When dealing with IRS collection actions, it’s crucial to know your options for appealing or disputing those actions. One such option is a Collection Due Process (CDP) hearing. But what happens if you miss the 30-day deadline to request a CDP hearing? Fortunately, the IRS offers another option known as an “Equivalent Hearing.” Let’s explore what an Equivalent Hearing is, how it works, and how it can still provide valuable opportunities to resolve your tax issue.
Understanding the Equivalent Hearing
An Equivalent Hearing is similar to a CDP hearing but is available if you miss the 30-day deadline to request a CDP hearing. You can request an Equivalent Hearing within one year of receiving either a Final Notice of Intent to Levy or a Notice of Federal Tax Lien. Although an Equivalent Hearing doesn’t offer all the same protections as a CDP hearing, it still provides a formal process to appeal IRS collection actions.
Key Differences Between CDP and Equivalent Hearings
While an Equivalent Hearing closely resembles a CDP hearing, there are important distinctions:
- No Automatic Halt to Collection Actions: Unlike a CDP hearing, an Equivalent Hearing does not automatically stop IRS collection actions, such as levies or liens. The IRS can continue pursuing collection activities while your case is being reviewed.
- No Access to Tax Court: One of the biggest drawbacks of an Equivalent Hearing is that it doesn’t preserve your right to take the case to U.S. Tax Court if you disagree with the outcome. This limits your legal options if the decision doesn’t go in your favor.
- Timing: As mentioned earlier, you have 30 days to request a CDP hearing from the date of the IRS notice. For an Equivalent Hearing, you have up to one year to make the request. This extended window gives you more time if you initially missed the CDP deadline.
Why Request an Equivalent Hearing?
Even though an Equivalent Hearing lacks some of the protections of a CDP hearing, it’s still a valuable opportunity. You can present your case to an independent Appeals officer who will review the IRS’s proposed actions and consider any alternative resolutions you propose. You might be able to negotiate an installment agreement, Offer in Compromise, or Currently Not Collectible (CNC) status.
In addition, an Equivalent Hearing allows you to raise similar arguments that you would in a CDP hearing. You can dispute the validity of the IRS’s actions or demonstrate why their collection methods would cause financial hardship.
How to Request an Equivalent Hearing
To request an Equivalent Hearing, you must file Form 12153, the same form used for a CDP hearing. Be sure to indicate on the form that you request an Equivalent Hearing. After submitting the form, you’ll work with an Appeals officer to review your case, discuss your options, and possibly reach a resolution.
Final Thoughts
An Equivalent Hearing is a useful backup option if you miss the deadline for a CDP hearing. Although it doesn’t automatically stop collection actions or provide access to the Tax Court, it still allows you to challenge the IRS and propose alternative solutions. If you’ve received a notice and missed the 30-day window for a CDP hearing, don’t lose hope—an Equivalent Hearing can still be a valuable tool in resolving your tax issue.
