Prior to expensive and time-consuming tax litigation, taxpayers can avail themselves of a conference with an Appeals officer. This IRS official is usually a senior employee rising from the Revenue Agent ranks. This conference provides an opportunity for a "fresh look" at the proposed deficiency and proposed settlement. The Appeals officer may settle a case based upon the hazards of litigation, a consideration not available to the Examination division.
IRS Collections actions may also be appealed to Settlement Officers who are senior IRS employees who have previously been employed as Revenue Officers. The two Collections programs are the Collections Appeals Program (CAP) and the Collections Due Process program (CDP).
At times, we are asked to represent taxpayers during the Appeals process because the taxpayer or their current representative is unhappy with the outcome of an examination. Many CPAs, have referred their clients to us for the Appeal. Also, in our own cases, we will request an Appeals conference when we believe that the merits of the proposed deficiency do not warrant the settlement the government is proposing at the field level. We are sensitive to our client's cost/benefit aspects of this service.
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The IRS may require an examination of a taxpayer either inside of the IRS offices, "Office Audit", or at an external location, "Field Exam". Office audits are typically targeting individual returns, Form 1040 and related schedules, i.e.. Schedule C, Sole Proprietorships, Schedule A, Itemized Deductions, and Schedule E, Rental Properties. An office audit is performed by a tax examiner who is trying to verify deductions and determine that the taxpayer appears to have adequate income to support their lifestyle. The field examination is performed by a Revenue Agent who is an accountant and may be a CPA and/or an attorney. The examinations are typically in more depth than an office audit.
We represent the taxpayer as Power of Attorney. Our function is to facilitate the examination process as an advocate of our client. We analyze our client's books and records and apply relevant tax laws to determine the correct tax treatment. More often than not, the documentation and the law may be "gray" with regard to the issues. This is where our experience provides our clients with the best opportunity to arrive at the "correct" amount of tax in our opinion, which may be a lesser amount than that proposed by the IRS!
Dunn & Co., CPAs, P.A.
Former IRS Agent, All IRS Matters!
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Please contact Dunn & Co., CPAs, PA at your convenience for a free initial consultation. We’ll work with you one on one to determine a roadmap to success. We look forward to working with you soon.
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• Representation as Power of Attorney for IRS Examination and Collections matters.
• Preparation, filing, and representation for Offers in Compromise.
• Consultations with CPAs, attorneys, and taxpayers regarding examination, collections, appeals, etc.
• Forensic accounting and expert witness testimony in criminal tax cases.
When taxpayers owe the IRS money, there are several possibilities. First, it must be determined whether or not the amount owed, according to the IRS, is correct. Assuming it is correct, the taxpayer may need time to pay the balance or may not be in position to ever pay the entire balance.
In our capacity as Power or Attorney, we negotiate with IRS Collections personnel a proposed settlement based on our analysis of the facts and law. We will analyze the client’s financial circumstances in order to recommend an appropriate course of action. Results may include an installment agreement, an offer in compromise, or a referral to a bankruptcy attorney who concentrates in IRS issues. The main objective is to insulate the client from IRS enforced collections actions which may include the seizure and levy of assets or pay, while working towards a settlement.