What is IRS Audit Reconsideration & Audit Reconsideration Process

IRS audits can be overwhelming and unsettling because individuals keep asking where exactly they went wrong? But don’t worry, it can be contested, but via something more like a plea. The IRS Audit Reconsideration request is one of the many options you probably should explore in depth, in case the IRS has made an assessment on the basis of your return and has imposed more tax liabilities. You have all the rights to disagree with the results of an IRS audit, which is exactly why you have the option to request an Audit Reconsideration. It allows taxpayers to request the IRS to consider their position. This is where the IRS takes a second, and more detailed look at your audit results in order to come to a conclusion of them being appropriate. 

This totally means that however answerable you are to the government, you might as well have the right to challenge them. This time, via a request.

If you want to get an Audit Reconsideration, consider submitting a formal written request to the IRS. In the Audit Reconsideration request, you must explain in detail why you believe the audit results were originally incorrect in status, with any supporting documentation you have close in reach. It is very essential to note that an Audit Reconsideration is really not a formal appeal. But what exactly is it?

Potential Reasons To Request An IRS Audit Reconsideration

It is often very scary to receive audit notices. It is not like that people like the encounter with the IRS, especially in regard to auditing or background checks. It is undeniable that the IRS is majorly looking forward and is deeply focusing on discovering returns that signal big red flags and potential tax evasion penalties.

However, if you won’t believe that what they have is not fully accurate, you can consider submitting a request to the IRS to undergo the IRS Audit Reconsideration procedure, especially in favor of the conditions below:

You were not Present for the Audit Appointment

During an audit reconsideration request, you need to present all the documents with support for the income, deductions, or credits you have claimed on your return. The information regarding how and when to put these records forward is going to be mentioned in the notice. You can file an Audit Reconsideration IRS request in case you were unable to be present for your audit appointment or mail the records. The only thing the IRS can consider is a reasonable justification as to why the notice was not fully complied with.

You moved Homes and didn’t receive the Notice

The IRS believes that if an audit notice has been dispatched, it should soon be at the doorstep of the taxpayer. The department will follow the path of the audit in case they do not hear back within a given time span. That’s even if the taxpayer has moved elsewhere. For these cases, you’ll need to provide proof that the address no longer has your name or presence in it. 

You have disagreed with the Audit Assessment

A reconsideration request can also be made in case you strongly disagree with the assessment that has been made by the IRS from an audit of your return. This equally applies to an assessment that has been governed under the authority of Internal Revenue Code 6020 (b) Substitute for Return (SFR). 

You are carrying New Information that wasn’t Originally Shown

It is a possible scenario that new information has emerged your way after you have been audited. This information encircles your income expenses or deductions which can also help the IRS to make a fair assessment of every bundle of your tax liabilities.

Requirements to Request IRS Audit Consideration

There is absolutely no guarantee that the IRS Audit Reconsideration you placed will be reviewed or accepted. It should have a couple of requirements to meet in order for your request to be considered,

  • You should have originally fined a return.
  • The tax assessed is left unpaid or the IRS probably has reversed any form of tax credits that you disputed. 
  • Recognise the adjustments you’re disputing.
  • You should be able to provide new information which wasn’t taken into consideration during the original examination.
  • Regardless of whether there has been an IRS computational error while assessing, the amount of tax is still due from you.

How to Request IRS Audit Reconsideration

In order to request an IRS Audit Reconsideration, you should follow the steps below:

Review all Reports and Collect Documents

The IRS is going to send you an original audit report which defines how it has come to make the assessments. It is important to review them carefully in order to find out which items you would like the department to formally reconsider. This can allow you to collect several important documents to further support your request.

Submit Documents to the IRS

Every copy of all relevant documents needed to be submitted to the IRS. This is going to include a copy of your audit report and the other documents which you are relying upon to support the request you have made. This can include anything from Forms 1099 to loan documents. Alongside that, you should also include a letter which briefly highlights the reasons to seek reconsideration. It can be done either via Form 12661 or a simple letter.

Get and Attach IRS Form 12661

Form 12661 is considered as an official letter which taxpayers can fill out in order to request reconsideration. You can also equally write a simple letter to the IRS in case you do not use this form. You have to fill out the sections in the IRS form 12661 to provide all relevant information about your request.

Attach Form 4549

Also known by the name of Tax Examination Changes letter, the IRS form 4549 provides a brief summary of the proposed changes by the department for your tax return, besides any penalties and interest concluded on the basis of the audit. The IRS form 4549 substantiates the disputes you have raised.

How Do I Write an Audit Reconsideration Letter?

The question of “how to write a letter of reconsideration?” baffles many. But, it is absolutely not essential to use Form 12661 as the source of request for reconsideration can also be obtained via a simple letter addressed to the IRS. In case you choose to write a letter, make sure that it provides all the information that can support your case. 

This letter should bring to attention the reasons why you are asking for a Reconsideration, the assessments you have been disputing, and also give an overview of the new information you now rely on. 

Most taxpayers who walk this lane try searching for an audit Reconsideration letter template because they are often confused about what to start with. How to write a letter to IRS sample? Find the answer right below!

IRS Audit Reconsideration Sample Letter

The audit reconsideration letter template must have a proper address which specifies your case and detailed information that can help the IRS to reach a favorable point of conclusion. A general sample looks like:

[Your Name]

[Your Address]

[City, State ZIP Code]

[Date]

[IRS Address]

[City, State ZIP Code]

To Whom It May Concern,

I am writing in order to request a reconsideration of audit results for the tax year [Insert Tax Year] in my name. I have just received a notice of deficiency which specifies taxes unpaid, penalties and interest.

I understand that the IRS has already completed auditing, but it has come to my knowledge that there are a couple errors to discuss. I have further attached a detailed elaboration of documentation and my concerns to support my state. 

I believe that this information was originally not taken into consideration during the audit process. I am requesting that the IRS reopens the audit and gives an additional look to review all the new information and reconsider the decision made.

I can also provide any additional documentation or information that may be needed to support my case and if it is required. I appreciate you looking forward to resolving this issue as soon as possible.

Sincerely,

[Your Name]

The template can be used for a variety of purposes, including but not limited to Notice of Deficiency, IRS wage garnishment, and more.

Drafting an Audit Reconsideration Template

You have already had a close look at how to write a letter to IRS to appeal. So, it is important to note that you only have one shot at the reconsideration process, meaning that everything you have considered to make this decision should be sent to the IRS. Even though the process seems quite easy, the best way to understand all technicalities is by seeking help from the IRS tax professionals to look deep into all the cases you might have missed. The question of “how do you write a letter to IRS?” is already solved for you, but what isn’t still remains intact. In order to send the letter, you will need viable documentation to support your claims, meaning that it’s best to let the professionals handle the rest. 

How Long Does Audit Reconsideration Take?

 

After you have sent your request, expect to hear back from the IRS almost within a time span of 30 days. However, there can be times when the IRS takes longer than that. After they have gone through your request, they might send back an IRS Submission Processing Letter, enabling you to know that they have received and processed a tax return, payment or other types of documents.

In case you want to hurry the process, write to the Taxpayer Advocate’s Office and further request them to expedite. For the same, you are required to fill Form 922 “Request for Taxpayer Advocate Assistance”.

If the IRS rejects your request or you do not respond for additional information within a span of 30 days, the collection activity most probably will be back to life again after the final decision.

In case they accept your request, the additionally assessed tax will be removed. They might also consider reducing the tax debt. So, get in touch with one of the major tax agent services to understand where you stand today in cases like these.

Conclusion

The IRS has the authority to send you an audit in case they find any form of error in your return. But, with all that in hand, you still can contest their decision if you have evidence that can prove them otherwise. The IRS Audit Reconsideration is one of the many forms of contesting the government by requesting them to review your position with all the new information in hand. The process might not be as easy as it might seem, yet if you think that’s the best thing you should be doing now, then consider doing it anyway.

Author

Mr. Joshua A. Webskowski

Joshua specializes in successfully resolving cases in all areas of tax resolution including liens, levies, & other IRS collections cases.

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