Published: | Last Updated: October 17, 2023
Taxpayer Disagrees with Assessment
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The IRS has assessed tax and/or penalties against you. The liability may be due to a filed return, an audit, assessment of an additional tax, and/or assessment of a penalty. This notice or letter is informing you of how much you owe, when it’s due, and how to pay.
The IRS assessed tax as the result of an audit, an additional tax assessment, assessment of a penalty, or the IRS may have filed a return on your behalf if you did not file (also known as a Substitute for return (SFR)).
There are several options available to dispute the balance owed when you disagree with the IRS.
You may request an audit reconsideration when you disagree with the tax the IRS says you owe and any of the three situations below apply:
See Publication 3598 for more information on how to request an audit reconsideration.
If you do not file a return, the IRS is authorized to prepare what is known as a Substitute for Return (SFR), in which the IRS calculates your tax and any interest and penalties based on information available to the IRS. If the IRS filed an SFR, you can still submit your own tax return. Because the IRS may not have complete information about your situation, it may overstate your tax liability. This could mean you owe more tax than if you had filed your own return. If the IRS files an SFR, it’s still in your best interest to file your own tax return to take advantage of any exemptions, credits, and deductions you’re entitled to receive.
You can also pay the balance due in full and then file a claim for credit or refund of tax with an Amended Return (IRS Form 1040-X, Amended U.S. Individual Income Tax Return). For a refund of interest, penalties, or additions to tax, or a refund of certain types of tax (other than income tax), you may submit Form 843, Claim for Refund and Request for Abatement. Generally, you must file a claim for credit or refund within 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later. If you do not file a claim within this period, you may no longer be entitled to a credit or a refund. Note that even if you file a timely claim for credit or refund, there could be limits on the amount of the credit or refund you can obtain, depending on when the tax was paid. See Publication 556, Examination of Returns, Appeal Rights, and Claims for Refund.
You may request Innocent Spouse relief by submitting Form 8857, Request for Innocent Spouse Relief, if your spouse (or former spouse) improperly reported items or omitted items on your joint income tax return and you believe you should not be held responsible for part or all of the tax, and any related penalties and interest. See Publication 971, Innocent Spouse Relief, for more information.
You can file an Offer in Compromise with Doubt as to Liability when you do not believe you owe the tax or you do not believe the amount is correct. You can submit the offer using Form 656-L which includes instructions for completing the offer, a pre-qualifier assessment to help you determine if the offer is the correct resolution, and the terms you are agreeing to by submitting the offer.
You may be able to raise your arguments in a Collection Due Process (CDP) hearing or an equivalent hearing. The existence or amount of tax can be disputed in a CDP or equivalent hearing only if you did not receive a Notice of Deficiency before the tax was assessed or otherwise have an opportunity to dispute the balance. See also Publication 1660, Collection Appeal Rights, and Publication 5, Your Appeal Rights and How to Prepare a Protest If You Don’t Agree.
If you believe you may be a victim of Identity Theft, you should contact the IRS immediately. See Publication 5207, Identity Theft Information for Taxpayers, and Form 14039, Identity Theft Affidavit for more information.
You can go to www.irs.gov, call the IRS tax law phone line, (800-829-1040), or use the IRS forms and publications.
Publication 3598, What Should You Know About the Audit Reconsideration Process
The Taxpayer Advocate Service is an independent organization within the IRS that helps taxpayers and protects taxpayers’ rights. We can offer you help if your tax problem is causing a financial difficulty, you’ve tried and been unable to resolve your issue with the IRS, or you believe an IRS system, process, or procedure just isn’t working as it should. If you qualify for our assistance, which is always free, we will do everything possible to help you.
Visit www.taxpayeradvocate.irs.gov or call 1-877-777-4778.
Low Income Taxpayer Clinics (LITCs) are independent from the IRS and TAS. LITCs represent individuals whose income is below a certain level and who need to resolve tax problems with the IRS. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. In addition, LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Services are offered for free or a small fee. For more information or to find an LITC near you, see the LITC page on the TAS website or Publication 4134, Low Income Taxpayer Clinic List.
Taxpayer Disagrees with Assessment