Disagreeing with a government office over a tax assessment can feel like a David and Goliath scenario that is impossible to overcome.
Taking a structured approach to the situation can help you plan your next steps and rationally address the issue. Here is a guide to help you manage your circumstances effectively.
Understand the assessment
First, carefully review the tax assessment notice. Identify the specific areas of disagreement and gather all related documents, including tax returns, receipts and previous correspondence with the IRS or Indiana Department of Revenue.
If you encounter something you do not understand or believe to be incorrect, consider getting a legal opinion about your situation.
Consider your options
When the tax assessment results from an audit, you can request a reconsideration. This may be an option if you have new information to add or did not receive the audit report. Submit your audit reconsideration request along with supporting documentation to the appropriate office.
A second possibility is filing an appeal. For IRS disputes, submit a written request to the IRS appeals office. For Indiana tax disputes, follow the state’s appeal process, which involves submitting a protest letter in a specified period.
Another option is to pay the assessed amount and then file a claim for a refund. For IRS disputes, use Form 1040-X for amended returns or Form 843 for refund claims. Indiana has similar forms and procedures for claiming refunds.
A rational approach like this can help you weigh each decision you face before making a firm commitment. Combined with guidance from an experienced representative, it can help to ensure your tax obligations are accurate and fair.