Audit Reconsideration vs. Amended Return: Different Procedures for Different Problems

Audit reconsideration and an amended return are not interchangeable. The correct procedure depends on whether the IRS has already examined and assessed the issue, whether the taxpayer had a prior opportunity to participate, whether new information exists, whether a refund is sought, and whether an administrative or judicial deadline is still open.

What Audit Reconsideration Does

Audit reconsideration is an administrative process through which the IRS may reevaluate an examination assessment. It is commonly requested when the taxpayer did not appear for the examination, moved and did not receive correspondence, or has records that were not previously considered. It generally is unavailable after the liability has been fully paid, after a final court decision, or after a closing agreement or compromise resolved the issue.

What an Amended Return Does

An amended return reports a change to a previously filed return. It may report additional tax or claim a refund or credit. When the issue has already been examined and assessed, simply filing an amended return may not route the matter through the correct reconsideration or refund-claim process. Refund claims also have statutory filing deadlines and may require payment before a refund suit can proceed.

Do Not Use Either Procedure to Miss a Live Deadline

A pending examination, 30-day letter, notice of deficiency, Appeals deadline, Collection Due Process deadline, or refund-disallowance notice may create rights that are lost if the stated deadline expires. An audit-reconsideration request or amended return generally does not suspend a Tax Court petition period or automatically stop collection.

Documentation and Scope

A reconsideration package should identify the examined year and issues, explain why the information was not previously considered, include organized supporting records, and reconcile the requested change to the examination report and account transcript. An amended return should explain each change and include the schedules, statements, and basis for the revised treatment.

This article provides general federal tax information. Before choosing a procedure, review the examination history, assessment, payments, notices, transcripts, statute dates, prior agreements, and current collection posture.