IRS Audit Reconsideration: How to Request, Submit, and Appeal

IRS audit reconsideration is a request asking the IRS to take another look at a tax assessment from a closed audit, or from a return the agency filed on your behalf, when you have information the examiner never saw. It works after the tax has already been assessed and collection may have started, which is what separates it from a standard appeal. If you still owe the balance and you have new documentation, you can ask the IRS to reopen the case and adjust what you owe.

Who Qualifies to Request It

Two conditions matter more than anything else. You must still owe the assessed tax, and you must bring something new. If you have already paid the bill in full, reconsideration is off the table and your path is a refund claim on Form 1040-X. If you have not paid but you are only rehashing arguments the auditor already rejected, the IRS will not reopen the case. The request needs to point to documentation or information that was not part of the original examination.

Three situations permanently close the door:

You signed a Form 906 Closing Agreement, a Form 870-AD agreement with the Office of Appeals, or an accepted offer in compromise under IRC 7122. Those are final.¹
The U.S. Tax Court or another federal court has already issued a final determination on the tax for that year.²
For a partnership, the issue was already resolved through an IRS administrative adjustment or a partnership-level agreement.¹

Reconsideration is a different process from filing an amended return. An amended return corrects a return you filed. Reconsideration challenges the results of a completed IRS examination, and the two go to different IRS units on different timelines.

When It Makes Sense to Ask

The IRS recognizes four common reasons taxpayers request reconsideration:

You have new records, such as receipts, bank statements, or corrected Forms 1099, that the examining agent never reviewed.
You disagree with the income figures or filing status the IRS used in calculating what you owe.
You missed the audit appointment or never sent in the requested information.
You never received the audit report because the notice went to an old address, and only learned about the audit when collection notices arrived.

A large share of these requests involve a Substitute for Return, which is a return the IRS files when you have not filed one yourself. The agency uses only third-party income reports, so it cannot account for your deductions, credits, or filing status choices, and the resulting tax is almost always higher than a properly filed return would produce. If you want reconsideration in that situation, the standard move is to file your original delinquent return with all supporting schedules. The IRS treats that filing as the reconsideration request.³

How to Build the Request

This is where cases are won or lost. The IRS is not going to hunt for the connection between your evidence and the disputed items. You have to make it obvious.

Your submission should include:

A copy of the original audit report, usually Form 4549 (Income Tax Examination Changes), or the CP2000 notice if that is what you received. If you no longer have it, say so in your letter and provide as much identifying information as you can.
The new supporting documents themselves: bank statements, canceled checks, corrected Forms 1099, receipts for disallowed deductions, or anything else the IRS did not previously review. Send copies. The IRS does not return originals.¹
Your name, Social Security number, and the tax year on every page. Unlabeled pages get separated from case files.

The IRS offers Form 12661, Disputed Issue Verification, for this exact purpose. It has blocks where you list each adjustment you disagree with, and you number your supporting documents to match each block.⁴ Three disputed items, three completed blocks, exhibits numbered one through three. The form is not required. A detailed letter works too, as long as each disputed item is tied to specific new evidence.⁵ What does not work is a general statement that you disagree with the audit.

Where to Send It

Send your request to the IRS office that last corresponded with you about the audit. The correct address should be on your most recent audit notice or assessment letter. If you cannot find it, call 866-897-0161 or 866-897-0177 to get the right mailing address for your case.⁵

Mail, fax, and online submission are all options. The IRS Document Upload Tool at irs.gov/dut accepts electronic uploads once you enter your notice number or access code.⁶ If you mail, use certified mail with return receipt. A confirmed delivery date protects you if the IRS later says it never received the package.

What Happens After You Submit

Expect some kind of contact from the IRS within about 30 days, usually a letter acknowledging your request or asking for more information.¹ The full review takes longer, and complex cases can run several months.

Collection is the part that worries most people. The IRS has discretion to put a collection hold on your account, and often does once it confirms valid documentation is in hand. But a hold is not automatic. It will not happen in these situations:

You are already on an installment agreement. You have to keep making scheduled payments throughout the review.¹
Less than a year remains on the IRS’s collection statute expiration date.³
Your account is in certain collection stages, including assignment to a Revenue Officer or specific closed statuses.

Do not assume mailing the request freezes your account. If a levy or lien is active and you have not received written confirmation that collection is paused, call the IRS or the Taxpayer Advocate Service.

Interest, Penalties, and the Refund Clock

Interest keeps accruing while your reconsideration is pending. Even if collection is paused, the meter runs. If the IRS ends up upholding some or all of the assessment, you will owe interest going back to the original due date. Voluntary payments during the review period reduce the interest that piles up.³

If you think a refund may be waiting at the end, watch the refund statute. You generally have to claim a refund within three years from the date you filed the return or two years from the date you paid the tax, whichever is later. Miss that window and the IRS cannot issue a refund even if it agrees the tax was overpaid.⁷ This matters most for taxpayers who paid years ago and are only now contesting the assessment.

Accuracy-related penalties that were calculated as a percentage of the underpayment fall automatically when the underlying tax drops.⁸ Some manually assessed penalties, like the failure-to-file penalty, require a separate adjustment and may not update on their own.⁹ If the tax comes down but the penalty balance stays put, follow up and ask for the manual correction. Interest, by law, cannot be reduced unless the related penalty is reduced or removed.

Possible Outcomes

Reviews end in one of three places:

Full acceptance. The IRS agrees the new documentation supports your position, and the additional assessment is eliminated or substantially reduced.
Partial acceptance. Some disputed items are conceded, others are upheld, and the balance drops but does not disappear.
Full denial. The IRS finds the original assessment was correct and the new evidence does not change the result.

If the IRS Says No

A denial is not the end. You can request a conference with the IRS Independent Office of Appeals.² For disputes involving $25,000 or less in additional tax for any single tax year, Form 12203 (Request for Appeals Review) starts the process.¹⁰ Larger disputes require a formal written protest that lays out the facts, the applicable law, and your arguments.¹¹

You can represent yourself at the conference or bring an attorney, CPA, or enrolled agent. During the appeals phase, the IRS maintains a collection hold on your account, though interest and penalties continue to accrue on any balance due.³

Getting Help From the Taxpayer Advocate Service

The Taxpayer Advocate Service is an independent organization within the IRS. Assistance is free. Reach them at 1-877-777-4778 or through taxpayeradvocate.irs.gov. Three situations justify a call during a reconsideration case:

The disputed tax is causing serious economic hardship, such as an inability to pay for necessities.
You submitted everything the IRS asked for and months have passed with no movement.
An IRS process is not working the way it should and normal channels are not resolving it.

TAS cannot overrule the IRS on the merits, but it can push a stalled case forward, confirm your documentation reached the right unit, and intervene when collection continues despite an active review.¹

1
Taxpayer Advocate Service. Audit Reconsiderations
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Internal Revenue Service. Audit Reconsideration
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Internal Revenue Service. Internal Revenue Manual 4.13.1 – Examination Audit Reconsideration Process
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Internal Revenue Service. Disputed Issue Verification
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Internal Revenue Service. Audit Reconsideration Process for Correspondence Examination
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Internal Revenue Service. IRS Document Upload Tool
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Internal Revenue Service. Time You Can Claim a Credit or Refund
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Internal Revenue Service. Accuracy-Related Penalty
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Internal Revenue Service. 5.1.15 Abatements, Reconsiderations and Adjustments
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Internal Revenue Service. Request for Appeals Review
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Internal Revenue Service. Preparing a Request for Appeals