New Twist to IRS Tax Appeal Process

Earlier this week, the IRS announced that its Office of Appeals would begin to pilot a new video conference option for resolving an IRS tax appeal. With over 100,000 taxpayers filing tax appeals each year, the agency is hoping that this new program will reduce response time as well as help to lighten the work load of IRS employees who are operating with reduced resources. Prior to the initiation of this new web-based alternative, a taxpayer or their representative would have to travel to an IRS office in order to have a face-to-face meeting with an IRS appeals representative. The only other option was to discuss the matter by phone which often did not result in a satisfactory resolution of the matter at hand.

An IRS tax appeal is most often initiated when a business or individual taxpayer disagrees with a determination made by the IRS as the result of an IRS tax audit. At the end of the audit process, the IRS sends the audited entity a copy of the auditor’s ruling together with a formal written letter outlining the specific steps necessary to appeal the results. The letter states that, in order to be considered, a written appeal must be submitted within 30 days of the date shown on the communication from the IRS. It must include a specific lists of the items for which there is disagreement, the reason for the disagreement and any facts or laws that support the taxpayer’s position. Once this statement is submitted together with a signed perjury statement, the IRS may take up to 90 days to respond.

If the written request for appeal is accepted, an appeal hearing is scheduled. To prepare, the business or individual being audited should submit a Federal Freedom of Information Act letter requesting the full auditor’s report and follow this up by collecting and organizing documentation to support each item being questioned. Prior to the recent IRS video conferencing initiative, these appeal hearings were conducted in one of two ways - over the phone with supporting documentation submitted by mail or face-to-face at an IRS office. Both of these previous alternatives are accompanied by logistical shortcomings which will hopefully be resolved with the new web-based solution.

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