have to go to an IRS site for a videoconference meeting. However, the current 95 Polycom videoconferencing sites have no simple way for exchanging secure documents.

Another important issue is whether representatives who have access to videoconferencing equipment should be allowed to use their own equipment. Given the high cost of travel to an IRS site for an in-person appeal, a protocol may be needed to allow representatives to use videoconferencing equipment they own or can lease for an Appeals meeting once the necessary privacy issues can be resolved.

A number of issues remain unresolved:

  • Will Appeals officers be selected differently when videoconferencing is used? For instance, if location is no longer an issue, will Appeals assign specialists to cases?
  • Will Appeals as a matter of policy continue to allow taxpayers to opt out of videoconferencing, as now expected?
  • If taxpayers are allowed to opt out of driving to an IRS site, will the IRS allow third-party commercial providers of videoconferencing services? Will the IRS charge a user fee?
  • Will the IRS be able to provide multiple screens so that experts might not have to travel to provide evidence in large cases?
  • What security will suffice for document transmission?

Ultimately, representatives with small cases who have no local Appeals office may benefit from videoconferencing by avoiding travel costs. Even in major cities with Appeals officers available, representatives can spend hours traveling, which would be avoided if the IRS allows use of videoconference equipment outside the IRS site. However, given the choice of an in-person conference (locally), there would appear to be little incentive for anyone to drive to the IRS to have a videoconference, unless the Appeals officer assigned is a long distance away.



Valrie Chambers is an associate professor of accounting at Stetson University in Deland, Fla. Joseph Brophy is with Joseph D. Brophy CPA PC in Dallas. Mr. Brophy is a member of the AICPA Tax Practice & Procedures Committee. For more information about this column, contact thetaxadviser@aicpa.org.


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