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Challenging a Bad Tax Assessment at the Collection Due Process Hearing

Education & Training with Tax Rep LLC

We frequently have taxpayers arrive in our office with collection notices for an IRS balance due that they believe they do not owe.  Whether due to not receiving the notice of proposed changes (CP-2000), or because they submitted records that were ignored by the IRS, these taxpayers are now facing balances with penalty and interest they should not have to pay.

More often than not it is the Final Notice of Intent to Levy and Your Right to a Hearing (CP-90) that gets them to act and contact us.  Other times it is the Notice of Federal Tax Lien being filed that triggers the response. 

In either case, the first move is always to request the Collection Due Process hearing (“CDP”) and prepare for the hearing.  This will prevent any levy from being issued and allow us to work out a collection alternative with the Appeals Officer, also known as a Settlement Officer.

The issue is can we raise the assessment as an issue at the CDP hearing?  The answer is ‘maybe’.

In order to challenge the underlying liability at a CDP hearing the taxpayer must be able to show that he or she did not have a prior opportunity to challenge it.  Meaning, they can show in the administrative record (which you can obtain from a Freedom of Information Act Request) they never received the Notice of Deficiency and therefore did not have a prior opportunity to challenge it.

If the taxpayer is unable to show this, the Settlement Officer will not consider the liability issue.  AT that point it is best for the taxpayer to enter into some sort of collection alternative and file an independent challenge to the liability, either audit reconsideration or a doubt-as-to-liability offer.

If you or someone you know has a tax issue and needs help, please feel free to contact me either at egreen@gs-lawfirm.com or at (203) 285-8545.

Eric L. Green, Esq.

Green & Sklarz LLC

1 Audubon Street, 3rd Floor

New Haven, CT 06511

(203) 285-8545



Posted by

Michael Elliott
Fathom Realty - Burlington Township, NJ
Burlington, New Jersey Residential Sales

One more reason why everyone needs a tax pro in their corner!   Great info.  

Apr 21, 2024 06:30 AM