IRS Fast Track Settlement

What SB/SE Fast Track Settlement is

Fast Track Settlement (FTS) is mediation offered by the IRS Independent Office of Appeals while your audit is still open with the examiner. For small business and self-employed (SB/SE) audits it was formally established by Rev. Proc. 2017-25, which says it lets taxpayers with “unagreed issues in at least one open year under examination” work with the examiner and Appeals “while the case is still in SB/SE jurisdiction.”

• The mediator. “An Appeals Officer trained in mediation” acts as a neutral party. The mediator first helps you and the examiner find agreement, and if that fails, may propose a settlement “based on an assessment of the hazards of litigation” (IRM 8.26.2.9.1).
• Speed. The stated goal is for the whole process to be completed within 60 days after the case is accepted.
• No loss of rights. Neither side has to accept the mediator’s proposal, you can withdraw at any time, and if issues remain unresolved you keep your normal appeal rights (Publication 3498).
• Less paperwork. Publication 5022 (Rev. 9-2021) lists “no need for a formal protest” and a one-page application among the advantages.

Our page on whether to agree or appeal introduces FTS as one choice among several. This page covers who qualifies, how to apply, what happens in the session and what happens if it fails.

Who can use it, and who can't

Rev. Proc. 2017-25 makes FTS available for cases in SB/SE jurisdiction that have disputed factual or legal issues, where the issues are fully developed and remain unresolved after the examiner’s group manager has been involved. The IRS manual says it is available “with no regard to dollar amount” (IRM 8.26.2.5). An issue isn’t fully developed until every needed referral, technical or Counsel advice and valuation report is in.

The main exclusions, from section 4.02 of the revenue procedure:

Under the 2017 rules, one ineligible issue made the whole case ineligible. The current pilot (below) lets FTS cover the eligible issues anyway. Being turned down is final: “The decision not to accept a case into the SB/SE FTS program is not subject to administrative appeal or judicial review,” though you still have your regular appeal rights under the 30-day letter. Large business, international and tax-exempt cases have their own FTS programs.

The 2025-2027 pilot changes

• Issue by issue. FTS “can be applied to one or more issues in a case,” even if another issue is ineligible.
• No required manager conference first. The pilot “removes the pre-FTS managerial conference requirements” for SB/SE taxpayers. Publication 5022, written before the pilot, still says FTS is not offered until after a group manager’s conference.
• Denials need an executive. Requests “will not be denied without the approval of a first-line executive,” and a formal denial comes with an explanation.
• Mediation still available later. Participating in FTS no longer disqualifies you from Post-Appeals Mediation.
• Last Chance FTS. In select SB/SE cases, when you protest a 30-day letter the group manager asks Appeals to contact you about FTS before the case moves to Appeals. If you decline, the case goes to Appeals as usual.

The IRS says it will evaluate the pilot after the two-year test and decide whether to discontinue, adjust or make the changes permanent. Check the IRS Fast Track page before relying on these rules after January 15, 2027.

When to ask for Fast Track

Timing matters because FTS only works while the case is still with the examiner.

• Field audits (at your home or business): ideally before the 30-day letter is issued (IRM 8.26.2.7).
• Office audits (at an IRS office): at the time you ask for an Appeals conference.
• Always before a notice of deficiency (the 90-day letter). After that, and certainly after a Tax Court petition, FTS is off the table.

Rev. Proc. 2017-25 says either you, the examiner or the group manager can suggest FTS, and it “can be initiated at any time after an issue is fully developed.” Both sides must agree to take part.

How to apply, step by step

1. Tell the examiner you want Fast Track. Raise it with the examiner or the examiner’s group manager once the disputed issues are fully developed, and before any notice of deficiency is issued.
2. Write your position. Give the examiner a brief written statement of the facts and your position on each disputed issue. It becomes part of the application package.
3. Complete Form 14017 with the examiner. You and the examiner fill in Form 14017, Application for Fast Track Settlement. You, your spouse on a joint return and any representative sign it; the form also lists everyone who will take part.
4. Check your power of attorney. If a representative signs for you, the Form 2848 must specifically authorize disclosure of your information to the other participants, and a copy goes with the application.
5. Wait for acceptance. The group manager reviews the package and sends it to Appeals. The Appeals team manager decides within 3 business days of receipt and assigns a mediator.
6. Prepare for the session. The Appeals mediator contacts you within 5 business days of assignment to plan the session. Bring the people who can make decisions.

The application package that goes to Appeals contains Form 14017, the examiner’s workpapers supporting the IRS position, and your written response (Rev. Proc. 2017-25, section 5.03). Publication 5022 says your response should be “brief, concise and soundly written,” and that you and the examiner “must have raised all issues and claims” and you must have “presented all documentation” before the application is submitted.

Signing Form 14017 also gives your consent under IRC 6103(c) for the IRS to share your tax information with the people listed as participants. Note that a standard Form 2848 does not by itself authorize that disclosure unless it is “specifically added in Section 5 of Part I of the form” (IRM 8.26.2.7).

What happens in the session

The mediator (the “FTS Appeals Official”) schedules the session at the local Appeals office or another neutral site agreed by both sides, and may hold joint meetings, separate meetings with each side, or both. You don’t need a representative, but if you have one, they need a Form 2848.

• The session report. The mediator uses Form 14000, Fast Track Session Report, to list each issue and the amount in dispute, record what happens, and record the result.
• Only the listed issues. Generally only issues in the session report are considered. If either side brings new information and it would push the case past the 60-day goal, the mediator may postpone or end the session; if it ends, you would have to reapply.
• Settlement proposals. The mediator can propose terms for any or all issues. “Neither party is obligated to accept the settlement proposal offered by the FTS Official” (IRM 8.26.2.10). If you accept a proposal and the group manager rejects it, the SB/SE territory manager must review that rejection.
• Who should attend. People with authority to decide. IRS guidance says that “all decision makers must participate” for the session to succeed.
• Confidentiality. Everything said in the session is confidential return information and dispute resolution communication. The ex parte rules don’t apply, because the mediator is not acting in a traditional Appeals role.

How it ends: settled, partly settled, or not

If you settle. You, the IRS and the mediator sign the session report, which records a good-faith intention to settle but is not itself binding: it “does not waive restrictions on assessment,” end any statute extension, or close the case. The settlement is then closed on an agreement form, such as Form 870-AD when it rests on the hazards of litigation, and a Form 906 closing agreement where appropriate (IRM 8.26.2.10). The tax is assessed and billed like any other agreed audit; see Form 870 and 870-AD. The settlement does not bind other years or issues unless a closing agreement says so.

If you don’t. The examiner closes the case as unagreed and you receive the usual 30-day letter rights. You can then protest to Appeals, and the manual says these cases “are assigned to a different Appeals Officer” than the mediator, who must destroy their session notes (IRM 8.26.2.13). The usual statute rule then applies: Appeals generally needs about 365 days left on the assessment statute, so you may be asked to sign a Form 872.

If you withdraw. You can leave at any time with written notice to Appeals and SB/SE. Withdrawing one issue withdraws all issues then under consideration.

Fast Track Settlement vs a regular appeal

FTS tends to suit a business owner in a field or office audit with one or two developed issues, records already in the examiner’s hands, and a real disagreement about how the law applies. It suits less well when you still need to gather evidence, or when the dispute is all-or-nothing and neither side will move. The full Appeals conference remains available either way.

Other Fast Track programs (pointers only)

The IRS Fast Track page lists separate programs; check which IRS office has your case:

• Large business and international (LB&I): FTS with a goal of 120 days from acceptance (Publication 4539, Rev. Proc. 2003-40).
• Tax-exempt and government entities (TE/GE): FTS with a 60-day goal (Publication 5092, Announcement 2012-34).
• Fast Track Mediation – Collection: a different program for disputes over offers in compromise and trust fund recovery penalties, started with Form 13369, with a 40-day goal (Publication 3605, Rev. Proc. 2016-57). It is not part of an audit appeal. For collection disputes see your rights in IRS collection.

Getting help: FTS needs no representative, and many owners can explain a factual issue themselves. A representative is useful for framing the hazards of litigation, keeping the 60-day schedule and checking the closing documents. Low Income Taxpayer Clinics help eligible taxpayers free or for a small fee, and the Taxpayer Advocate Service (877-777-4778 (IRS.gov, 2026)) helps with hardship. Global Gate Tax Relief’s team includes licensed tax attorneys, enrolled agents and CPAs; it offers a free consultation and, if it takes the case, a flat fee quoted upfront with no promised outcome. Request a free case review or call 1-877-800-8180.

Frequently asked questions

Keep reading in the IRS Audit Guide

• IRS Independent Office of AppealsHow Appeals works, independence and timelines.
• The Appeals conferenceThe regular appeal if Fast Track doesn't settle it.
• Agree or appeal?All your choices after an audit, side by side.
• Self-employed auditsWhat examiners check on Schedule C.
• Form 870 and Form 870-ADThe agreement forms used to close a settlement.