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Understanding the IRS tax audit decision and appeals process

On Behalf of | Jan 2, 2024 | Tax Law |

Every business owner knows the importance of complying with tax regulations to avoid any potential legal consequences.

However, sometimes, despite their best efforts, businesses may find themselves facing an IRS tax audit. If the audit results in an unfavorable decision, it is important to understand that the journey does not necessarily end there. In certain circumstances, businesses have the option to appeal the IRS tax audit decision.

Grounds for appeal

Businesses can appeal an IRS tax audit decision if they believe there was an error in the audit process or if they have additional documentation that could impact the outcome. The grounds for appeal generally revolve around factual disputes, legal issues or procedural errors.

Requesting an appeal

The first step in appealing an IRS tax audit decision is to submit a written protest. The protest should clearly outline the reasons for the appeal, providing specific details and supporting documentation. Businesses must adhere to the deadlines specified in the IRS decision letter.

Conference with the appeals office

Upon receiving the written protest, the IRS will forward the case to the Appeals Office. It will schedule a conference with an appeals officer to discuss the issues raised in the appeal. This conference allows businesses to present their case, provide additional evidence and address any concerns or questions raised by the appeals officer.

Final resolution

Following the conference or mediation, the appeals officer will issue a determination letter outlining the final resolution of the case. This letter will provide a clear explanation of the decision and any further steps the business needs to take.

During FY 2022, the IRS completed 708,309 tax return audits. While facing an IRS tax audit may be challenging, businesses have the option to appeal an unfavorable decision.

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