Generally, different assessments can be appealed at different times. Below we will list these assessments and when they can be appealed by a taxpayer.
The following penalties can be appealed by a taxpayer prior to assessment by the IRS:
1. Penalties asserted by the IRS in the course of examining a taxpayer’s return. This is generally considered the accuracy related penalties subject to the deficiency assessment procedures.
2. Trust fund recovery penalties and preparer penalties.
3. Intentional disregard penalty when it is asserted for failure to comply with the cash reporting requirements of IRC Sec. 6050.
For penalties that have been proposed by an examiner, the taxpayer can request a review of the examiner’s findings. If an agreement cannot be reached at this level in the appeal, the IRS will mail the taxpayer a 30 day letter explain that the taxpayer has 30 days to request administrative appeal with the Appeals Office.
Once a penalty has been assessed by the IRS, the taxpayer can appeal the assessment with the post-assessment penalty appeal program. This program usually deals with penalties involving abatement for reasonable cause or due diligence. This program will deal with any of those penalties except:
1. Penalties subject to an administratively granted pre-assessment appeal
2. Penalties subject to deficiency assessment procedures
3. The Section 6695 preparer penalties
4. The Section 6672 trust fund recovery penalty
A second form of post-assessment appeal is for the taxpayer to pay the tax and claim a refund using either Form 843 ( Claim for Refund and Request for Abatement) or Form 6118 ( Claim for Refund of Tax Return Preparer and Promoter Penalties).