The IRS and the IRS Appeals Department are separate bodies. If you dispute the results of an IRS audit you can instigate an IRSA administrative appeal against their decision in the Tax Court, or even settle the matter out of the court. The types of administrative appeals are the Collections Appeal Process and the Collections Due Process. You are entitled to representation by either an attorney or an accountant at either of these appeals, and the process can take place by mail, telephone or in person. There is more than one process for appeals depending on the amount in dispute.
The Appeal Processes
If the amount in dispute is less than $2,500, then you can enter into an appeal request directly with the auditor concerned. For disputes of more than $2,500 but less than $25,000 the request for appeal review goes through the Small Case Request system. You will have a form to complete (or we can help with that) and you can include a statement setting out what you dispute and why. For an amount more than $25,000 you will need to go down a more formal route called the Formal Written Protest, which is a much fuller process and requires more evidence. If you are being represented, then there is a declaration that should be signed by your representative.
The Collections Appeal Process
As you might expect, this is the quickest of all the appeals processes. If furniture, systems or devices have been seized in lieu of payment of IRS taxes, then you should ensure you file for this appeal prior to their being sold. The IRS has to wait 30 days for any appeal before they can dispose of the assets. If you owe additional taxes, this cannot be dealt with through the collections appeal process, but we can help you with that. There are more appeals that can be undertaken with this, and we can talk you through the whole process and list of appeals, once you contact us.
The Collection Of Due Process Appeal
With this appeal you can go through the Tax Courts to appeal the decision of the IRS audit. After receiving your audit findings, you have 30 days to submit your appeal request. This will prevent any assets or monies being collected by the IRS. If you do not manage to submit your appeal within the 30-days timeframe, you will still be able to appeal but your case will not be heard in the Tax Court. You will need to submit a different form to request an equivalent hearing. However, the IRSA are within their rights to seize assets as you are out of the 30-day timeframe.
What Happens Next?
A date for the hearing will be issued, which will usually be for about 60 days’ time. You will be able to use this time to gather evidence. A copy of the IRS auditor’s file has to be provided for your upon request, and this will allow you to scrutinize it and address any errors you identify. This may take up to a month to arrive, so do not wait until you have received it before starting to outline your actions.
The hearing is generally informal in nature and you can take notes. If you are represented your agent or attorney will undertake all the talking. It may be possible tom reach a verbal settlement during this hearing. If this is the case, you will receive notification in writing of it at a later date. You should satisfy yourself that it contains everything you agreed to before signing and returning it to the IRS.
We Can Help
Tax defense Partners have been helping ordinary people instigate appeals for more than 20 years. We have a combined expertise of 50 years between us and we have successfully appealed and won more than 1000 cases on behalf of our clients. Let us help. Contact us today.