Audit reconsideration: reopening an assessment after the deadlines have gone
A discretionary process for reopening an assessment where the IRS has information it has not previously considered. It is the main remaining route once the 90-day Tax Court window has passed.
THE CLOCK — NO DEADLINE, BUT THE COLLECTION PERIOD IS NOT SUSPENDED
A request can be made at any time while the balance is unpaid and the collection period is open. Filing one does not stop collection, so where a levy is in prospect, the collection side needs handling in parallel rather than afterward.
When it applies
Four situations account for most reconsideration requests.
A substitute return was assessed and the actual return, with its deductions and its basis, has never been considered. An examination was conducted by mail to an address you were not at, and the adjustments were made without your records. Records existed but were not supplied in time, often because of illness, a move, or a preparer who did not pass the letters on. Or the assessment is plainly wrong — a duplicate, an amount belonging to someone else, a period already paid.
It does not apply where you simply disagree with a conclusion the IRS reached on evidence it did consider. That is what Appeals and the Tax Court were for, and reconsideration is not a second attempt at the same argument.
It also does not apply where the tax has been paid in full. That becomes a refund claim, which has its own deadlines.
What a request has to contain
Information the IRS has not previously considered. That is the entire test, and it is why a well-supported request works and a strongly worded one does not.
So the package is: a covering letter identifying the periods, the assessment and precisely which adjustments are disputed; a copy of the examination report or the notice showing the changes; the documents that address each disputed item; and, where a substitute return is involved, the completed original return.
Address the items one at a time, in the order the report lists them, stating for each what the IRS concluded, what you say is correct, and which enclosed document establishes it. Reconsideration requests are worked by someone reading a file, and the ones that succeed are the ones that can be followed without reconstruction.
REASONS REQUESTS FAIL
- Nothing new is supplied — the same position, restated more firmly
- The disputed items are not identified against the examination report
- Documents are enclosed without explaining which adjustment each one answers
- The tax has already been paid, so the correct instrument is a refund claim
- The issue was already decided by the Tax Court, which reconsideration cannot revisit
Collection does not stop
This is the practical trap. A pending reconsideration request is not an appeal and does not suspend collection. Levy authority, if the final notice has been issued, remains available throughout.
In some cases collection is held while a request is being worked, but that is a discretionary courtesy rather than an entitlement, and it has to be asked for.
So where enforcement is close, the two tracks run together: the reconsideration package to correct the amount, and a collection alternative or a hold to manage the exposure while it is being worked. Sending the package and waiting is how people end up with a levy against a balance that was about to be reduced.
If it is refused
The outcome can be appealed to the Independent Office of Appeals, and that is often where these cases actually resolve — Appeals weighs the hazards of litigation, which gives a documented but imperfect case somewhere to go.
Beyond that, the remaining route is payment followed by a refund claim, and if that is denied, a suit in a district court or the Court of Federal Claims. That is a real option for a substantial amount and an expensive one for a small balance.
Which is the argument for engaging with an examination while it is open. Every route after a deficiency notice is narrower, slower and more discretionary than the one that was available before it.
Where this comes from
The statutes behind this page, so you can check any of it rather than take it on trust.
- IRC §6404(a)
- Permits abatement of an assessment that is excessive, imposed after the period of limitation, or erroneously or illegally assessed.
- IRC §6020(b)
- The substitute for return authority — reconsideration is the ordinary route for correcting one after assessment.
- IRC §6511
- Where the tax has already been paid, the route is a refund claim with its own deadlines rather than reconsideration.
This page explains what the IRS or the Massachusetts Department of Revenue does and cites the statute. It is not advice about your situation, which depends on facts none of this knows. Tell us what your letter says and what date is on it. Please do not send Social Security numbers or tax documents through the form.
Unfiled tax returns
Almost every serious collection case has unfiled periods behind it. Nothing else can be resolved until they are in — and the returns the IRS prepares in your place are, by design, the worst possible version of your tax position.
Notice of Deficiency
The letter that ends the administrative stage. It carries the only window in which you can have a court decide the amount before paying it, and that window is statutory.
Audit and examination letters
Most examinations are conducted entirely by mail about a single line on a return. The letter number tells you which kind you have, and that determines almost everything about how it should be handled.
Notice CP2000
An automated comparison found income reported to the IRS that does not appear on your return. The proposed tax is frequently much larger than the correct answer, because the computer does not know what anything cost you.
Questions about audit reconsideration.
- Is there a deadline for reconsideration?
- No fixed one. It is available while the balance remains unpaid and the collection period is open. Once the tax is paid, the instrument changes to a refund claim, which does have deadlines.
- Will collection stop while it is considered?
- Not automatically. A hold can sometimes be arranged, but it is discretionary. Enforcement exposure has to be managed separately and at the same time.
- The IRS filed a return for me. Is this the right route?
- Yes, and it is one of the most productive uses of it. Filing the actual return with expenses, basis and correct status, submitted as a reconsideration package, frequently reduces the assessment substantially.
- I disagree but I have no new documents.
- Then reconsideration is unlikely to help, because the test is information not previously considered. Where the assessment followed a deficiency notice that was never petitioned, the realistic remaining route is payment and a refund claim.
- How long does it take?
- Months. Correspondence processing is slow and a second notice arriving does not mean the request was rejected. Keep a complete copy of everything sent, with dates.
Tell us what the letter says and what date is on it.
Scope and price in writing before anything starts. Where what you need is something we do not do, you will be told that instead.
Please don't send Social Security numbers or tax documents through this form.