IRS Appeals and Tax Litigation

As described under IRS Audits, if a taxpayer does not agree with the audit results, either partially or entirely, the taxpayer usually has a right to appeal the audit determination to the IRS Appeals Office, which is an independent office within IRS. Over many years of experience, we have found that while the Appeals Office is still a part of IRS, it makes a good faith effort to resolve disputes with taxpayers. One of the benefits of dealing with the Appeals Office is that an appeals officer, unlike an auditor, is authorized to consider the hazards of litigation in determining whether the case should be settled.

If a taxpayer does not agree with the audit results, the auditor will issue what is known as a 30 Day Letter. Essentially, the 30 Day Letter includes a copy of the audit report and states that the taxpayer has the right to file an appeal within 30 days. It is possible, in most cases, to obtain an extension of the 30 day period. However, it is critical that the appeal, commonly known as a Protest, be filed with the proper IRS representative within the 30 day period or any granted extension. An appeals officer will subsequently contact the taxpayer or his representative, and an appeals conference will be scheduled. In some cases, the appeals conference can be handled by telephone, but in most cases in which we are involved we meet face-to-face with an appeals officer.

In many respects, the filing of a Protest is similar to the filing of a legal brief in court, although it is less formal. Over many years of practice, we have found the best approach is to prepare a thorough and complete Protest, addressing the facts and circumstances, the applicable law and regulations and the applicable court decisions. In the vast majority of cases, it has been our experience that a satisfactory resolution can be reached with the appeals officer, thereby avoiding expensive litigation.

However, if an agreement cannot be reached with the appeals officer, the taxpayer will have the right to challenge the IRS determination before the United States Tax Court, Federal District Court or the Court of Federal Claims. IRS will issue a statutory notice of deficiency, sometimes called a 90 Day Letter, which provides the taxpayer the opportunity to file a petition in United States Tax Court within 90 days; most taxpayers prefer to litigate tax cases before the United States Tax Court, since it is the only court that does not require that the disputed tax be paid in advance. However, the petition must be filed within the 90 day period, as there is no possibility of extension.

 

 

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Who we are
Robert R. HendryRobert R. Hendry received both a Bachelor of Arts degree and a Juris Doctor degree from the University of Florida. Although he began his career in Pensacola, Florida, Mr. Hendry has practiced law in Orlando for more than thirty years.
Richard D. StonerRichard D. Stoner received a Bachelor of Arts degree from New York University and a Juris Doctor degree from Stetson University College of Law. He has practiced law in Orlando, Florida for more than twenty-five years.
G. Steven BrownG. Steven Brown is a 1975 graduate of the University of Central Florida, where he received a Bachelor of Science in Business Administration degree with a major in Accountancy.
Law for FloridaHendry, Stoner & Brown, P.A. traces its roots back to 1970, when Robert Hendry and Richard Stoner were principals together in a predecessor law firm. Our attorneys are committed to giving clients the legal edge they need to succeed and prosper.