Five Expert Tips for Navigating the Tax Dispute Appeals Process and Coming Out on Top

Five Expert Tips for Navigating the Tax Dispute Appeals Process

The IRS says you have unpaid taxes. You think they’re wrong, but despite your efforts to explain to them why they’re incorrect, they refuse to budge. Now you just received a notice from the IRS saying they’re going to try and collect money from you. Is there any way to formally dispute this tax bill? Yes, and one way to do so is to file an appeal. Here are some tips to increase your chances of success.

Tip #1: Double Check the Information Provided to the IRS

The best way to limit the complexity and uncertainty of an IRS appeal is to avoid having to file an appeal in the first place. One way you can do this is by making sure that you’ve provided the IRS with all of the requested information. 

There’s little point in appealing an IRS determination when the appeals officer will ask you to provide the information the IRS requested earlier, but you refused or were unable to provide. And don’t ignore the possibility that providing the missing information could resolve your tax dispute and avoid any negative impact on the reputation of yourself or your organization.

Tip #2: File Your Appeal on Time

The right to file an appeal usually arises when the IRS sends you a letter or notice explaining the IRS’ decision. This letter will mention your right to appeal the IRS’ decision and explain how to begin the appeal process. This includes telling you how much time you have to file your appeal as either a small case request or a formal written protest. Generally, you’ll have 30 days from the date of this letter or notice to file your appeal. 

If you can’t file your appeal on time, it’s possible to ask for a 30 or 60-day extension. The IRS is usually fairly lenient with granting these extensions. But if you wait until this deadline passes to file your appeal or ask for an extension, your right to appeal this particular tax dispute will typically be gone.

Tip #3: Be Willing to Negotiate 

Your appeals case will be decided by an appeals officer. This will not be the same person who was involved in the decision that led to the appeal, such as an audit or determination of tax liability. 

The appeals officer will likely have greater more flexibility to resolve a tax issue than the IRS auditor or other IRS representative that made the original decision. The primary goal of the appeals officer is to resolve your tax appeal as quickly and efficiently as possible, not necessarily to get the most money from you. As a result, they’re usually willing to negotiate a settlement with you. 

Being open to negotiations means you can sometimes resolve your tax disagreement in a time and cost-effective manner, while also modestly reducing your IRS tax liability.

Tip #4: Ask the IRS for Information About Your Case

If your appeal relates to an audit, the Freedom of Information Act allows you to obtain a copy of the auditor’s file. This file will contain valuable information as to the IRS’ legal position which you can use to craft your arguments during the appeal.

Tip #5: Consider Hiring a Tax Lawyer to Handle Your Case

You can choose to represent yourself when submitting an appeal to the IRS, but it’s recommended that you hire a tax professional to represent you. After all, you probably tried resolving the tax disagreement on your own, but it didn’t work and that’s why you’re considering an appeal.

If you hire someone to represent you for the appeal, they must be an attorney, certified public accountant or an enrolled agent that’s authorized to practice before the IRS. But for many tax appeals, hiring a tax attorney is the best option as they usually have a better understanding of complex and nuanced tax issues.

Kienitz Tax Law is here to help you with your tax issues. Schedule your FREE consultation today!

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