Settlements in Tax Cases

Summary

This practice note discusses the settlement opportunities that taxpayers have available while pursuing their tax controversy. This note also discusses the two types of formal settlement agreements that the IRS can use: closing agreements and offers in compromise. As with a typical court case, the taxpayer generally has many opportunities to settle a tax controversy. Unlike a typical court case, however, the additional layers of administrative review within the IRS provide both sides with the opportunity to examine objectively the facts and the law, and to reassess their positions in this light.