IRS Agent’s Settlement Authority

With respect to questions of law, agents have no authority to settle or compromise a case based upon the hazards of litigation (i.e., they may potentially lose in court based on other court decisions), but in practice settlements or "resolutions" can occur during the examination process. However, an agent has limited, if any, authority to [...]

By | 2018-02-22T14:12:57+00:00 August 11th, 2016|IRS Audit|Comments Off on IRS Agent’s Settlement Authority

Four Possible Resolutions to an IRS Audit

There are four possible resolutions to an IRS audit: no change, agreed, unagreed, and partially agreed. No Change In this situation the agent accepts the return as filed and does not propose any deficiency adjustments to the return under audit. The taxpayer or the representative is notified of the "no change." Most agents send written [...]

By | 2018-02-22T14:17:43+00:00 July 6th, 2016|IRS Audit|0 Comments

IRS Audit – How Returns Are Selected

The IRS selects returns to audit using a variety of methods, including: Computer Scoring. Most individual returns are selected for examination on the basis of computer scoring. However, other types of returns can also be selected by the use of computer scoring. Computer programs give each return numeric "scores." The Discriminant Function System (DIF) score [...]

By | 2017-07-05T15:23:13+00:00 June 5th, 2016|IRS Audit|0 Comments

IRS Dispute Resolution Using the Taxpayer Advocate Program

Generally speaking, the Taxpayer Advocate can offer assistance with the IRS if, as a result of the application of the tax law, the taxpayers is suffering, or about to suffer, a significant hardship, is facing an immediate threat or adverse action; will suffer irreparable injury or long term adverse impact; has experienced a delay of [...]

By | 2017-07-05T15:23:13+00:00 May 25th, 2016|IRS Audit|0 Comments

IRS Audit – Offer in Compromise

An offer in compromise (OIC) is a procedure for settling unpaid tax accounts (after an IRS audit or otherwise) for less than the full amount of the assessed balance due.  The offer in compromise must cover all taxes, interest, and penalties owed.  The IRS may accept an offer in compromise when it is unlikely that [...]

By | 2017-07-05T15:23:14+00:00 April 19th, 2016|IRS Audit|0 Comments

IRS Audit Process Revised

The IRS Large Business & International (LB&I) Division released the final version of Publication 5125 (2-2016), Large Business & International-Examination Process (the IRS Audit Process), which revises its audit process. There are three phases to the audit process: Planning, Execution and Resolution. IRS Audit Process Planning:  This phase determines the scope of the audit (i.e., the [...]

By | 2017-07-05T15:23:14+00:00 April 15th, 2016|IRS Audit|0 Comments