Despite staffing losses and a hiring freeze, IRS Independent Office of Appeals Chief Liz Askey is “cautiously optimistic” that her team can continue bringing down case cycle time frames.
IRS Independent Office of Appeals is a separate and independent team from the agency’s examination and collection functions. It is tasked with resolving controversies between taxpayers and the IRS impartially and administratively — without litigation. Askey was named Appeals chief last year.
Workforce woes.
Appeals started the calendar year with about 1,777 employees, Askey told an audience at Eversheds Sutherland’s tax seminar on April 30.
It now has about 77 probationary employees currently on administrative leave and no longer able to perform work. In addition, over 300 employees have signed the deferred resignation program agreement with another 100 “outstanding,” Askey said.
Askey explained that all Appeals staff were given the option of deferred resignation. To her, “the more employee-friendly approach” was to make the program available to anyone interested. And with 43% of Appeals staff either retirement-eligible or early retirement-eligible, she said it wasn’t “completely surprising” that a large number of employees took the opportunity to retire.
Askey projects that at the end of the current fiscal year, Appeals with be at about 1,324 employees.
On top of the staff losses, Appeals is also subject to a hiring freeze. That currently applies for both external and internal hiring, said Askey. But she expects once the current reduction-in-force and “workforce reshaping efforts” are complete, that Appeals will — to the extent it is short-staffed — be able to hire from compliance.
Cycle times down.
Amid staffing challenges, Appeals is making good progress toward reducing cycle times, Askey said. “The good news is that the cycle time for non-docketed cases is at the lowest level it has been in six years,” she said.
The National Taxpayer Advocate said in its 2022 report to Congress that taxpayers with non-docketed cases in Appeals could “expect a resolution in an average of 365 days.” That represented a 103% increase over fiscal year 2017 cycle times.
And the Taxpayer Advocate reported back in 2022 that although cycle times “vary depending on the complexity and type of case involved,” times for all major workstreams were trending upward.
Appeals has recently reversed that trend, said Askey, with the average fiscal year 2025 non-docketed case cycle time at 274 days. Askey said she hopes to continue bringing down cycle times despite IRS workforce changes.
Another effort at Appeals over the last year, said Askey, is taking “a hard look” at how long it takes a case to get to Appeals. “That time was also really creeping up,” Askey explained, so Appeals has been working with other divisions to “get that time down” and understand the cause of delays.
And Appeals also has a “paperless pilot” underway where smaller files are scanned “when they come in the door,” said Askey. Previously, case files were carded in manually, shipped to a manager, and then possibly shipped another time once an Appeals Officer was assigned.
Overall, case cycle times are “trending in the right direction,” said Askey. “I’d love to continue to say that a year from now,” she added.
In-person settlement conferences back.
Eversheds Sutherland’s Kristen Martin shared her concerns that Appeals is shifting to virtual settlement conferences. “Clients often find having in-person settlement conferences to be a really valuable experience and opportunity to be heard,” Martin said.
Askey acknowledged that some conferences were shifted to virtual during “a short period of disruption a few months ago when travel policy changed.” But she reported that Appeals now has “a new travel approval process in place.”
“Appeals policy continues to be that we try to accommodate the taxpayer’s desire for the type of conference that they wish to have,” said Askey.
Under the new process, a little more “lead time” is needed to get travel approved, Askey explained. But Appeals Officers should now “be able to travel for in-person Appeals conferences” — and Appeals is “committed to doing that for the larger, more complex cases.”
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