When To Stop An IRS Audit

by Bruce Givner on October 3, 2011

When should you stop an IRS audit so that you can get to the IRS Appeals Division?

An IRS audit begins with the IRS asking a series of factual questions in the form of IDRs: information document requests. As part of the IRS audit, the auditor may also ask to meet with the taxpayer. The taxpayer’s representative, typically the accountant who prepared the return, will try to meet with the auditor instead of having the taxpayer meet with the auditor.

At some point the auditor will state a position on one or more issues. For example, in the audit of a closely held business, assume the auditor believes that a corporation’s loan to the shareholder should be reclassified as compensation. Your accountant has complied with the IRS audit and provided the auditor all requested information, including the payment schedule and the board action authorizing the loan. The auditor then asks, in essence, sign the proposed list of assessments or give me any other arguments you have. At this point, you should stop the IRS audit and contact an expert tax attorney. You need to bring new information and new arguments to the table. The auditor’s mind is clearly made up. So have the auditor write up the case, and make sure you or your CPA contact an expert tax Attorney. If less than one year remains in the statute of limitations, you must file a petition in Tax Court to get to the IRS Appeals Division. However, you want to get to the IRS Appeals Division, which is when you will hire an appraiser to value your compensation. The appraisal will be the NEW FACT and NEW ARGUMENT you need to win your matter.

So when you or your CPA are asked to sign a list of proposed assessments, or present new arguments, it’s time you stop the IRS audit and contact an expert tax attorney.

{ 8 comments… read them below or add one }

admin October 7, 2011 at 2:22 pm



Carajean October 29, 2011 at 7:05 pm

My problem was a wall until I read this, then I smsaehd it.


Hellen Long October 8, 2011 at 2:17 am

Appreciated the share!


Minerva October 29, 2011 at 6:04 pm

We’ve arrvied at the end of the line and I have what I need!


Bubbi October 27, 2011 at 4:16 am

Hats off to whoever wrote this.


America Didion November 2, 2011 at 2:48 am

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admin November 2, 2011 at 9:35 am

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