Expert Advice for Negotiating with the IRS

Are you thinking about negotiating with the IRS or another party where it appears there may be important differences of opinion? Do you want to know effective negotiating techniques to work with the IRS? If yes, then you should read the post and find out.

Start negotiating with the IRS by understanding your and their positions. It’s better for you to explore your position and consider your Best Alternative to a Negotiated Agreement (BATNA). You should also consider their position and what you may think is their BATNA.

After you have really listened to them, kept an open mind, and suspended your own judgment, then you can share with them what you think you have heard. Once you confirm what you have heard, share with them your perspective, and see if the IRS has any questions. Once that has been completed consider offering the first alternative position known as an anchor to set the stage for the negotiation. The party that makes the first offer sets the stage for working toward an agreement. This can be very beneficial to you if you have a well-reasoned and legitimate offer.

Then, you have to listen actively to the other party without making any judgment so that you will further understand where they are coming from. You may be aware of the implications of the IRS issue practice networks, the IRS looking for good litigation cases on issues in these areas moving forward, the emphasis of the examination function for closing cases, the additional time for the IRS associated with writing up an unagreed case versus an agreed case. The IRS has a need to close out so many cases within a given form type (1040, 1120, 1120S, 1065, 706, 709 as examples) and of a given size category within the fiscal year. If it is later in the fiscal year and the IRS has a need to close out more returns in your category of return and size this can be to your advantage. The more you know, the more it can impact the negotiation process.


Take the time to frame the negative into a neutral or even into a positive perspective whenever possible. In the end, you should seek advice from professionals with experience in these areas. You need someone with expertise who knows how to focus on these types of issues, work with you, and offer you advice to help you with these types of situations.  Do some research and look for firms with expertise to work with you that focus on constructive approaches with an emphasis on reasonable closure. This type of firm listens and is there to help address conflicts with a focus on closure it can be achieved on examination.

They are realists providing very practical suggestions. Dig deeper than going with a general observation. Find out who you will be working with, their history, and how they will approach this situation. Find an expert with experience in this area specializing in conflict resolution and understanding these types of issues. When you have an expert by your side, he or she will help you save time, money, and mental toil, and work toward closure.

 If you are looking for an expert to address conflicts with IRS on business valuations or other issues business to business or within businesses, you should look no further than Michael Gregory. Mike is a professional speaker, mediator, and negotiator helping clients resolve issues and is productive as well as a conflict resolution expert with the IRS. You can contact Mike directly at mg@mikegreg.com and at (651) 633-5311 to help you in negotiating with the IRS.

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