Disagree With IRS Audit Results? 4 Steps To Appeal It

If the IRS has audited your return, what happens if you disagree with the auditor's findings? Do you have any recourse to argue your case? Or is this the end of the line where you must simply accept what you feel is wrong? 

The truth is that the IRS provides a variety of means by which a taxpayer can appeal the results of an audit to higher authorities. What are these means? Here are four steps you can take.

The Office of Appeals. If you have a legitimate complaint about the audit's application of tax law, you may file a request for an appeal with the independent Office of Appeals. Instructions for requesting an appeal and the timeline for doing so are in the "30-day notice" you would have received if the audit changed your balance due or refund. A tax services provider such as an enrolled agent, CPA, or tax attorney can represent you before an appeals officer.

Mediation. Mediation is a legal process wherein an objective third party brings the two sides together and attempts to reach an equitable agreement. Mediation is one method the IRS offers to resolve an audit disagreement without taking things further in the court system. If you wish to negotiate the amount due or collections actions, for instance, this is a quick and simple way to do so. 

Tax Court. If the appeals officer and the taxpayer continue to disagree about the findings, you may file a petition in the United States Tax Court. Tax Court has a small case division (changes up to $50,000) and also a division for larger cases. The Tax Court will issue a ruling based on a judge's determination, rather than a jury of peers. Small cases generally are not able to be appealed to any other court.

Federal Court. What if you want to have a trial by jury? Then you may want to file a petition with the U.S. District Court or U.S. Court of Federal Claims. These federal courts hear a variety of cases beyond taxes, and you may feel that this could net you a more favorable result. To choose these options, you generally need to have paid the additional tax due and had the IRS reject your appeal claim. 

No matter which route you wish to take in order to get satisfactory results from the examination of your tax returns, be sure you have experienced tax professionals on your side. Doing so could be the difference between a big refund and a big tax bill. For more information, contact a company like Balkcom Pearsall & Parrish CPA's PA today.