How to Challenge an IRS Audit Result the Right Way

Receiving an unfavorable IRS audit result does not mean the matter is over. Taxpayers have the right to challenge audit adjustments through the IRS appeals process. However, the way you pursue that appeal does matter. If you do it incorrectly, it can expand the dispute, delay resolution, or weaken your position.

The key is to approach an appeal strategically and within the strict procedures established by the IRS.

Start With the “30-Day Letter”

After most audits, the IRS sends a report explaining the proposed adjustments along with a letter informing you of your appeal rights, often referred to as a “30-day letter” (often IRS Letter 525).

Typically, you have 30 days to request a conference with the IRS Independent Office of Appeals if you disagree with the findings. The Appeals Office is separate from the audit division and is designed to resolve tax disputes fairly and without litigation whenever possible.

Missing this deadline can significantly limit your options.

Focus the Appeal on Law & Evidence

A successful IRS audit appeal must clearly identify:

• The specific adjustments being disputed
• The factual errors in the audit report
• The legal authority supporting your position (statutes, regulations, or case law)

The IRS expects a concise, written appeal—expanding the argument beyond the actual audit issues can sometimes invite additional scrutiny, which is why appeals should remain narrow and focused.

What Happens If You Do Nothing?

If you don’t respond to the 30-day letter, the IRS may issue a statutory Notice of Deficiency, often called a “90-day letter.” At that point, your main option to challenge the adjustment is to file a petition with the United States Tax Court within 90 days.

Missing that deadline generally allows the IRS to assess and begin collecting the tax.

The Real Goal of an IRS Appeal

Many taxpayers assume an appeal is about “fighting” the IRS. In reality, the Appeals Office evaluates cases based on what are known as the “hazards of litigation,” or the likelihood each side would prevail if the dispute went to court.

A well-prepared appeal grounded in facts and law often leads to negotiated resolutions without litigation for this reason. If you have a reliable tax attorney to help handle the appeals process properly, it can correct any audit errors and limit your exposure.

At Gabaie & Associates, LLC, we represent taxpayers both nationwide and in Maryland, in Baltimore, Columbia, Frederick, Rockville, and throughout the state. If you think the IRS audit decision is incorrect, we can help prepare your appeal within the 30-day window and ensure it meets IRS policies and expectations. Call (410) 358-1500 or fill out our contact form so we can discuss your appeal.