US Code

Public Law 119-73 (01/23/2026)

26 U.S.C. § 7123

Appeals dispute resolution procedures

(a)

Early referral to appeals procedures

The Secretary shall prescribe procedures by which any taxpayer may request early referral of 1 or more unresolved issues from the examination or collection division to the Internal Revenue Service Independent Office of Appeals.

(b)

Alternative dispute resolution procedures

(1)

Mediation

The Secretary shall prescribe procedures under which a taxpayer or the Internal Revenue Service Independent Office of Appeals may request non-binding mediation on any issue unresolved at the conclusion of—
(A)
appeals procedures; or
(B)
unsuccessful attempts to enter into a closing agreement under section 7121 or a compromise under section 7122.
(2)

Arbitration

The Secretary shall establish a pilot program under which a taxpayer and the Internal Revenue Service Independent Office of Appeals may jointly request binding arbitration on any issue unresolved at the conclusion of—
(A)
appeals procedures; or
(B)
unsuccessful attempts to enter into a closing agreement under section 7121 or a compromise under section 7122.
(c)

Administrative appeal relating to adverse determination of tax-exempt status of certain organizations

(1)

In general

The Secretary shall prescribe procedures under which an organization which claims to be described in section 501(c) may request an administrative appeal (including a conference relating to such appeal if requested by the organization) to the Internal Revenue Service Independent Office of Appeals of an adverse determination described in paragraph (2).

(2)

Adverse determinations

For purposes of paragraph (1), an adverse determination is described in this paragraph if such determination is adverse to an organization with respect to—
(A)
the initial qualification or continuing qualification of the organization as exempt from tax under section 501(a) or as an organization described in section 170(c)(2),
(B)
the initial classification or continuing classification of the organization as a private foundation under section 509(a), or
(C)
the initial classification or continuing classification of the organization as a private operating foundation under section 4942(j)(3).

Pub. L. 105–206, title III, § 3465(a)(1)112 Stat. 768Pub. L. 114–113, div. Q, title IV, § 404(a)129 Stat. 3118Pub. L. 116–25, title I, § 1001(b)(1)(G)133 Stat. 985(Added , , ; amended , , ; , , .)

Editorial Notes

Prior Provisions

section 7124 of this titleA prior section 7123 was renumbered .

Amendments

Pub. L. 116–252019— substituted “Internal Revenue Service Independent Office of Appeals” for “Internal Revenue Service Office of Appeals” wherever appearing.

Pub. L. 114–1132015—Subsec. (c). added subsec. (c).

Statutory Notes and Related Subsidiaries

Effective Date of 2015 Amendment

Pub. L. 114–113, div. Q, title IV, § 404(b)129 Stat. 3118

“The amendment made by subsection (a) [amending this section] shall apply to determinations made on or after .”
, , , provided that: