How to Appeal Your IRS Audit

Let's say your tax return is examined by the IRS and you do not agree with the results of the examination.  What happens next?  Are you just stuck in the mud or can you take the matter higher up?  Luckily for taxpayers today, further appeal within the IRS is permitted.

When the IRS has concluded its audit it then issues what's known as a "30-day letter."  This is a letter that gives you exactly 30 days in which to act.  If you get one of these during your IRS audit and don't know what to do, please consider calling a tax lawyer for help. 

Once the IRS has issued a preliminary 30-day letter, you have the right to appeal to a local Appeals Office by filing a written request for appellate consideration. This is the only level of appeal within the IRS. Appeals conferences are conducted in an informal manner, meaning that you can have the appeals conference by telephone and simply tell your side of the story.  The IRS agent who did the audit will seldom if ever be on the phone with you, just the appeals officer.

A taxpayer who requests a conference may also need to file a formal written protest. However, if the protested amount is not more than $25,000, you may want to consider making a small case request instead of a formal written protest ( IRS Publication 556).  You should also know that in addition to appeal or in lieu of appeal there's another avenue open to you.  If you decide to forego the right to submit a protest to the Appeals Office after receiving a 30-day letter you can still file a petition in the Tax Court within 90 days after the receipt of a statutory notice of deficiency.  That's a whole other article.

Here's another insight.  Small business and self-employed taxpayers can resolve their IRS audit disputes through what's known as fast-track mediation. Disputes can be resolved through this expedited process within 40 days, compared to several months using the regular appeals process.

If you represent a large or mid-sized business, you can resolve their tax disputes through a fast-track settlement program. The goal for this program is to reach settlement within 120 days. A similar fast-track settlement program for small businesses and self-employed taxpayers is being tested by the IRS but no word of its status has been released yet.

Here's your takeaway:  many taxpayers try to represent themselves during an IRS tax audit.  They usually have varying degrees of success, especially when compared with the much more professional approach taken by tax lawyers.  At any rate, if you're dissatisfied with the result of your audit, by all means call a tax lawyer for help with an appeal.  It just may be worth every penny and much more!

by: John Ellsworth, Tax Attorney at http://www.IRS-SOLV.com Want to know more? Come to IRS-SOLV and read other articles. Thank you.

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Division of Property During a Divorce

In a Divorce proceeding, the Court has the power to "justly and equitably" award property. Therefore, it is extremely important to note that the Court does not automatically apportion property division at fifty percent (50%) to each party. In many cases, the interpretation of "just and equitable" has meant an award of fifty percent (50%); however, this is always subject to the specific circumstances of the Divorce case.

The Court has the authority to divide "marital property." Therefore, it is helpful to develop a chart or summary of all of the marital assets as well as non-marital assets. Marital assets include anything of value that is accumulated after the date of marriage. This includes, but is not limited to, cash, accounts, investments, pension, 401(k) plans, real estate, investment property, business interests, or personal property items. Anything that has value and that was accumulated after the date of marriage is considered marital property and is subject to division by the Court.

Non-marital property is property that was either brought into the marriage by one party (e.g. a vehicle that was owned outright by one spouse before he or she got married) or if the property was received as a result of an inheritance during the marriage or was given as an exclusive gift to that particular party during the marriage. It is important to note that the Court assumes that all property is marital unless one party establishes to the satisfaction of the Court that it has a valid non-marital claim. This is typically done by "tracing" (showing a chain of events along with supporting documentation that would lead the Court to believe that the property was non-marital in nature). It is also important that the non-marital property is not "commingled" with marital property. For example, if one party receives an inheritance of $10,000, to retain its non-marital nature, it should be separate and apart from any marital funds and should not be "commingled" in a joint account.

In determining issues relative to property and debt, one of the most popular misconceptions is that title (who is listed as the named owner of the property) is important. Whether it is a vehicle, a pension plan, a 401(k) plan or any other asset, title is not the controlling factor relative to dividing an asset. If it was accumulated during the marriage, it is marital property regardless of whose name it is titled under. Another important consideration when analyzing and agreeing to a property division is that it is final. Once the Court signs a Divorce Decree, which gives an award of property to both sides, it is final. Absent extremely rare circumstances, it can never be changed.

When analyzing the property division, it is almost always a good idea to award an asset to a party who also is the debtor on that particular asset. For example, if one party is driving a Lexus motor vehicle and he/she is named on the loan or lease for that vehicle, he or she should be awarded that vehicle subject to the loan so that there is no confusion on the part of any party as to who will service that particular debt.

Farhan Hassan concentrates his practice on all areas of family law with a specialty in divorce, including custody, spousal maintenance, complex property issues, as well as appellate practice. Please visit http://www.allaboutdivorcemn.com for specific conversations about getting a divorce in Minnesota.

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