MEMORANDUM
Date: [Date]
To: [Group manager (SB/SE) / Case manager and issue manager (LB&I)], [Group or team]
From: [Representative name, firm], for [Taxpayer name]
Subject: Application for Fast Track Settlement, Form 14017, [Form 1040 / 1120 / 1065 / 941 / CVL PEN], tax year(s) [Years]
Taxpayer TIN: [SSN or EIN] Program: [SB/SE FTS (Rev. Proc. 2017-25) / LB&I FTS (Rev. Proc. 2003-40)]
1. Request
The taxpayer requests Fast Track Settlement of the unagreed issues listed in section 3 and submits the enclosed Form 14017 signed by the taxpayer and the undersigned representative. This request is made on [Date], within the pilot period of Announcement 2025-6 (requests made on or after January 15, 2025 and before January 15, 2027). The taxpayer asks that the group manager sign Form 14017 and forward the package to the Appeals team manager. [LB&I: The taxpayer asks that the case manager and the appropriate territory manager sign Form 14017 and email the package to the Appeals FTS mailbox with a copy to the LB&I FTS coordinator.]
2. Eligibility
- The case is a [field / office] examination under [SB/SE / LB&I] jurisdiction, non-docketed, and no 30-day letter has been issued. [If a 30-day letter was issued (SB/SE): A 30-day letter was issued on [date]; the case has not left the group and IRM 4.10.7.5.6.2 directs that the application still be forwarded to Appeals.]
- Each issue is fully developed: all information requested by the examiner has been provided, the examiner has issued [Form 5701 / Form 4549 and Form 886-A / the lead sheets] stating the government’s position, and the taxpayer has stated its position in writing (enclosed). [All referrals, technical advice, Counsel advice and valuation reports have been received / No referral or report is outstanding.]
- The issues remain unresolved after discussion with the examiner on [Dates]. [SB/SE: A conference with the group manager was held on [date]. OR: No pre-FTS managerial conference has been held; under Announcement 2025-6 the pre-FTS managerial conference requirement for SB/SE taxpayers is removed for the pilot period. The taxpayer remains willing to meet with the group manager.]
- The taxpayer cooperated throughout the examination, responded to each information document request by [dates], and did not delay the audit.
- None of the exclusions in [Rev. Proc. 2017-25, section 4.02 / Rev. Proc. 2003-40, section 3.03] applies: the case is not a correspondence examination worked solely in a campus, not a TEFRA partnership case, not a collection case; no issue is designated for litigation, docketed, precluded by a closing agreement, res judicata or controlling Supreme Court precedent, frivolous, a whipsaw issue, or the subject of a competent authority request. [Joint return: Both spouses have signed Form 14017 and will participate in the same session.]
- [If one issue may be ineligible: Issue [number] may be ineligible because [reason]. Under Announcement 2025-6, FTS can be applied to one or more issues in a case, and the taxpayer requests FTS for the remaining issues.]
- Potential Joint Committee case: [No / Yes, refund in excess of $2 million]. Listed transaction: [No / Yes].
3. Issues submitted
Issue 1: [Issue as named on Form 5701 or the report]. Proposed adjustment: [Amount] for [Year]. Examiner’s position: [Form 5701 no. [number] dated [date] / Form 886-A pages [numbers] / lead sheet [number]] (Exhibit 1-A). Taxpayer’s written response: [Letter dated [date]] (Exhibit 1-B). Nature of the dispute: [factual / legal / hazards of litigation]. [One or two sentences on the point in dispute, without argument.]
Issue 2: [Issue]. Proposed adjustment: [Amount]. Examiner’s position: [Reference] (Exhibit 2-A). Taxpayer’s written response: [Reference] (Exhibit 2-B). Nature of the dispute: [Type].
[Repeat for each issue. Penalties proposed on these adjustments: [list, with the Form 14017 marked CVL PEN for separately assessed civil penalty cases].]
4. Participants and logistics
Taxpayer participants with decision-making authority: [Names and titles]. Representative: [Name, credential, CAF number] under the enclosed Form 2848, which authorizes the representative to sign Form 14017 and to consent under IRC 6103(c) to disclosure to the participants named on the form. Other participants: [Names, positions, e.g. appraiser, controller]. Preferred conference site: [City / video]. Dates the taxpayer is available within the next [60 / 120] days: [Dates].
5. Acknowledgments
The taxpayer understands that the Appeals official acts as a mediator and not in the traditional Appeals settlement role, so the ex parte communication rules do not apply to communications in FTS; that any settlement is subject to the same procedures as an Appeals settlement; that a signed Form 14000 session report is not a final settlement and does not waive restrictions on assessment or extend or terminate any period of limitations; that issues not resolved in FTS retain regular Appeals rights; and that the decision not to accept the case is not subject to administrative appeal or judicial review. The assessment statute for each year expires on [Date(s)]; [a consent on Form 872 to [date] has been executed / the taxpayer will consider a consent if Appeals requires one].
6. Checklist of the package
- Form 14017 (Rev. 3-2020), all blocks completed, signed and dated by the taxpayer [and spouse] and the representative; group manager signature block left for the IRS [LB&I: and the Approving Operating Division Official block for the territory manager].
- Separate Form 14017 for each related return and for any unagreed civil penalty case (SB/SE).
- Exhibits 1-A, 2-A and so on: Form 5701 or report pages and workpapers stating the examiner’s position on each issue.
- Exhibits 1-B, 2-B and so on: the taxpayer’s written response to each issue.
- Form 2848 covering the years and authorizing the representative to sign Form 14017 and consent to disclosure.
- [Copies of any executed Form 872 / valuation report / technical advice relied on].
[Representative signature] [Date]
When to apply and under which procedure
Fast Track Settlement brings an Appeals mediator into the case while it is still in Examination’s jurisdiction. SB/SE cases run under Rev. Proc. 2017-25, LB&I cases under Rev. Proc. 2003-40; both are described at Fast Track Settlement. The common precondition is a fully developed issue. Rev. Proc. 2017-25 says FTS “may be initiated at any time after an issue is fully developed,” and “An issue cannot be fully developed prior to the receipt of all necessary referrals, technical advice, Counsel advice, valuation reports, or other relevant documentation.” In LB&I, IRM 4.51.4.5.2.1 says FTS “must be initiated prior to the issuance of the 30-day letter” and treats an issue as developed when the Acknowledgement of Facts IDR and Form 5701 have issued and the taxpayer has responded in writing to both; “Taxpayers do not need to submit a formal protest for FTS.”
Both sides must want it: “Both parties must affirmatively consent to participate in SB/SE FTS,” and “The decision not to accept a case into the SB/SE FTS program is not subject to administrative appeal or judicial review.” The memo is written to make acceptance easy for the two people who decide it, the group manager and the Appeals team manager.
The 2025 pilot rules
Announcement 2025-6 changed four rules for requests “made on or after January 15, 2025 and expire on January 15, 2027,” and left the rest of the revenue procedures in place.
| Rule in the revenue procedures | Pilot rule (Announcement 2025-6) | Where the memo uses it |
|---|---|---|
| “If any one issue is determined not to be eligible for SB/SE FTS, no issues in the case shall be eligible for SB/SE FTS.” (sec. 4.03; same rule in Rev. Proc. 2003-40 sec. 3.03) | “Under the pilot program, FTS can be applied to one or more issues in a case.” | Section 2, optional bullet on a possibly ineligible issue |
| Group manager conference before SB/SE FTS (IRM 4.10.7.5.6.1 and 4.10.7.5.6.2) | The pilot “removes the pre-FTS managerial conference requirements for SB/SE and TE/GE taxpayers.” | Section 2, third bullet |
| Group manager or Appeals team manager may deny | “Requests to participate in FTS and PAM will not be denied without the approval of a first-line executive” | If the application is refused |
| “Post-appeals mediation, however, is not available for any issue considered during the SB/SE FTS process.” (sec. 6.06) | “participation in FTS will not disqualify a taxpayer from PAM.” | Section 5 acknowledgments |
What each section does
Section 2 states the eligibility facts in the order IRM 4.10.7.5.6.1 lists them: issues fully developed and documented, resolution strategies exhausted, and a taxpayer who “has stated a position in writing.” FTS “must be denied” if the taxpayer was uncooperative or gave no adequate written response, which is why the cooperation bullet gives dates. Section 3 is the issue list the package must carry: Rev. Proc. 2017-25 sec. 5.03 requires “properly documented work papers supporting the Examiner’s position, and the taxpayer’s written response,” and Rev. Proc. 2003-40 sec. 4.01 requires the Form 5701 and the written response. Section 4 answers the participant blocks on Form 14017; by signing, the taxpayer consents under IRC 6103(c) to disclosure to the named participants, and a representative who signs needs a power of attorney that clearly authorizes the signature and the consent (sec. 8.02(3)). Section 5 records what Form 14017 says about ex parte communications, which do not apply “because Appeals personnel, in facilitating an agreement between the taxpayer and the other Service Operating Division, are not acting in their traditional Appeals settlement role,” and the statute date, because a failed FTS still has to leave Appeals its 365 days; see Form 872 extensions.
Signatures, routing and timing
| SB/SE (Rev. Proc. 2017-25; IRM 4.10.7.5.6.3) | LB&I (Rev. Proc. 2003-40; IRM 4.51.4) | |
|---|---|---|
| Who signs Form 14017 | Taxpayer(s), representative and group manager; “the territory manager signature is not required in the Approving Operating Division Official section of the form” | Taxpayer, representative, case manager and “the appropriate LB&I territory manager” |
| Who sends it | Group manager reviews within three business days, signs, mails a copy to the taxpayer and sends the package to the servicing Appeals office | Case manager emails Form 14017, the Forms 5701 and the written response to the Appeals FTS mailbox, copy to the LB&I FTS coordinator |
| Who accepts | Appeals team manager confirms eligibility within three business days and assigns a mediation-trained Appeals Officer | Appeals FTS program manager and the LB&I territory managers; notice of non-acceptance within ten days |
| Time frame | “It is a goal of SB/SE FTS that the entire process be completed within 60 days after acceptance into the program.” | “The goal of the FTS program is to complete the entire FTS process in approximately 120 days”; IRM 4.51.4 treats 120 calendar days as a limit absent agreement to extend |
What happens after acceptance
- The Appeals official contacts both sides within five business days of assignment (SB/SE) to schedule the session. It is recorded on Form 14000, Fast Track Session Report; new information is accepted only if it will not push the case past the 60-day or 120-day goal.
- If an issue settles, the parties sign the session report, which “does not waive restrictions on assessment, terminate consents to extend periods of limitation, start the running of any periods of limitation, or constitute agreement to close the case.” The case closes on the examiner’s report with the agreement forms, “including preparation of a Form 906, Closing Agreement on Final Determination Covering Specific Tax Matters, if appropriate” (SB/SE), or a closing agreement or Form 870-AD under the Appeals official’s delegated authority (LB&I). Hazards settlements follow the hazards of litigation guidelines; FTS “creates no special authority for settlement.”
- If the taxpayer accepts the official’s proposal and the group manager rejects it, the territory manager must review the rejection and concur in writing or accept the proposal.
- If an issue does not settle, “the taxpayer retains all of its otherwise applicable appeal rights”; there is no second FTS on the same issues, and the ex parte rules apply again once the case returns for traditional Appeals consideration (sec. 8.01(2)). Post-Appeals mediation stays available under the pilot; see mediation in Appeals.
Mistakes
- Applying before the issue is developed. A pending valuation or technical advice request makes the issue ineligible under section 2.02, and the package comes back.
- No written position. The taxpayer’s written response is a required part of the package; without it the group manager denies the application.
- A Form 2848 that does not reach Form 14017. Section 8.02(3) requires the power of attorney to clearly authorize signing Form 14017 and consenting to disclosure.
- Forgetting the statute. A session report extends nothing. If FTS fails late in the period, Appeals will need a consent before it takes the case.
Questions practitioners ask
Does the taxpayer have to meet the group manager first?
Under IRM 4.10.7.5.6.1 the group manager conference was one of the strategies to exhaust, but Announcement 2025-6 removes the pre-FTS managerial conference requirement for SB/SE and TE/GE taxpayers for requests made through January 15, 2027.
Can we apply for only one of three unagreed issues?
During the pilot, yes: Announcement 2025-6 allows FTS for one or more issues in a case. Under the revenue procedures alone, one ineligible issue made the whole case ineligible.
Who signs for LB&I?
IRM 4.51.4.5.2.1 has Form 14017 signed by the taxpayer, the case manager and the appropriate LB&I territory manager before the case manager emails it to Appeals. In SB/SE the territory manager’s signature is not required.