Audit Reconsideration may be available to taxpayers that were assessed under the IRS Automated Underreporter Program (AUR) and the Automated Substitute For Returns Program (ASFR). AUR assessments come about when information on returns filed by the taxpayer does not match information IRS receives from third party sources. Fail to respond to an IRS CP – 2000 or other matching notice and IRS will assess additional taxes based on information it has received such as 1099s and W-2s. ASFR assessments come when taxpayers failed to file required tax returns and IRS files a substitute return based on the information it received from third party sources. These substitute returns do not take into account any deductions to which the taxpayer would be entitled. Taxpayers may be eligible for audit reconsideration on these types of assessments even after additional taxes have been assessed and the collection process has begun.
Audit reconsideration may also be used to reevaluate the results of a prior audit when the taxpayer disagrees with the original determination, and the taxpayer can supply additional documentation which was not considered during the original examination or when the taxpayer believes that a deficiency was incorrectly assessed. A taxpayer might request audit reconsideration because: The taxpayer did not appear for the audit. The taxpayer moved and did not receive the IRS correspondence. The taxpayer disagrees with the assessment from the audit of their return and has additional information to be considered. The taxpayer disagrees with that assessment created under the authority of the Internal Revenue Service code 6020(b) (ASFR SFR). The taxpayer has been denied tax credits such as EITC claimed, during a prior examination.
Audit reconsideration is not available if: The tax payer has already been afforded a reconsideration request and provided no new information. The taxpayer has previously entered into a formal closing agreement with the IRS under code section 7121, using form 906 or form 866. The assessments were made due to a compromise under Internal Revenue Code Section 7122. The taxpayer entered into a “Offer of Waiver of Restrictions on Assessment and Collection of Deficiency in Tax” or “Offer of Waiver of Restrictions on Assessment and Collection of Deficiency in Tax”
The fact that collection action is in progress does not prevent the taxpayer from asking for and obtaining Audit Reconsideration.