Experienced Legal Support for IRS and State Tax Audits
Getting the news that you've been chosen for a tax audit by the IRS, state, or local taxing authority can be incredibly stressful. Feeling overwhelmed and worried about what this means for your finances is understandable. At The Wilson Firm, we also guide clients through the appeals process if you disagree with the audit findings, helping you challenge assessments and secure fair resolutions without unnecessary escalation.
What to Expect During a Tax Audit
During a tax audit, a trained government employee will thoroughly examine your tax returns and other financial documents to look for any signs of tax underreporting, excessive deductions, or evidence of tax evasion. It's important to note that small businesses and self-employed individuals are often targeted for audits more frequently than other taxpayers, so it's crucial to be prepared if you fall into these categories.
The audit process may involve a government agent visiting you at your home or business, or you may be asked to appear at a local IRS or state government office. Alternatively, you may receive an audit correspondence where you'll be contacted via mail and asked to provide supporting information or documentation to the IRS or state taxing agency.
How to Deal with a Tax Audit
If you're facing a tax audit, it's essential to have skilled representation to help you navigate the process and achieve the best possible outcome. That's where The Wilson Firm comes in. Our team has the expertise and experience to assist you before, during, and after the audit. We understand the intricacies of tax law and can help guide you through the examination process.
It's important to note that the consequences of a tax audit can be severe. If the auditor finds that you owe additional taxes, you may also be subject to penalties and interest. In some cases, the auditor may even determine that you're guilty of tax fraud, which can result in civil fines and criminal penalties. That is why it's crucial to be well-prepared and have professional representation to advocate for your best interests during the audit.
Navigating the Appeals Process
If you disagree with the results of your IRS or state tax audit, you have the right to appeal the decision. The appeals process provides an opportunity to present additional evidence, challenge the findings, and potentially reduce or eliminate assessed taxes, penalties, and interest. At The Wilson Firm, our attorneys are well-versed in both federal and Texas state appeals procedures, ensuring your case is handled with precision and advocacy to achieve the best possible resolution.
IRS Appeals Process
The IRS Independent Office of Appeals offers a fair, impartial way to resolve disputes without going to court. Here's a step-by-step overview:
- Eligibility and Request: You can appeal most audit or collection decisions if you disagree with the IRS's determination. To request an appeal, file a formal written protest (following guidelines in IRS Publication 5, Your Appeal Rights and How to Prepare a Protest If You Disagree) within 30 days of receiving the audit report or notice. For collection actions, use Form 12153, Request for a Collection Due Process or Equivalent Hearing. Mail it to the IRS office that issued the decision—do not send it directly to Appeals to avoid delays.
- Review and Conference: Once received, your case is forwarded to the Independent Office of Appeals for a fresh, objective review. An Appeals officer will contact you (often by phone or mail) to schedule a conference, which can be in person, by phone, or video. During this stage, you'll discuss the facts, law, and any new evidence. Appeals aims to settle cases fairly, considering both taxpayer and government interests.
- Timeline and Outcome: The process typically takes several months, but Appeals prioritizes timely resolution. If no agreement is reached, you can petition the U.S. Tax Court for a trial (no prepayment required for deficiencies under $50,000 in some cases). We'll monitor deadlines and represent you throughout to protect your rights.
Appealing to the IRS can resolve up to 80-90% of cases without litigation, saving you time and costs.
Texas State Tax Appeals Process
For audits by the Texas Comptroller of Public Accounts, the appeals process is structured to provide multiple levels of review, from informal to judicial. We specialize in Texas-specific procedures to help you contest disagreed audits, examinations, or refund denials effectively.
- Initial Protest: After receiving the audit results, you have 30 days to file a written protest with the Comptroller's office, requesting a redetermination. Include supporting documents and a clear explanation of your disagreement. This triggers an informal review by an independent auditor or supervisor.
- Formal Hearing: If unresolved, request a formal hearing before the State Office of Administrative Hearings (SOAH). The Comptroller issues a proposal for decision, and you can submit briefs or evidence. Hearings are typically held within 6-9 months.
- Judicial Review and Recent Changes: If you disagree with the SOAH decision, appeal to district court in Travis County (Austin) within 30 days. Thanks to recent legislative reforms (e.g., Senate Bill 903), you no longer need to pay the disputed amount upfront to pursue a court challenge, making the process more accessible. For more details, refer to Comptroller Publication 96-1253, Contesting Disagreed Audits, Examinations and Refund Denials.
Our team at The Wilson Firm has successfully navigated these steps for numerous clients, often securing reductions in liabilities through negotiation and evidence presentation. We handle all communications, deadlines, and filings so you can focus on your business or personal matters.
Don't Face a Tax Audit or Appeal Alone
At The Wilson Firm, we strive to provide personalized and compassionate assistance to our clients during the stressful experience of a tax audit or appeal. We'll work closely with you to understand your unique situation and develop a strategy to achieve the most favorable outcome possible. Our team will handle the complex paperwork, communicate with the auditor or Appeals officer on your behalf, and ensure your rights are protected throughout the process..
If you've received notice of a tax audit or need help with an appeal, don't face it alone. Contact The Wilson Firm today and learn how we can help you navigate the examination and appeals process with confidence and peace of mind.
Frequently Asked Questions
You'll receive a formal notice via mail, such as an IRS Letter 566 (for correspondence audits) or a field audit letter. State audits from the Texas Comptroller often come as a "Notice of Audit" or examination letter. If you suspect an audit, check your mail carefully and contact us immediately to review the notice and prepare a response.
Do not ignore it—respond promptly within the deadline. Gather your records, but avoid providing more information than requested without guidance. At The Wilson Firm, we recommend consulting an attorney right away to review the notice, represent you in communications, and develop a strategy to minimize exposure and potential adjustments.
For IRS appeals, yes—you can appeal without prepayment and petition Tax Court if needed. For Texas state taxes, recent changes (like Senate Bill 903) allow judicial appeals without upfront payment of the disputed amount. We help ensure you meet all deadlines to preserve these rights.
Correspondence audits can wrap up in 3-6 months, while field audits may last 6-12 months or longer, depending on complexity. Appeals add 3-9 months. Our experienced team at The Wilson Firm works to expedite the process, handling documentation and negotiations efficiently to reduce your stress and timeline.
Penalties can include accuracy-related (20% of underpayment), negligence (up to 25%), or fraud (75%), plus interest. We mitigate these by challenging findings early, negotiating abatements, and building a strong defense with evidence. Our track record includes waiving penalties for clients through appeals and settlements.
