On October 26, 2022, the Internal Revenue Service issued Resolution number NAC-DGERCGC22-00000053, which contains several provisions on transactional agreements with the Internal Revenue Service (from now on referred to as the “IRS”) in tax matters. This resolution mainly establishes the following:
Alternative dispute resolution methods: regarding tax transactions, mediation is the only and exclusive way to settle them, according to the provisions of the Tax Code.
Exclusion of tax transaction: it is not possible to settle or reach agreements in a mediation process on disputes related to the following assumptions:
Debts arising from unpaid or undeclared tax returns.
Obligations relating to taxes that were effectively withheld or collected by the taxpayer but not delivered to the IRS promptly.
Claims seeking total or partial annulment of regulations, ordinances, and resolutions, among others, issued by the IRS.
Tax obligations that are under control and are subject to persuasive measures, and for which no communication of differences or draft minutes have been notified. The settlement of differences process is considered a tax determination process.
Concessions in tax matters: the following elements are not susceptible to settlement in tax transactions:
An abstract interpretation of legal provisions.
Facts whose accreditation in the administrative or judicial procedure is specific due to the existence of direct evidence.
Facts that are not directly related to the determination of the tax obligation that is the subject of the mediation process or its collection.
Interest waiver or interest rate reduction: the IRS may waive interest or reduce the interest rate according to the cost-benefit report issued for this purpose in the following cases: i) tax obligations that are under determination process; and ii) tax obligations contained in administrative acts, before or after they have become final or enforceable.
If the coercive process has been initiated, the IRS may waive up to 100% of the interest or reduce the interest rate, provided that the obligation is considered challenging to collect and the taxpayer expresses their willingness to pay the total capital amount immediately.
Rejection of mediation request: the IRS may reject participating in the mediation process, as this is a voluntary procedure for conflict resolution and/or if the object to be mediated is excluded from the scope of the transaction. The IRS has 30 days to express its decision (from the date of notification of the mediation request). In the case of interprocess transactions, the deadline mentioned above does not apply, and the competent judicial authority will determine the terms.
Agreement period: although the IRS may grant the taxpayer a period of 24 months, in monthly, quarterly, or semi-annual instalments, to fulfil the obligation payment, provided that the first instalment is equal to 20% of the tax obligation balance, the periodicity of the referred dividends will not apply to payment facilities requested by the taxpayer within a tax mediation process.
