San Mateo, CA: What if you get audited (or a notice in the mail) and the IRS never even considered your side of the story?
It happens--whether it be from a "jerk" of an IRS auditor or simply the IRS never responded to your letter explaining why you think you are right. You are summarily ignored.
Time passes--you think you might be OK, then suddenly, another notice appears (maybe a certified letter) telling you that you owe the tax due.
Are you stuck with the bill---having been ignored by the IRS?
NO!
Two common ways to challenge a tax that was assessed against you is by Audit Reconsideration or an Offer in Compromise-Doubt as to Liability. These methods of challenging the tax assessment give you a change to be heard; even after you were ignored.
The IRS likely won't tell you about these challenge opportunities in their letter so knowing that an assessment may not be final is a key concept.
Each of these challenge methods have their requirements---with good things and bad things attached to each method. For example, if the IRS has taken some of your refunds or levied your account to satisfy the tax bill, then it might be better to file an Audit Reconsideration because if you are successful, the money they wrongly took would be refunded. An Offer in Compromise-Doubt as to Liability might be best if you are being threatened with collection activity. Filing an offer suspends collections while you attempt to work through the process--an Audit Reconsideration does not freeze collections.
If you feel your tax bill after an IRS audit or notice is not justified, contact a tax professional familiar with IRS collections to take a look at your case. It may be that challenging the underlying assessment is the best way to get to the right answer!
Kevin Rego
650-933-5222
Disclaimer: The information provided is intended to provide a general overview of the topic presented. It is not intended to be a legal interpretation of your individual tax or legal situation. If there is a conflict between the information provided and any legal authority implementing or interpreting the topic, the legal authority shall prevail. Always seek legal advice from a licensed attorney. This article does not in any way establish an attorney-client relationship. That relationship can only be accomplished with both parties signing a mutual, written agreement.
