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How to Write an Effective Letter of Appeal to the IRS in 7 Steps

APPEAL with a judge's gavel and scales of justice in the background

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 and filing errors.

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 they have set up a system where taxpayers can address the error via 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

You read it right—you do have the right to challenge the IRS’s decision through an appeal.

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, so this is a route that is worth considering than going to court.

However, before filing an appeal, you should understand the Taxpayer Bill of Rights so you know what you are entitled to. 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 the objections and documents fairly and receive a response should 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 a 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 to not 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 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 containing complete information 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 can help the Office of Appeals personnel in understanding your case 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 will have to be on-point, so it’s best to do some edits to improve the clarity of your message.

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 have been providing professional-quality tax resolution services to expats since 1997. To learn more, visit the website and get a free tax quote today!

All About Randall Brody
Randall is the Founder of Tax Samaritan, a boutique firm specializing in the preparation of taxes and the resolution of tax problems for Americans living abroad, as well as the other unique tax issues that apply to taxpayers. Here, they help taxpayers save money on their tax returns.

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