Can someone help me write a letter to the IRS regarding the doing an audit reconsideration?

Question

We were being audited on our 2005 taxes. I asked for a couple of extensions in getting them all of the paperwork they asked for and I finally sent them everything by certified mail in the middle of March. I just got a letter from them stating they closed my case on April 3rd and they took out $6,900 out of this year's tax return. They never even reviewed any of the paperwork I sent to them. I called the IRS and they told me to send a letter asking for an audit reconsideration. Does anyone have any suggestions for what to write?

Answer 1

In order for the IRS to knock out $6900, it would appear you lost 2 dependents and were denied EIC.

What relationship were these dependents to you?  What proof did you have that they were living with you?  Why weren't their parents' claiming them?

Answer 2

Heres a publication on the process. http://www.irs.gov/pub/irs-pdf/p3598.pdf

In order to write the letter one would need to know the situation that is occurring and provide adequate documentation.

Answer 3

Honestly, you are in over your head already.  You should have contacted an accountant, attorney, or someone with tax knowledge when you were originally told you were being audited.  You made things worse by delaying.  Now, you are in the end stage of audit reconsideration.  Not getting professional help now is like being sentenced to 20 years in jail an still not contacting an attorney to help you with your appeal.  Do you want to win or don't you?

Sometimes it is a good thing to by thrifty, like buying day-old bread or going to a matinee instead of the later showing, but when it comes to IRS audits, do-it-yourself or asking Yahoo!Answers is not the best solution.  Either give them their money or hire someone competent....but only do the latter if you are confident that the IRS is wrong and you are correct.  If you tried to pull a fast one on the IRS and they caught you, it is better to pay up and l**k your wounds.  If you truly don't understand why you were audited or why you lost, call the representative on the correspondence during normal IRS hours and ask for a detailed explanation.

extra: I like VB's answer.  I was thinking the same thing.  A lot of people claim children for Earned Income Tax Credit (EITC) who don't really qualify.  People sometimes trade children like cards in a deck...'you claim him and I'll claim them'.  The laws are complicated.  Basically, when you said "we", I imagine you are married filing jointly.  What relationship are the children you are claiming to you or to your husband?  Could someone else have claimed them?  Did they live with you during 2005 for over half of the year?  Were they under 19?  The link I have below is a good way to tell if you can claim the EITC.  If the audit doesn't have anything to do with EITC, I'm sorry for all this extra stuff.  I knew a single guy who had a child who lived with him some time and with the child's mother some time.  Both he and the mother claimed the child for EITC.  The IRS asked for proof that the child lived with the father for over 6 months.  They wanted an affidavit, or medical records or school records.  The child was too young to be in school and didn't visit the doctor the whole year.  He ended up losing the case because the mother of the child had a valid affidavit.

Additional: You said, "When they calculated the $6,900 we owe them, they were including all of our real estate taxes, property taxes, medical expenses and my husband's work expenses."  If they included all of that, why do you still owe the $6,900?  Did you mean to say that they didn't include all of that, but instead just gave you the standard deduction?  I still think you should have hired someone...even if you went to an H&R Block office or something.  So what if it sets you back $500, it is better than $6,900.

Answer 4

Call the taxpayer advocate's office and see if they can help you

Answer 5

I agree with the others, except you don't need an attorney, and that would not be the best person to help you at this time. Get help from a CPA or other tax professional, to get to the bottom of this. Get an attorney if it comes to litigation.

Also, don't go to those people on TV who promise to get you a great deal from the IRS!

Answer 6

Your accountant has not been a lot of help to you.  Find another tax advisor and schedule an appointment.  Bring your tax returns and copies of all correspondence sent or received from the IRS.

Sometimes taxpayers are not clear as to what is a deductible medical expense.  Just because the bill was paid does not mean you have a deduction.  If the bill was paid by a third party, such as your health insurance, or another insurance company as from an automobile accident, you do not have a deduction.  The only medical expenses you can deduct are those that you paid using after-tax dollars.

Have your return reviewed by someone with a critical eye who can advise you of your best course of action, and who has the expertise to write a letter for you, or as your representative, if that is in your best interest.