What is administrative appeal?

If the IRS’s decision or action taken is unfair or incorrect, an administrative appeal will allow you to have a second chance to appeal the decision or action, which may lead to a more favorable outcome for your tax situation.

Who handles the appeal?

The IRS Office of Appeals. This office is separate from the IRS office, which handled your case and resulted in the decision that you disagree with. According to the IRS , generally speaking, the Office of Appeals does not discuss cases with the IRS or the offices in the IRS that issues the tax due decision.

How do I apply for an appeal?

It depends on the amount of tax assessed. When the amount is less than $2500, the taxpayer can request the appeal with IRS personnel who assessed you the taxes. If the amount is greater than $2500 but not greater than $25,000 then forms have to be completed or a complete and detailed written statement explaining the specifics of your dispute. When the amount is greater than $25,000 a full request must be submitted, which includes, in addition to forms, information related to the request such as supporting documentation. When you are in a situation where you disagree with the IRS decision in a tax assessment, and you feel that you want or should appeal their decision, please be careful to review all the facts, do your research on the types of appeals available to you and the different use of each type. Complete required forms or statements carefully, and make sure the information is complete and accurate. If you need help, we are here to help you. Please take advantage of our free consultation where we can discuss your situation and discuss your alternative solutions.

What is Trust Fund Penalty?

A Trust Fund in terms of employment tax should not be mistaken with a trust fund in terms of wealth management. This is the payroll tax amount assessed to the officers of the business. Tax resolution can help reduce and or arrange the payment of these taxes.

What is a Trust Fund Recovery Penalty (TRFP)?

A Trust Fund Recovery Penalty can be assessed if the unpaid trust fund taxes cannot be immediately collected from the business. This often happens if the business falls on hard times and taps into that fund for any reason. According International Revenue Code 6672(a) an individual can be held liable for penalty for willful failure to collect, account for, or pay to the IRS the taxes for the business.

Who is Held Responsible for the TRFP?

According to the IRS, the TRFP can be assessed against any person who is: responsible for collecting or paying withheld employment taxes, willfully fails to collect or pay the taxes.

Administrative Appeal - Bullseye Tax Relief - An unfair or incorrect decision

Administrative Appeal

What Is An Administrative Appeal?

An Administrative Appeal gives you a chance to reverse or stop an unfair or incorrect IRS decision or action. Consequently, you may receive a more favorable outcome for your tax situation.

The term “Administrative Appeal” applies to any appeal filed regarding action taken by the IRS. Any IRS decision or action can be appealed. For instance, this includes IRS decisions made during an audit or decisions to collect on a tax debt. Moreover, you can appeal any IRS decision felt as unfair or incorrect without going to court. You file your appeal through their Office of Appeals, a separate entity from the IRS themselves.

What Is The Administrative Appeal Process?

All Administrative Appeals are filed through the IRS Office of Appeals. This Office is separate from the tax office of the IRS. Any taxpayer disputing an IRS decision or tax audit has the right to appeal before going to court. The appeal method is often more cost effective than going to court.

In some cases, after an appeal is filed, the IRS will request either written arbitration or a hearing. This hearing with an official within the IRS Office of Appeals is usually by phone. Subsequently, final decisions are made at this hearing or through optional arbitration. However, most appeals to the IRS are made through a tax professional. Moreover, you can appeal a rejection of an appeal. An Administrative Appeal halts any IRS collection actions against you until the appeal is resolved and a decision is made.

When Do I File An Administrative Appeal?

The timing for filing an Administrative Appeal depends upon the type being filled. You should file an appeal as:

quickly as possible,
soon as possible after the IRS makes a decision you disagree with
soon as possible when being audited by the IRS so that no actions are taken before you can appeal

Types Of Appeals And Situations

Here are some examples of situations for filing an Administrative Appeal:

Decisions made during a tax audit
Rejection, termination, modification or any change to an Installment Agreement
Rejection or undesirable response when applying for an Offer in Compromise
Any collection decision or action made by the IRS
Notice or placement of any levies, liens or seizures of property
Rejection of an appeal

The most common types of appeals are Collection Due Process (CDP) and Collection Appeal Program (CAP). However, you can file other types of appeals based upon your situation.

Next Steps:

You must consult with a tax professional if the IRS has taken an appealable action against you. A professional can guide you through the best options and processes. Furthermore, Administrative Appeals are complicated. Moreover, sometimes appeals do not produce the best outcome. A tax professional can provide you with various options. Give us a call today. We can help you handle any undesirable decisions made by the IRS based upon your situation.