A representative of the Office of Appeals will serve as a neutral mediator, unless both parties agree to utilize, exclusively, a Third Party Mediator as requested by the taxpayer. The mediator will use mediation techniques in an effort to facilitate a mutual resolution between the parties. In some circumstances, there may be two representatives from the Office of Appeals serving as co-mediators. There is no cost to the taxpayer to participate in the Early Mediation program, if the taxpayer chooses to have a representative of the Office of Appeals serve as a neutral mediator.
Prior to the mediation session, the taxpayer’s representative and a representative of the Department must complete and sign an Agreement to Mediate, including a Participants List. The Participants List should contain the names and signatures of each individual who will be participating in the mediation (note that this list may be updated if additional parties will participate).
After the Agreement to Mediate has been executed, each party must submit to the mediator a position statement, which should contain a written summation of the facts and issues relating to the mediation and the party’s position/legal arguments, not to exceed 20 pages (exclusive of exhibits consisting of pre-existing documents and reports). The parties must include a statement of all issues, facts and documents that the parties intend to rely upon during the mediation. Any new facts, documents and/or issues raised or presented at the mediation session may unfairly prejudice the proceedings, protract the negotiations, make settlement more difficult, or result in one party or both withdrawing from the mediation. If new issues are raised as part of the mediation, either party or the mediator may elect to suspend the process to develop or confirm additional facts, or either party or the mediator may terminate the mediation. The mediator may ask either party for additional information before the mediation session if deemed necessary for a full understanding of the issues to be mediated.
All communications and/or correspondences relating to the subject matter of the mediation involving the mediator must include all parties, except as otherwise permitted. The mediator will simultaneously send each party a copy of the other party’s position statement.
All efforts will be made to schedule the mediation session within 3 months of the submission of the Application for Early Mediation Program, unless otherwise agreed to by the parties.
During the mediation session, the taxpayer’s and Audit’s representatives (at least one of which with decision-making authority for each party) will meet with the mediator. The decision makers for each side that participate in the mediation are expected to have authority to settle all issues in dispute on the day of the mediation session, or the ability to have substantially immediate contact with those with the necessary settlement authority to settle all issues in dispute on the day of the mediation session. The taxpayer’s and Audit’s representatives should include individuals with the information and expertise necessary to assist the parties and the mediator during the settlement process. Although the taxpayer and Audit may have multiple attendees, each party must designate one person to be the official spokesperson. Each party is strongly encouraged to limit the number of attendees at the mediation session to foster resolution of the disputed matters.
The Early Mediation sessions may include joint sessions with all parties, separate caucuses with each party, or both, as determined to be appropriate in the judgment of the mediator in consultation with the taxpayer’s and Audit’s representatives. The mediation may involve multiple sessions, as determined by the mediator and the parties. Mediation is a voluntary process and all parties must consent to additional sessions.
The mediator will consider only those issues outlined in the Agreement to Mediate, except where the parties mutually agree that the mediator may consider issues not outlined in the Agreement to Mediate.
During the Early Mediation session(s), the mediator may suggest particular settlement terms for any or all issues, which will not be binding on either party. The goal of the mediation is for the parties to reach a mutually agreeable resolution on their own, but if after their best efforts they are unable to do so, the mediator may suggest settlement recommendations. Settlement recommendations would be akin to settlement discussions and therefore not admissible in future administrative or judicial proceedings.