There are probably very few people in the greater Chicago area who really want to go through an IRS audit of their federal tax returns, even if it is simply a desk audit involving an exchange of correspondence.
The process will involve time and resources, and it may end with the IRS demanding additional tax money, as well as interest and penalties for not paying in a timely fashion. This is so even if the underpayment was not malicious.
Sometimes, as frustrating as it is, it may be best to just work out a resolution with the IRS and move on from an audit, even if one does not agree. However, in other cases, a taxpayer may wish to know what his or her legal options are for appealing an audit that the taxpayer finds unfair.
While there are options that involve going to a federal court, the IRS also has an internal Office of Appeals that one can use under certain circumstances. Although still part of the IRS, the Office of Appeals does everything in its power to act as a neutral decisionmaker in tax disputes, even if that means ruling against the agency’s enforcement authorities.
Not every case is suitable for an appeal, and, even in cases where an appeal is possible, one should carefully consider the option, perhaps with the help of an experienced tax attorney. Moreover, there are certain procedural steps that must take place in order for an appeal to be accepted. For instance, even during the audit, it is important for a taxpayer to clearly state all of the fact and law in support of his or her position.