What You Need to Know About the Tax Appeal Process

If you’ve been audited recently and were not pleased with the results, then you should know that doesn’t have to be the final result. A tax appeal is generally available to any individual or business to dispute a result you are not happy with.

There are many reasons to file a tax appeal, but three of the most common relate to disputing the results of an audit, the collection methods used by tax authorities, or the imposition of certain penalties. With the IRS, you have the right to start a tax appeal with the IRS Independent Office of Appeals.

How to Start a Tax Appeal

If you’ve decided that you want to start a tax appeal, you request an appeal by filing a written protest and mailing it to the IRS. Be sure to use the same address that was included in the letter that explains your appeal rights.

When the total sum of additional tax and penalty for each tax period remains less than $25,000, you can fill out a Small Case Request instead of a protest.

In either circumstance, follow the directions in the letter that explains your appeal rights. You may represent yourself, or you may be represented by a tax attorney, CPA, or another enrolled agent who can practice before the IRS.

Challenges of the Tax Appeal Process

The tax appeal process is not straightforward. The protest must include the right documents and information to prevail in your case. Most importantly, it must be presented in the proper way to the tax agency.

The tax appeal protest must include the following information:

  • A statement that you want to appeal.
  • The disputed issues, proposed changes, and why you disagree with each issue.
  • Facts and documentation to support your position.
  • Any laws or authority that supports your position.
  • The penalty of perjury statement: “Under penalties of perjury, I declare to the best of my knowledge and belief, the information contained in this protest and accompanying documents is true, correct, and complete.”

Factors to Consider Before Starting a Tax Appeal

Before you start a tax appeal, you must consider timing and the available records and information. The letter from the taxing agency that explains your appeals rights will state the deadline to file the appeal. You must file the appeal well within the deadline set.

It’s important to gather written evidence to attach to the appeal – the tax agencies generally will not accept your written statement alone.  Start gathering relevant records, even if that means requesting records from a bank or other financial institution. If you’re unsure what documentation is needed for a successful appeal, consult a tax attorney.

Potential Outcomes of a Tax Appeal 

While starting a tax appeal can cost a significant amount of time and energy, it’s worth pursuing if you have a case worth fighting. Once a tax appeal is completed, taxes and penalties can be eliminated or significantly reduced.

If the appeal concerns a collection issue, then levies can be stopped, payment options can be negotiated, and liens can be delayed, withdrawn, or released.

The Benefits of a Tax Lawyer

While the IRS website does outline how to start a tax appeal on your own, it’s often difficult to navigate correctly. Failing to provide the right records and information to the taxing authorities can result in the rejection of the appeal. 

A tax lawyer understands the applicable law related to your appeal and will help you strengthen your case. Plus, they understand the procedures of specific tax agencies. If you try to do it yourself, your appeal could be ignored, rejected, or lost.

Need Help Starting Your Tax Appeal? Contact Mindy Meigs

If you want an Orange County tax lawyer with 15 years of experience as a trial attorney for the IRS Office of Chief Counsel, look no further than Mindy Meigs. She knows how to handle matters for federal and state tax agencies, and can help you determine if you should file an appeal and how to present it to the taxing authorities. If you’re considering starting an appeal, then contact Mindy Meigs for advice today.