How to Write an Effective Letter of Appeal to the IRS in 7 Steps — Best Tips Here
Paying taxes is a responsibility you must take seriously, even though it may not be the most pleasant thing to think about. There will be times when you might encounter some issues, like when the Internal Revenue Service (IRS) commits a mistake despite filing your taxes properly. These errors can range from misplaced documents to errors in filing. But don’t worry, you have the right to challenge the IRS’s decisions through a tax appeal.
Understandably, it can be stressful to deal with tax-related mistakes, especially major ones. However, the IRS is aware that this can happen, which is why it has set up a system where taxpayers can address the error through the IRS Office of Appeals.
So, what should you do if this issue arises? What rights do expat taxpayers have? And can you challenge the IRS’s position?
Expat Taxpayers Have a Right to Challenge the IRS’s Position
The IRS Office of Appeals acts independently from the IRS Examination and Collection. Their goal is to resolve tax issues between you and the government on a fair basis, without litigation, and in such a manner that enhances your voluntary compliance.
The appeal process is less formal and less costly, making it a worthwhile alternative to going to court.
However, before filing an appeal, it is essential to understand the Taxpayer Bill of Rights, as this will inform you of your entitlements. Among the 10 rights in the bill, numbers 4 and 5 are crucial.
The 4th right is “The Right to Challenge the IRS’s Position and Be Heard.” It states that taxpayers have the right to object and provide supporting documentation to respond to formal IRS actions. You can expect the IRS to consider your objections and documents fairly and provide a response if they disagree with your appeal.
The 5th right is “The Right to Appeal an IRS Decision in an Independent Forum.” As a taxpayer, you are entitled to a fair and impartial appeal that involves penalties. You also have the right to receive a written response regarding the Office of Appeals’ decision. Lastly, you can take the case to tax court if you wish.
Steps to Write an Effective Letter of Appeal to the IRS
After familiarizing yourself with the Taxpayer Bill of Rights, the next step is writing your appeal. You may be unsure of where to start, so here is a guide on how to write an effective letter of appeal to the IRS.
1. Do not sign the copy of the IRS report you disagree with
The first step in the IRS appeal process is not to immediately sign and return your copy of the report. You have 30 days from the date of the letter to file a written protest that explains why you disagree with the IRS’s decision.
2. Write a formal protest letter that includes all relevant details
Like with any letter, including all the relevant details is necessary. Having all the details will provide the IRS with a better understanding of the situation. You should explain why you disagree with the IRS’s tax audit findings but remember to use a professional tone.
According to the IRS, your letter should include the following:
- Taxpayer’s name, address, and contact information
- A statement expressing your desire to appeal the IRS’s findings to the Office of Appeals
- The tax period in question
- A list of the items you do not agree with and the corresponding reasons
- Facts supporting your position
- Any law or authority relevant to your appeal
3. Use facts and legal arguments to explain each item you disagree with
Since the appeal involves a serious matter, legal arguments will play a vital role in establishing your case.
It’s in your best interest to establish credibility by opening the protest with a concession of agreed-upon issues. Your protest should highlight the contested issues and support these with facts. Include supporting documents that the IRS can refer to. Your goal is to win on paper, so generously present facts to support your legal arguments.
4. Keep it short and simple
Letters that are too long can easily lose the reader’s interest. This applies to almost every letter, but since this involves the government, crafting a detailed yet concise letter is crucial. A letter of appeal is more effective when it’s written concisely and contains complete information that can help the IRS gauge the validity of your protest.
5. Organize your arguments in a logical and readable manner
Following an organized, logical flow in your letter of appeal makes it easier to read and helps the Office of Appeals personnel understand your case more quickly.
6. End with a penalty of perjury statement
A penalty of perjury statement is also called a sworn declaration. This statement recites facts of a legal proceeding. It resembles an affidavit but is not witnessed and sealed by an official.
The statement should read: “Under the penalties of perjury, I declare that the facts stated in this protest and any accompanying documents are true, correct, and complete to the best of my knowledge and belief.”
Don’t forget to affix your signature under the penalties of perjury statement.
7. Proofread your letter
This is the final step in any writing process. It’s necessary to read the contents one more time to ensure that you have included all pertinent details that will help strengthen your appeal. Last but not least, your grammar and vocabulary must be on point, so it’s best to do some edits to improve the clarity of your message.
FAQs About IRS Appeal Letters
Where do I send my appeal letter, and can I email it from abroad?
Send your protest to the mailing address or fax number shown on the IRS notice, as email isn’t accepted. Use a trackable method (e.g., certified mail or an international courier) and retain copies of all documents. Include your notice number on every page so it’s routed correctly.
What if I miss the 30-day window on the IRS letter?
Act quickly. Call the number on the notice to ask if Appeals can still review your case. If not, you may request audit reconsideration or address the issue in a later Collection Due Process (CDP) request if applicable. Keep proof of when you received the notice, especially with international mail delays.
Does filing an appeal stop IRS collections or new penalties?
A timely appeal on a proposed assessment generally pauses assessment and most collection actions, but interest usually keeps running. If you’re already in collections, request a CDP hearing by the deadline on the notice to put most actions on hold. Keep making voluntary payments if cash flow allows to limit interest.
Do I need a representative, and which form should I use (Form 2848 vs. Form 8821)?
Use Form 2848 (Power of Attorney) if you want a CPA, EA, or attorney to speak and negotiate with the IRS for you. Use Form 8821 if you only want someone to receive your IRS records and notices. Many expats choose 2848 so a pro can handle calls across time zones.
Will an appeal pause IRS collections and penalties?
Collection activity on the disputed amount is generally put on hold while the Appeals reviews your case. Interest still accrues, and some penalties may continue until the balance is fully paid. Request a collection hold if any payments continue while your appeal is active.
What evidence helps most in an expat appeal?
Third-party records carry weight, such as foreign payslips, bank statements, residency certificates, and local tax assessments. Tie each document to a specific item under dispute so the officer can follow your story quickly. Clear timelines and currency conversions make your facts easy to verify.
The Right to Fight
Tax-related issues are never fun. They can be challenging to deal with, but you must take action to correct wrongful findings on your tax return. Fortunately, the IRS has an appeal process in place.
Tax Samaritan is one of the premier tax resolution companies that has been providing professional-quality tax resolution services to expats since 1997. To learn more, visit the website and get a free tax quote today!
