Blog by BR Accounting and Tax Service

Disagree with an IRS Audit Determination?

  • BR Accounting And Tax Service

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I hope you have managed to stay safe and well! We focus on resolving tax issues in Prince William County and throughout the lower Northern Virginia area.

Do you disagree with an IRS audit determination? If this is the case. You should seriously hink about appealing it the determination to the IRS’s Office of Appeals. The Office of Appeals is an independent office within the IRS, that is separate from the exam and collection divisions. As a general rule,taxpayers can request an appeal by submitting a written protest or statement, which in turn “lay out” the issues in dispute and the reasons for yourdisagreement.

Cases in Appeals last on average seven to eight months, starting from the date that the Office of Appeals receives the case until it’s resolved or closed. This time frame applies to cases received from the exam or collection division, that haven’t been petitioned to the U.S. Tax Court. Appeals has the authority to lower the tax owed, in order to settle the dispute. Appeals makes a determination, regarding the probable outcomes if the case were to end up in Tax Court, and can offer a settlement based on that calculation. Remember, not all disputes in Appeals end up meriting a compromise (per the chief of appeals). But enough do, to warrant a taxpayer at least considering appealing the audit determination, should they disagree with initial findings.

Note, the Biden administration wants IRS to increase its enforcement activities, and as such is proposing more money for the Revenue Service, specifically, for this purpose. The proposal would increase IRS’s enforcement budget by $900 million, with the intention that the extra funding would allow IRS to conduct more audits of wealthy individuals and large corporations. In 2019, IRS audited 2.4% of individuals reporting $1 mil+ of income on their returns, a steep decline from 8.36% in 2010.

If you feel as though you may be one of the taxpayers having trouble with staying or becoming compliant with your tax obligations, with the regulatory authorities, We can help!.

According to the Deputy Commissioner for Small Businesses for the IRS, this might be the worst time to try and “fool” the IRS and attempt avoid compliance. They just have too many tools at their disposal (his words). Feel free to contact us if you have any questions or need assistance with resolving your tax issues with the IRS, or a state or local authority.