How To Know When You Can Appeal An IRS Decision

Did you know that you have the power as an individual taxpayer to appeal almost any decision made by the IRS? In fact, you can appeal audit findings, penalties and interest, rejected offers-in-compromise, liens, seizures, garnishments and other collection actions. However, according to the IRS, “Appeals is not for you if: – Your only concern is that you cannot afford to pay the amount you owe. – The correspondence you received from the IRS was a bill and there was no mention of Appeals.” So in these two instances, an appeal would be a premature action to take. If you are concerned that you cannot afford to pay the tax you owe, there are channels to go through before you would begin the appeal process. For instance, you could work with a tax attorney and make your case to the IRS that your situation qualifies for one of these tax debt payment methods: – Non-Collectible Status – Offer-in-Compromise – Installment Payment Plan – Partial Payment Installment Agreement – Tax Bankruptcy If an Offer-in-Compromise is the path that is taken, if it is rejected (85% of all Offer-In-Compromise proposals were rejected in 2006 by the IRS) the decision can be appealed up to 30 days from the date of the rejection. Your chances for a winning an Offer-In-Compromise is increased with the involvement of a competent tax attorney. Since there is only a 15% success rate with the IRS in these cases, it’s important that the paperwork is prepared from the standpoint of what the IRS wants to see. In fact, a good tax attorney will know from the start if an Offer-In-Compromise is the direction that you should go, and will certainly know if an appeal to a rejection of an offer is worth pursuing. If you’re audited (which is happening with increasing frequency these days, especially for small business owners), you may disagree with the IRS findings. You have the right as a taxpayer to disagree with any or all of the IRS’ findings.