Taxpayer's Rights in Audit and Appeal

Taxpayers' Rights in Audit and Appeal

The IRS is a huge advocate of taxpayers' rights and trains their employees to explain and protect rights of every taxpayer. These rights include but are not limited to: a right to professional and courteous treatment by IRS employees, a right to privacy and confidentiality about tax matters; a right to know why the IRS is asking for information, how the IRS will use it and what will happen if the requested information is not provided; a right to representation, by oneself or an authorized representative; and a right to appeal disagreements, both within the IRS and before the courts. When a return is selected for examination this in no way implies there was an error made or even that the taxpayer was being dishonest. For the most part, there are many times where the examination results in a refund to the taxpayer or acceptance of the return without change. A good amount of taxpayers file their returns and make payments in a timely fashion and accurately. Taxpayers have a right to expect fair and efficient tax administration from the IRS, including verification that taxes are correctly reported and paid with enforcement actions against those who fail to comply voluntarily.

At the beginning of each audit, the examiner explains the appeal rights. If the taxpayer does not agree with the proposed changes they may appeal by having a supervisory conference with the examiner's manager or appeal their case administratively within the IRS, to the U.S. Tax Court, U.S. Claims Court or the local U.S. District Court. If there is no agreement at the closing conference with the examiner or the examiner's manager, the taxpayer has 30 days to consider the proposed adjustments and their next course of action. If the taxpayer does not respond in 30 days, the IRS issues a statutory notice of deficiency, which gives the taxpayer 90 days to file a petition to the Tax Court. The Claims Court and District Court generally do not hear tax cases until after the tax is paid and administrative refund claims have been denied by the IRS. The tax does not have to be paid to appeal within the IRS or to the Tax Court. A case may be further appealed to the U.S. Court of Appeals or to the Supreme Court, if those courts accept the case.

The IRS Mission Statement: Provide America's taxpayers top quality service by helping them understand and meet their tax responsibilities and by