On September 11, 2025, the IRS announced a two-year nationwide pilot program to test certain procedural changes to the Internal Revenue Service (IRS) Post Appeals Mediation (PAM) program in the IRS's Independent Office of Appeals. Under the pilot program, cases accepted into PAM will be reassigned to a new Appeals team for PAM proceedings. This pilot program is part of the IRS's broader emphasis on facilitating case resolution.

PAM gives taxpayers an opportunity to request to enter into non-binding mediation to get a second look at any unresolved issues that remain after an Appeals conference. All parties, including the Appeals team, must agree to enter into PAM. The mediator typically is another Appeals officer, although the taxpayer can bring in another mediator from outside the IRS. Typically, the Appeals team that participated in the underlying (and unsuccessful) settlement conference also represents Appeals in the mediation. 

Under the pilot program announced last month, the Appeals Alternative Dispute Resolution (ADR) Program Management Office will assign a new Appeals team with no connection to the underlying case to serve as the Appeals representatives during PAM. The new Appeals team will also handle any closing procedures following PAM, unless certain unresolved issues or procedural obligations must be transferred back (with management approval) to the original Appeals team. As before, the Appeals mediator cannot be chosen from the old or new Appeals teams. It remains to be seen the frequency with which Technical Specialists and/or IRS counsel who were involved in the case at Appeals are reassigned for PAM proceedings. Technical Specialists are not part of this pilot program, but "every effort" will be made to assign a new Specialist for PAM "whenever possible."

ADR programs, including PAM, serve as valuable tools for both tax planning and controversy resolution, and this pilot program is a positive development for taxpayers interested in participating in PAM. Assigning a new Appeals team to represent Appeals in PAM after a potentially contentious conference in the underlying case should bring an additional fresh perspective (along with the Appeals mediator and any outside mediator) to the case and hopefully improve the odds for a successful resolution. See here for our previous coverage of ADR programs. The pilot program is effective as of September 11, 2025, and will last for two years, at which point the IRS will determine whether to make permanent, adjust, or phase out these changes to the Appeals personnel reviewing and conducting PAM proceedings.

For more information, please contact:

George A. Hani, ghani@milchev.com, 202-626-5953

Samuel A. Lapin, slapin@milchev.com, 202-626-5807

Katherine Lewis, klewis@milchev.com, 202-626-5894

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