Did you know the appeal of an IRS audit is based upon the IRS examination file record of the audit itself? When the IRS produces its “Notice of Determination” at the end of an audit, a very important door closes: the ability to put information onto “the record” to bolster the odds of a successful appeal.
If you are not satisfied with the results of an IRS audit, the next step in most situations is to appeal the results in the Notice of Determination. However, it is important to note any appeal is based entirely upon the record within the associated examination file. There is no opportunity to provide additional information for consideration at the appellate level. If any information relevant to the appeal isn’t in the record of the associated audit (the examination file), it will not be considered during the subsequent appeal.
Taxpayers often ask, “If information must be in the record for a successful appeal, isn’t providing more information during the audit a good thing?” No, not necessarily. Providing too much or wrong information simply opens the taxpayer to additional risk through a widened audit scope.
In many audit cases, a taxpayer’s practice in one tax year is a behavior that has been repeated in previous tax years. Providing more information than required to the IRS auditor also opens the door to expanding the audit scope into previous year’s tax returns. The information provided by your tax attorney, Janathan Allen, for “the record” is focused upon the specific issue or question of law that lies at the heart of the audit. The primary mission of our experienced tax attorneys is to achieve an effective outcome during the audit on behalf of our client.
If we are working with a challenging auditor, or if the audit is simply not adhering to US or state law, our tax attorney must work to ensure that the appropriate basis for an appellate argument is documented in the initial audit and recorded in the file. Once the Notice of Determination has been issued at the conclusion of an IRS audit, the information door closes. These are some of the reasons why having expert and experienced help from our tax attorney, supported by a strong accounting staff, is so vital during an IRS or California tax audit.
If you have been contacted by the IRS or a state tax agency about an audit, you need to fully understand all of the associated risks, best practices, and how to handle yourself during the initial audit. You will need advice, counsel, advocacy, and representation from an experienced, proven IRS audit and tax attorney from Janathan L. Allen, APC and support from the team at Allen Barron. Communicating directly with the IRS or an IRS revenue agent yourself is not prudent.
We invite you to learn more about the integrated tax, legal, accounting and business consulting services of Allen Barron and contact us or call today to schedule a free consultation at 866-631-3470.
