How to Appeal an IRS Decision on Your Tax Debt Case

How to Appeal an IRS Decision on Your Tax Debt Case

Dealing with the IRS can be super stressful, I feel you. If you received a letter saying the IRS made a decision you disagree with regarding your tax debt, you have the right to appeal. Don’t panic! Appealing an IRS decision might sound intimidating, but this article will walk you through the process step-by-step. I’ll explain everything in simple terms a high schooler could understand.

Should You Appeal an IRS Decision?

Appealing an IRS decision is worth considering if you disagree with their findings and have evidence to support your position. Here are some common reasons people appeal IRS decisions on tax debt:

• The IRS says you owe more tax than you think you do
• The IRS denied your offer in compromise
• The IRS filed a lien against your property
• The IRS wants to levy your bank account or garnish your wages

Before appealing, honestly assess whether the IRS made a mistake, or if you just don’t like their decision. You need solid legal grounds to win an appeal. The appeals process takes time and effort, so don’t bother appealing if you know the IRS is right.

How Does the Appeals Process Work?

The IRS Appeals Office operates independently from the IRS examiners who made the original decision. They take a fresh look at your case to determine if the IRS followed the law correctly. Here’s the basic appeals process:

1. Request an appeal within 30 days of receiving your IRS notice.
2. The Appeals Office reviews your request and decides whether to accept your case.
3. You (and your representative) present your evidence and arguments to the Appeals Officer.
4. The Appeals Officer makes a final determination about your tax debt.

This is a simplification – the actual appeals process has a lot of variation depending on your specific tax issue. We’ll break it down more below.

Step 1: Submit a Request for Appeal

To start the appeals process, you need to submit a formal Request for Appeal to the IRS. The IRS notice you received should include instructions on how and where to file your appeal. Usually, you submit appeals requests to the address shown on your notice.

You typically have 30 calendar days to request an appeal from the date on your IRS notice. Don’t miss this deadline! If you do, you’ll lose your right to an administrative appeal. You can still take the IRS to tax court, but that is much more difficult.

Your request for appeal should include:

• Your name and contact information
• A copy of the IRS notice you are appealing
• The tax periods or years involved
• A detailed explanation of why you disagree with the IRS decision
• Supporting documentation, like receipts or legal precedents

Make sure to be thorough in stating your grounds for appeal. The Appeals Officer who reviews your case relies solely on the information you provide. Help them understand why the IRS made a mistake in your specific situation.

Step 2: IRS Decides Whether to Accept Your Appeal

Not every appeal request gets accepted. The Appeals Office decides whether your appeal meets their requirements to proceed. They generally accept cases where:

• You filed your appeal on time
• You have a legitimate disagreement with an IRS decision
• You provide the required documentation

The Appeals Office does not accept cases for many reasons, like if you previously had an appeal hearing on the same issue. They send a letter explaining why they rejected your appeal request.

Step 3: Present Your Case to the Appeals Officer

If the Appeals Office accepts your case, they assign it to an Appeals Officer for review. The Appeals Officer is like a judge who remains neutral until they review all the evidence. They have the authority to make a final decision about your tax dispute.

You can present your appeal to the Appeals Officer either in writing, over the phone, or in-person. Submit any additional evidence that supports your position, like:

• Receipts, bank statements, or bookkeeping records
• Letters from creditors, employers, or other sources
• Memos explaining your legal rationale, with citations

If you don’t understand the tax codes and precedents, seriously consider hiring a tax attorney or CPA to represent you. They can argue your case using the IRS’s own rules and regulations.

Step 4: Receive the Final Determination

After reviewing your appeal, the Appeals Officer issues a final determination in writing. Their decision letter explains their findings and the legal basis for their conclusion. If the Appeals Officer rules against you, you still have options like petitioning the U.S. Tax Court. We’ll explain those options later.
If the Appeals Officer adjusts the IRS decision in your favor, you won! The Appeals Office will ensure the IRS makes any changes necessary to implement their final determination about your tax debt. This decision takes precedence over the original IRS notice.

Tips for a Successful Appeal

Here are some tips to boost your odds of winning an IRS appeal:

• Get professional help – Consider hiring a tax pro to handle your appeal. They know how to argue tax cases.
• Act fast – File your appeal request as soon as possible, before the deadline.
• Be thorough – Fully explain your position and provide extensive documentation.
• Negotiate – If you have a weak case, try to negotiate a settlement with the Appeals Officer.
• Follow the rules – Comply with all IRS requests and guidelines throughout the process.

It also helps to be flexible. For example, if you appealed an IRS levy on your bank account, the Appeals Officer may agree to lift the levy if you pay a lesser amount immediately. By compromising, you can often reach a mutually acceptable solution.

What If Your Appeal is Denied?

If the Appeals Office upholds the original IRS decision, all is not lost. You can still take the IRS to court over your tax dispute. Here are some options if your appeal gets denied:

File a Petition with U.S. Tax Court

Within 90 days of receiving a final determination from Appeals, you can file a petition with the U.S. Tax Court. This court hears federal tax cases and has the power to override IRS decisions. Have an attorney help prepare your petition.

Request Judicial Review

For some cases involving employment taxes or levies, you can request judicial review by a federal district court. This involves filing a civil action lawsuit against the IRS.

Request a Collection Due Process Hearing

If the IRS plans to levy your property or bank account, you can request a Collection Due Process hearing within 30 days. This is like another appeal focused specifically on the collection action.