Completing an IRS audit can feel like crossing the finish line of a marathon — but what comes after the audit is just as important. Once the IRS finishes reviewing your tax return, it issues official findings. Depending on the outcome, you may owe additional tax, receive a refund, or owe nothing at all. If you disagree with the results, you have the right to appeal — and often, appeals lead to reduced liabilities or full reversals. Here’s a step-by-step explanation of what happens after an IRS audit and how you can challenge the results if needed.
For the official overview, see IRS Publication 556: Examination of Returns, Appeal Rights, and Claims for Refund.
What Happens After an IRS Audit: Understanding Your Options
Step 1: You Receive the IRS Examination Report (Form 4549)
After completing your audit, the IRS examiner will send you an Examination Report — also known as Form 4549, “Income Tax Examination Changes.”
This report details:
- Any proposed adjustments (increased tax, penalties, or interest)
- The reasons for the changes
- Your rights to agree or disagree
If the IRS determines your return is accurate, you’ll receive a “no change” letter — meaning the audit is closed and no further action is needed.
Step 2: You Choose to Agree or Disagree
At this point, you have two main options:
👍 If You Agree
You can sign the report and pay any additional tax owed. If you can’t pay in full, you can apply for a payment plan or installment agreement through the IRS Payment Portal.
Once payment or arrangements are made, your case is closed.
👎 If You Disagree
You can refuse to sign the report and submit a written explanation of your disagreement. You’ll then receive a 30-day letter, which allows you to request a conference with the IRS Office of Appeals.
Step 3: Understanding the 30-Day Letter
The 30-day letter is one of the most critical stages in the audit process.
It gives you 30 days from the date of the letter to either:
- Accept the proposed changes, or
- File a protest (formal appeal) with supporting documentation.
Your protest should include:
- Your name, address, and contact information
- A statement of your intent to appeal
- The tax periods involved
- Detailed reasons for disagreement
- Supporting facts and legal authority
You can find detailed protest instructions in IRS Publication 5: Your Appeal Rights.
Step 4: The IRS Appeals Process
The Office of Appeals is an independent branch of the IRS that resolves disputes without litigation. Appeals officers review your file and may hold informal conferences by phone, mail, or in person. Most cases are resolved here, as the IRS aims to avoid court whenever possible. If you can demonstrate reasonable cause, provide new evidence, or identify errors in the audit findings, the Appeals Office may reduce or remove your liability.
Step 5: Notice of Deficiency (If You Don’t Respond or Appeal)
If you don’t respond to the 30-day letter, the IRS will issue a Notice of Deficiency (also called a 90-day letter). This is your final chance to challenge the audit before the IRS assesses the additional tax. You have 90 days (150 if outside the U.S.) to file a petition with the U.S. Tax Court. See Tax Court Filing Information.
Once the 90-day period passes, the IRS will assess the tax and begin collection actions (liens, levies, or wage garnishments).
Step 6: Paying or Resolving the Balance
If the audit results in a balance due, you can resolve it through:
- Full payment (with check, online, or via EFTPS)
- Installment agreement
- Offer in Compromise if you can’t afford to pay the full amount
- Penalty abatement for reasonable cause
You can explore resolution options on the IRS “Resolving Tax Debt” page.
Step 7: Requesting Audit Reconsideration (After Assessment)
If new information arises after your audit is closed, you may request an Audit Reconsideration. This allows you to re-open a completed audit if you:
- Found missing records
- Did not receive prior IRS correspondence
- Believe the IRS made a factual or computational error
When to Contact a Tax Attorney?
If your case involves significant tax liability, complex business issues, or potential fraud implications, seek legal counsel immediately. A tax attorney can:
- Draft your protest or appeal
- Represent you before the Office of Appeals
- Negotiate settlements or installment terms
- Escalate your case to Tax Court if necessary
Having professional representation significantly improves your chances of a favorable resolution.
Need help with a similar issue? Contact our firm today for a consultation.
The IRS audit process doesn’t end when the examination does — your post-audit response determines how smoothly you resolve your case. Whether you agree, appeal, or request reconsideration, acting within deadlines is crucial to preserving your rights.
If you’ve received a 30-day letter, Notice of Deficiency, or audit report, contact Pelham PLLC for experienced tax representation. Our team helps taxpayers respond strategically and resolve IRS disputes before they escalate.
FAQs
What happens if I agree with the IRS audit results?
If you agree, you’ll sign the report and pay any balance owed or set up a payment plan. Your audit is then closed.
What if I disagree with the IRS audit findings?
You can file a written protest and request a conference with the IRS Office of Appeals within 30 days of receiving the audit report.
How long do I have to appeal an IRS audit?
You have 30 days to respond to the 30-day letter and 90 days to file a Tax Court petition after receiving a Notice of Deficiency.
What is a Notice of Deficiency?
You can appeal within the IRS or take your case to Tax Court. A tax attorney can guide you through the appeals process and negotiate on your behalf.
Can I reopen an audit after it’s closed?
Yes. Through audit reconsideration, you can ask the IRS to re-evaluate your case if you have new evidence or documentation.
