Usually, yes.
The IRS says you are entitled to a fair and impartial appeal of most of its decisions, and generally to take your case to court. IRS Publication 5, Your Appeal Rights.
When you disagree with an audit, the IRS first proposes changes. A bill comes later. IRS Publication 3498, The Examination Process. Before it does, there are two letters to watch for: the 30-day letter and the 90-day letter.
If you are not sure where you stand, book a free call. We read the letter and the audit report with you. It does not commit you to anything.
What this page covers
This page is about an audit of your income tax return. An audit of employment taxes follows different rules. IRS Publication 5.
If the tax has already been assessed and you are getting bills, your options are different. We cover those in I do not think I owe this. What can I do?
If you disagree with a lien, a levy or a seizure, the IRS points you to a separate guide, IRS Publication 1660, Collection Appeal Rights. The same goes for a payment plan the IRS turned down, changed or ended. IRS: Preparing a request for appeals.
Working out which of these applies is the first thing we do for clients, before anything is filed.
Is Appeals the right place for you?
The IRS says its Independent Office of Appeals may be the place for you if all of these are true. IRS: Considering an appeal.
- You got a letter from the IRS explaining your right to appeal its decision
- You do not agree with the decision
- You are not signing an agreement form the IRS sent you
The IRS also says Appeals is not for you if any of these is true.
- What you got was a bill, and it did not mention an appeal
- You did not give the examiner all the information that supports your side during the audit
- Your only concern is that you cannot afford to pay what you owe
If you are not sure which list your case is on, book a free call. We look at your letter with you, and if Appeals is not the right route, we say so early.
Start with the examiner, then their supervisor
Before you appeal, make sure the examiner has everything you want the IRS to consider. If you have not, contact the IRS employee named in your letter and send it within the time limit given.
New information at the Appeals stage may first have to go back to an IRS employee. The IRS says that will likely delay your case. IRS Publication 5.
If you cannot agree with the examiner, you can generally ask to talk with their supervisor. IRS Publication 5. That can be a meeting or a phone call. If you reach an agreement, the IRS closes your case. IRS Publication 3498.
When a client’s audit is still open, with their authorization we take this part over. They tell us what the examiner asked for. We go through the report item by item and get the records behind each one to the examiner while the file is still open.
Another option: Fast Track Settlement
Fast Track Settlement brings in a trained Appeals employee as a neutral party. Your case stays with the examiner. IRS Publication 5.
The IRS sets conditions.
- You and the IRS must both agree to take part
- The issues must be fully developed
- You must give a brief, well-reasoned written response to the IRS’s position
- There must be a limited number of issues that can be settled within the IRS’s 60-day goal
You can withdraw at any time. If any issues are left unsettled, you keep your usual appeal rights. IRS Publication 5.
To ask for it, tell the IRS employee handling your case. IRS Publication 5.
If Fast Track sounds like a fit, book a free call. We check your case against those conditions with you.
The 30-day letter
If you and the examiner do not agree, you get a letter known as a 30-day letter. It tells you about your right to appeal. You generally have 30 days from the date of the letter to accept the changes or appeal them. IRS Publication 3498.
The IRS uses several letters for this. Letter 525 and Letter 950 each say to file your protest within 30 days from the date of the letter. But not every letter gives 30 days. Letter 692 gives 15. IRS: Letters and notices offering an appeal opportunity. Go by the date and time limit on your own letter.
When a 30-day letter arrives, the first thing we do for clients is find the date the clock runs from. Then we handle the appeal from there.
Small case request or formal protest
To get an Appeals conference you have to ask in writing. Which kind of request depends on the amount, and sometimes on the kind of filer. IRS Publication 5.
When a small case request is enough
You may make a small case request if the total tax and penalties for each tax period in your letter is $25,000 or less. IRS Publication 5. The amount has to come from an examination, which is an audit. IRS: Preparing a request for appeals.
How the IRS counts it:
- Include the proposed increase or decrease in tax, with penalties
- Or include the refund you are claiming
- If more than one tax period is involved and any one is over $25,000, you must file a formal protest for all of them
Partnerships, S corporations, employee plans and exempt organizations must file a formal protest whatever the amount. IRS Publication 5.
A small case request can be a brief written statement. List the issues you disagree with and why. Or use the appeal form that came with your letter, if there was one, or Form 12203. IRS Publication 5.
What a formal protest has to include
- A statement that you want to appeal the changes the IRS proposed
- Your name, address and a daytime phone number
- Every issue you dispute, the tax periods, the proposed changes, and why you disagree with each issue
- The facts that support your side on each issue
- Any law or authority that supports you
- A signed penalties of perjury statement, in the words the IRS gives
IRS Publication 5. A representative who files it uses a different statement, also set out there.
Pulling a protest together is slow work. Book a free call and we walk through each issue with you.
Where to send it
Mail it to the IRS address on the letter that explains your appeal rights. Do not send it straight to Appeals. The IRS says that will only delay things, and it may stop Appeals from considering your case. IRS: Preparing a request for appeals.
The office that did the audit reads it first and tries to settle it with you. If it cannot, it sends your case on to Appeals. IRS: Preparing a request for appeals.
For our clients, we do the writing. They give us their records and tell us what happened. We sort everything by issue and by year, write the protest, and file it at the right address.
What happens at Appeals
Appeals is separate from the part of the IRS that proposed the changes. It is the only level of appeal inside the IRS. IRS Publication 5.
The conference is informal. It may be by phone, video or in person. If you bring new information that needs more analysis, Appeals will generally send the case back to the audit office to look at it first. IRS Publication 3498.
If your case is headed to an Appeals conference, book a free call. We explain how the conference runs.
A time limit you may be asked to extend
The IRS has a deadline to assess tax. Generally, Appeals needs at least 365 days left on it when your case arrives. If more time is needed, the IRS will ask you to extend it. If you do not extend it, Appeals will not consider your case. IRS Publication 3498.
You have the right to refuse, or to negotiate the terms. If you refuse, the IRS will take steps to assess the tax it decides is due. IRS Publication 3498.
For our clients, we go through an extension request before anything is signed. With their authorization, we deal with the IRS on it.
If the 30 days pass: the 90-day letter
If you do not respond to the 30-day letter, the IRS sends a 90-day letter. This is also called a notice of deficiency. It is a legal document that explains the proposed changes and the amount. IRS Publication 3498. The IRS lists one version as Letter 531. IRS: Letters and notices offering an appeal opportunity.
You then have 90 days from the date of the notice to file a petition with the U.S. Tax Court. It is 150 days if the notice is addressed to someone outside the United States. If you do not petition, you get a bill. IRS Publication 3498. The notice usually shows the last day to file. Go by that date. U.S. Tax Court: Starting a case.
About that window:
- The law sets it. You cannot get an extension of time to file
- Talking to the examiner or Appeals does not extend it
- You can generally file before paying the tax in full
IRS Publication 5. U.S. Tax Court: Starting a case.
Interest generally runs on any tax you end up owing, from its original due date until it is paid. The filing fee is $60. The court may waive it if you show the court you cannot pay. U.S. Tax Court: Starting a case.
If you file in time and did not appeal inside the IRS before, you will normally get a chance to settle with Appeals while you wait for trial. IRS Publication 5. So missing the 30-day letter does not always mean losing your chance at Appeals.
And if you did go to Appeals and did not settle, you can still go to court if you receive a notice of deficiency. IRS Publication 3498.
If a notice of deficiency has arrived, book a free call. We check the date with you and say plainly whether there is still time. If there is not, we would rather you heard it from us on day one.
Who can represent you
You can represent yourself at Appeals. Or you can have a professional do it. The IRS says your representative must be one of these. IRS: Preparing a request for appeals.
- An attorney
- A certified public accountant
- An enrolled agent authorized to practice before the IRS
Other people who may serve are set out in IRS Publication 947.
On our team, Abby Fernandez, JD, is an attorney admitted to the Ohio Bar and the U.S. Tax Court.
If you want your representative to take part without you, the IRS needs a completed power of attorney first, such as Form 2848. IRS Publication 5.
If you cannot afford help, a Low Income Taxpayer Clinic may be able to represent you if you qualify. Clinics are independent of the IRS. The list is in IRS Publication 4134. IRS Publication 5.
If a clinic fits, use it. If you would rather we took it on, we represent you before the IRS with your authorization. The same small team stays on your case from the first call to the last.
What to gather
- The 30-day letter or notice of deficiency, with its date
- The report or explanation of changes that came with it
- Your records for each item the IRS changed
- A note of what you already sent the examiner, and when
Bring what you have to a free call. We line it up with you against each change in the report.
Where this leaves you
You can usually appeal an audit before the IRS sends a bill. Answer the 30-day letter in writing, on time, at the address on the letter. If the 30 days pass, the 90-day letter still gives you a route to Tax Court.
If you want a second pair of eyes on the letter, IRS Help offers a free 30-minute consultation. Bring the letter. There is no pressure, and we read your IRS records before anyone commits to anything. You can reach us through the contact page.
This article is general information about federal tax procedure. It is not legal or tax advice about your situation. Your rights and deadlines depend on the letter you received and your own facts.
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