Examination Appeals – An Effective Way To Resolve Your Tax Dispute

Examination Appeals

Examination Appeals – The Mission Of IRS Appeals

Did you receive an unfavorable adjustment during your IRS tax audit?

The IRS Office of Appeals helps over 100,000 taxpayers resolve their tax disputes without going to Tax Court. They are an independent organization within the IRS whose mission is to help taxpayers and the Government resolve tax disagreements. Appeals does not seek to take sides in a dispute; rather they offer an objective point of view on each individual case. They review each case after the applicable IRS compliance (i.e. examiner or auditor) has made its decision and work to resolve disagreements in the case on a basis that is fair and impartial to both the Government and the taxpayer.

Today, alternative dispute resolution, such as examination appeals, is widely valued and applied in many areas of our society. At Tax Samaritan, we can assist you with dispute resolution options, including examination appeals. The IRS Office of Appeals can overturn (or at least modify) the findings of your original audit in your favor.

The IRS Appeals Office

The IRS understands that many taxpayers will not agree with the findings of its auditors and examiners. Therefore, it has created a separate branch of service called the Office of Appeals, which consists of approximately 2,000 employees located nationwide. Most of them were auditors themselves. Appeals officers are senior employee within the IRS, and they usually have extensive legal and tax experience. Their sole function is to review examination reports, your appeals protest and provide an impartial platform for taxpayers to plead their cases to a higher power within the IRS. They attempt to avoid litigation by resolving tax disputes internally in a way that promotes future voluntary taxpayer compliance with the tax laws.

Examination appeals officers have greater authority and flexibility in deciding cases than auditors. Their competence is in fact judged by how often they are able to reach a successful compromise with taxpayers – not by their willingness to back an auditor’s findings. The Office of Appeals will listen to any reason why you disagree with an audit other than religious, moral or political beliefs.

Advantage Of Examination Appeals

An examination appeal can reduce (or even eliminate) previously assessed taxes and penalties. However, according to some studies, as few as 10% of taxpayers appeal their audits. Why this percentage is so low is something of a mystery, given the possibility to reach a fair and impartial outcome.

How To Start An Examination Appeal

Upon the completion of your audit, you will receive a detailed examination report from the IRS outlining all proposed assessments and changes, broken down by interest, penalties and taxes.

The first step in the examination appeals process is simply not to sign and return your copy of this report, which usually results in the generation of a 30-Day Letter that explains how to appeal the audit. You must file your official protest within 30 days of the date listed on the letter. Unfortunately, the IRS provides minimal guidance to taxpayers regarding the preparation of a written protest. However, they do provide some of the following basic requirements:

  • A statement that the taxpayer wants to appeal the IRS findings to the Appeals Office
  • A copy of the letter showing the proposed changes and findings the taxpayer doesn’t agree with, and why the taxpayer doesn’t agree
  • The facts supporting the taxpayer’s position on any issue that the taxpayer does not agree with
  • The law or authority on which the taxpayer is relying

The statement of facts should tell your story. It is integral that your story includes facts, not opinions that will result in a favorable outlook for examination appeals. As your representative, we have a strategic advantage over both you, the taxpayer, and the Appeals officer. The appeals officer is dependent on information from the audit examiner, whereas we can do a more detailed analysis of the facts of your case and an appropriate presentation (which is often lacking from appeals prepared by a taxpayer, simply because of inexperience and lack of knowledge about the tax law).

At Tax Samaritan, we have strong investigative skills so that we can get to the facts of your examination appeals case and provide a high quality statement of facts in your appeals protest. It is important to remember that facts, not opinions, represent the ingredients of successful examination appeals.

The examination appeals process can be quote lengthy, as long as 18 months depending on the backlog in the Office of Appeals, and truly can be a trial in patience. With Tax Samaritan as your representative, we are committed to the following:

  • Provide a statement listing all issues with which we disagree, explaining the facts and the law as we understand them, and why we disagree with the IRS position
  • Provide any additional information and/or documentation that will further your case (we will request appropriate documentation from you)
  • Provide our opinion on how we think your case should be resolved

Click to learn more about the IRS Tax Appeal process.

Our goal at Tax Samaritan is to provide the best counsel, advocacy and personal service for our clients. We are not only tax preparation and representation experts, but strive to become valued business partners. Tax Samaritan is committed to understanding our client’s unique needs; every tax situation is different and requires a personal approach in providing realistic and effective solutions.

If you’ve received an IRS letter stating that your case qualifies to be reviewed by Appeals, please click the button below to request a Tax Resolution Quote today to get started with the preparation of your examination appeals.

Tax Samaritan is a team of Enrolled Agents with over 25 years of experience focusing on US tax preparation and representation. We maintain this tax blog where all articles are written by Enrolled Agents. Our main objective is to educate US taxpayers on their tax responsibilities and the selection of a tax professional. Our articles are also designed to help taxpayers looking to self prepare, providing specific tips and pitfalls to avoid.

When looking for a tax professional, choose carefully. We recommend that you hire a credentialed tax professional such as Tax Samaritan that is an Enrolled Agent (America’s Tax Experts). If you are a US taxpayer overseas, we further recommend that you seek a professional who is experienced in expat tax preparation, like Tax Samaritan (most tax professionals have limited to no experience with the unique tax issues of expat taxpayers).

Randall Brody is an enrolled agent, licensed by the US Department of the Treasury to represent taxpayers before the IRS for audits, collections and appeals. To attain the enrolled agent designation, candidates must demonstrate expertise in taxation, fulfill continuing education credits and adhere to a stringent code of ethics.

Every effort has been taken to provide the most accurate and honest analysis of the tax information provided in this blog. Please use your discretion before making any decisions based on the information provided. This blog is not intended to be a substitute for seeking professional tax advice based on your individual needs.

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