Philadelphia Tax Attorney for IRS Audit Reconsideration

The Internal Revenue Code allows the IRS to abate any assessment of tax and applicable interest and/or penalties if the assessment is excessive, erroneously or illegally made, or made after the statute of limitation has expired. To implement this principle, the IRS has established an additional procedure by which taxpayers who have been unable to follow the regular procedural track can get a second chance to dispute the outcome of an audit of his or her tax returns. If an erroneous assessment has been made and a taxpayer has not paid it, under certain circumstances the IRS may accept a request for audit reconsideration.

What is an Audit Reconsideration?

An Audit Reconsideration is the process the IRS uses to reevaluate the results of a prior audit where additional tax was assessed and remains unpaid, or a tax credit was reversed. If the taxpayer disagrees with the original determination, he/she must provide information that was not previously considered during the original examination.

The most significant benefit of the audit reconsideration process is that it affords taxpayers — who did not participate in the initial examination at all, or, for whatever reason, did not take an administrative appeal or timely pursue their case in U.S. Tax Court after an unfavorable examination report — the chance to present their case on the merits.

When Will the IRS Agree to Reconsider the Results of an Audit?

A request for reconsideration will be considered if the taxpayer requests the abatement of an assessment based on information that was not previously considered which, if considered, would have resulted in a change to the assessment, if there was an IRS computational or processing error in assessing the tax.

A request for reconsideration will not be considered if:

  1. the taxpayer has already been afforded an audit reconsideration request and did not provide any additional information with his/her current request that would change the audit results;
  2. the assessment was made as a result of a closing agreement or waiver signed by the taxpayer;
  3. the assessment was made as a result of an accepted offer in compromise;
  4. The United States Tax Court has entered a decision that has become final, or a District Court or the United States Court of Federal Claims has rendered a judgment on the merits that has become final.

Can I Dispute an IRS Audit Reconsideration Determination?

An administrative appeal from an adverse decision on the merits of an audit reconsideration will be given where the taxpayer's request is disallowed in full or part.

If the taxpayer does not wish to appeal but still wishes to dispute the audit reconsideration determination, the taxpayer must pay the full amount due and file a claim for refund with the Internal Revenue Service within three years from the time the return was filed or two years from the time the tax was paid, whichever expires later, or if no return was filed by the taxpayer, within two years from the time the tax was paid. Upon the denial of the claim or the expiration of the waiting period, the taxpayer may then file a refund action in the District Court or the Court of Federal Claims.

Philadelphia tax attorney Joseph R. Viola has assisted many taxpayers in obtaining the "second chance" afforded by the IRS Audit Reconsideration process and can help you determine whether you are eligible for Reconsideration — as well as whether you have a reasonable likelihood of improving you tax situation through use of this process. Call or contact us immediately to schedule a face-to-face consultation to discuss the status of your specific federal tax matter and whether Audit Reconsideration is worth pursuing.