I was billed before I could respond to a mail audit

I received a bill as a result of a mail audit. They asked me for information, but by the time I was able to get it to them, they billed me. What should I do?

This is known as a “correspondence” audit. Ideally, the information you send should match the information that’s in your tax return. Generally, if there’s a mismatch, or if there is a lack of information, the tax agency will send a request that you supplement the information or support what you’ve claimed in your returns. If you don’t respond in a timely fashion, they may just go ahead and assess you and send a bill.

You will be able to appeal this assessment if you do so in a timely manner. There are essentially two layers of appeals in this situation:

  1. IRS Appeals
  2. US Tax Court.

It’s delicate because there are forms (and filling in the forms correctly…) and deadlines involved. It’s always a good idea to have a professional assist you with this.