A CDP Hearing and Equivalent Hearing are similar in that the same issues may be considered by the IRS in both hearings. Upon completion of the Equivalent Hearing, the Appeals Officer issues a “Decision Letter.” In general, taxpayers cannot challenge their Equivalent Hearing Decision Letter in court.
Can a taxpayer appeal the outcome of a CDP hearing?
A major advantage of a CDP hearing compared to a CAP hearing is that the determination in a CDP hearing may be appealed to the Tax Court, but the decision in a CAP hearing is binding on both the IRS and the taxpayer, and cannot be appealed.
What is Collection Appeals Program?
The Collection Appeals Program (CAP) is one of two appeals programs available to taxpayers to challenge IRS collection actions. The Program allows the taxpayer to appeal a collection action before or after certain IRS actions. The taxpayer can also use CAP in connection with issues arising under installment agreements.
When can a taxpayer request a CDP hearing?
The taxpayer has the CDP hearing with the IRS Office of Appeals, which is independent and separate from the IRS Collections office. A taxpayer can leverage this option to protest an IRS collection notice, among other possibilities. When Can Taxpayers Request a CDP Hearing?
How is a cap hearing different from a CDP hearing?
A Collection Appeals Program (CAP) is different from a CDP hearing in that it is generally faster and encompasses a broader array of collection actions. Furthermore, a taxpayer cannot bring their case to Tax Court on the appeal’s decision.
When to request an equivalent hearing with the IRS?
The IRS does have deadlines to request an equivalent hearing. For example, the taxpayer has one year plus five business days to request an equivalent hearing after receiving a lien notice. If the taxpayer gets a lien notice, they have one year from the date of the levy notice to request an equivalent hearing.
What does CDP stand for in the IRS?
A Collection Due Process Hearing, also known as a CDP hearing, is one taxpayer option to fix a tax controversy with the IRS. The taxpayer has the CDP hearing with the IRS Office of Appeals, which is independent and separate from the IRS Collections office.
