Individuals and businesses that have gone through an audit may decide they don’t agree with the result or decision made by the IRS, including increased tax liability. A taxpayer may file an IRS audit reconsideration request in some cases in hopes of getting the ruling reevaluated.
Here are a few things to keep in mind:
- Some decide to request an official audit reconsideration, wherein the IRS reevaluates a previous audit result, including a reversed tax credit or additional tax that has yet to be paid.
- Taxpayers usually make such requests when they disagree with the outcome of the audit.
- Taxpayers who do make such requests then need to provide information about the issue at hand that was not included or considered during the initial audit.
- They may also invoke this process if the IRS made an error in the audit or when a substitute for return (SFR) is contested.
How to Know if You’re Eligible for an IRS Audit Reconsideration
Not all taxpayers are eligible to request a reconsideration. They must have filed a tax return for the applicable year, for instance. Additional eligibility requirements include the following:
Tax Assessment Remains Unpaid
The result of the initial audit may have been an increased tax liability, which still must be unpaid when making the request, or the IRS must have issued a tax credit reversal that the taxpayer is disputing. Taxpayers who have already paid the new tax amount following an audit will need to file a formal tax return amendment instead.
Taxpayer Must Identify Adjustments
The request must include exactly what adjustments you are seeking from the IRS. The agency requires that you lay out everything clearly for them to consider the request.
Provide New Information
These requests also need to include supporting information about the case, and information must be new and related to the issue at hand.
The IRS Made an Error
Sometimes the IRS does make errors when processing audits, so this would be a legitimate reason for them to look at the audit result again. This could be a computational or processing error.
A taxpayer will typically file a request for an IRS audit reconsideration if they disagree with an increased tax liability, but the above requirements or circumstances are necessary for the request to move forward. Talk to a tax attorney so you know you have a legitimate reason to make this request.
3 Steps to File an IRS Audit Reconsideration Request
Taxpayers who disagree with an audit result or need to request a reevaluation can do so in a fairly straightforward, simple process. Follow these steps when you are ready to begin the reconsideration request:
1. Review the Audit
You will first need to review the original audit report and nail down exactly what you disagree with. Your case needs to be clear when you contact the IRS. Include specifics.
2. Gather Information
Gather all documents, records, and information that support your request for reconsideration. Outline what is new that you didn’t present previously.
3. Send Documents
You will need to make copies of all applicable documents and write a letter that explains your request. The IRS will not accept original documents, so always send copies. Other documents to include are Form 12661, Disputed Issue Verification, which explains the issues you are outlining, and Form 4549, which is your original examination report.
There are 10 U.S. IRS campuses where you should send the request via mail or fax, and they are listed on IRS Publication 3598. Talk to a tax professional for help preparing your submission.
What Happens After Your Request Is Submitted
The IRS will accept or deny the request, and usually sends their response within 30 days after you submit it. They should accept the request if the information you provided is new, if you filed a return after the IRS submitted a return for you, if they made a computational or processing mistake, or if the new tax liability is unpaid or credits were denied. The IRS will let you know if they have reduced your tax liability based on the information you provided or if they couldn’t make changes based on what you sent.
You can then pay the amount you owe or request an appeals conference if you disagree with their decision. You can send a check or money order to the address you receive on the IRS bill or pay by credit or debit card. You can also make any payment online or via phone to the U.S. Treasury. Note that sometimes credit card servicers charge a convenience fee, which they must disclose.
Contact Silver Tax Group With Questions
IRS audits can be complex and confusing, especially if you think a result was incorrect, for whatever reason. Consider talking about your audit reconsideration options with a tax professional who can walk you through your rights and obligations. The team of experienced tax attorneys at Silver Tax Group can advise you on whether to pursue this course and help you prepare everything accurately and correctly to make the strongest case.
We successfully serve a nationwide list of clients, and that has prepared us to help you with any issue related to an IRS audit. Reach out to our team to speak with a tax expert who can help you get the ruling you’re looking for.
