Specific Types of Representation · Representing a Taxpayer in Audits/Examinations

Interpretation and analysis of Revenue Agent Report (RAR) (e.g., 30-day letter)

An unagreed examination produces a report and a letter. The report says what the examiner proposes; the letter says how long the taxpayer has to act. Together they are a clock, and the representative’s first task is three dates: when the response is due, when the assessment period expires, and how much of it will be left when Appeals receives the case. Two of the three are commonly missed.

The rule

Where the report comes from. An examination concludes as no change (“you have substantiated all of the items we reviewed”), agreed, or unagreed — the last two both beginning with proposed changes the taxpayer understands (Pub. 3498). The examination report sets out those proposed changes.

Before the letter. In an unagreed case “the examiner will explain your appeal rights.” The taxpayer “may request a meeting or telephone conference with the examiner’s supervisor,” and may request Alternative Dispute Resolution such as Fast Track Settlement. “If you reach an agreement, we will close your case” (Pub. 3498).

The 30-day letter. If no agreement is reached, “you will receive a letter (known as a 30-day letter) letting you know of your right to appeal the proposed changes. You generally have 30 days from the date of the letter to tell us whether you will accept the proposed changes or appeal them” (Pub. 3498). See the figures table.

What happens if nothing is done. “If you don’t respond to the 30-day letter, or reach a settlement with Appeals, then the IRS will send you a 90-day letter, also known as a notice of deficiency.” That is “a legal document that explains the proposed changes and the amount of the proposed tax increase and penalties,” and it starts the Tax Court petition period — see the figures table (IRC § 6213(a)). “If you don’t petition the Tax Court, you will receive a bill for the amount due” (Pub. 3498).

The two routes. Below the threshold in the figures table, a small case request: either “a brief written statement listing the disputed issues and why you disagree,” or Form 12203, Request for Appeals Review. Above it, a formal written protest — also required regardless of amount for employee plan, exempt organisation, partnership and S corporation cases (Pub. 5; Pub. 3498).

What a formal protest must contain. See the figures table (Pub. 5).

Where it goes. Mail the protest “to the IRS address on the letter that explains your appeal rights. Don’t send your protest directly to the IRS Independent Office of Appeals; this will only delay the process and may prevent Appeals from considering your case.” The originating office “will consider your protest and attempt to resolve the disputed tax issues” before forwarding it (IRS, Preparing a request for appeals).

The statute constraint on appealing at all. “If you disagree with the results of the examination, you can’t administratively appeal the disputed issues unless sufficient time is remaining on the ASED when … Appeals receives the case” — see the figures table (Pub. 3498).

Current figures

How it works in practice

Read the report issue by issue. It is a set of separable determinations, each separately winnable. A representative who responds to the bottom line rather than to the individual adjustments loses the merely-unsubstantiated issues — usually the ones a protest can still fix — along with the genuinely disputed ones.

The 30-day letter is not a bill and not a notice of deficiency. It is an offer of an administrative forum. Nothing has been assessed, nothing is owed yet, and the Tax Court is not yet available. That matters because the letter is what a taxpayer can safely let lapse only if they intend to litigate — letting it lapse forfeits the Appeals conference but not the Tax Court, since the notice of deficiency follows.

The supervisor conference comes before the protest, and it is free. Pub. 3498 puts the meeting or telephone conference with the examiner’s supervisor ahead of the appeal. It costs nothing, and on factual disagreements it resolves a material share of cases. So does Fast Track Settlement, where the issues are fully developed.

Check the ASED before choosing the route. Appeals will not take a case without sufficient time left on the assessment statute — generally a year — so a protest on a return whose assessment period expires in eight months does not buy a conference; it produces a request to extend the statute, or a notice of deficiency. Calculate the ASED at the same moment as the response date, and tell the client which constraint is really governing.

Never send the protest to Appeals. The instruction is explicit and the consequence is real: the protest goes to the IRS address on the letter, and the originating office reviews it first. Sending it to Appeals delays the case and “may prevent Appeals from considering” it.

The threshold is per tax period, and it aggregates the wrong way round. The small case route is available where the proposed change for each tax period is at or below the threshold. Where several periods are involved and any one of them exceeds it, a formal written protest is required for all periods. A representative who files a small case request across a three-year examination because two of the years are small has filed the wrong document for all three.

The perjury statement is not boilerplate, and it differs for the representative. Pub. 5 gives the taxpayer’s statement, and then two different statements for a representative filing the protest — one where the representative has personal knowledge of the information, and one where they do not. Using the taxpayer’s statement over a representative’s signature is a defect, and signing a personal-knowledge statement for facts the representative has only from the client is worse than a defect.

Facts and authority are separate requirements. The formal protest calls for the facts supporting the position on each issue and the law or authority supporting it. A protest that narrates the facts and closes with a general assertion that the examiner was wrong satisfies one requirement, and gives the Appeals officer nothing to settle against.

How this has changed

The office has a statutory name and a statutory mission. The Taxpayer First Act of 2019 renamed the Office of Appeals and established it by statute as the “Internal Revenue Service Independent Office of Appeals” (IRC § 7803(e)(1)). Material referring to the “Appeals Division” or “Office of Appeals” describes the same function under a superseded name.

The publications diverge on one element of the protest, and the more recent one is the shorter. Pub. 5 (Rev. 4-2021) lists five substantive elements plus the signature, including “law or authority, if any, supporting your position on each disputed issue.” Pub. 3498 (Rev. 5-2025) lists the same elements without the law-or-authority bullet. Nothing suggests the requirement was withdrawn — the IRS appeals page still directs taxpayers to Pub. 5 for how to prepare a protest, and Pub. 5 is the specific authority on protests. Include the authority. This page states Pub. 5’s fuller list, and the divergence is recorded rather than resolved silently.

Alternative dispute resolution is now part of the ordinary sequence. Fast Track Settlement appears in Pub. 3498 alongside the supervisor conference as a step before the formal appeal, with a 60-day resolution goal. A representative who treats the 30-day letter as a fork between “sign” and “protest” is missing the two cheaper options in front of both.

Note the revision dates. Pub. 3498 is Rev. 5-2025, Pub. 5 is Rev. 4-2021, and the IRS appeals pages relied on here were last reviewed 28 June 2026 and 16 April 2026.

Exam focus

Know that the 30-day letter offers an administrative appeal, that the response window is generally 30 days from the date of the letter, and that failing to respond produces a notice of deficiency, not an assessment.

Know the threshold dividing the small case request from the formal written protest, that it is measured per tax period, and that exceeding it in any period requires a formal protest for all periods.

Know that partnership, S corporation, employee plan and exempt organisation cases require a formal written protest regardless of amount.

Know the contents of a formal protest, including the penalties of perjury statement — and that a representative uses a different statement depending on whether they have personal knowledge.

Know that the protest goes to the address on the letter, not to Appeals.

Know that Appeals will not take a case without sufficient time remaining on the ASED.

Check yourself

1. A taxpayer does not respond to a 30-day letter. What happens next? (A) The tax is assessed immediately (B) The case closes as agreed (C) The IRS issues a notice of deficiency, starting the Tax Court petition period (D) The case goes to Appeals automatically Answer: C. The 90-day letter follows, and only after the petition period lapses without a petition does a bill issue.

2. An examination report proposes changes of $18,000 for 2023 and $40,000 for 2024. What must the taxpayer file to appeal both years? (A) Form 12203 for 2023 and a formal protest for 2024 (B) A formal written protest for both years (C) A small case request for both years (D) Form 9423 Answer: B. Exceeding the threshold in any tax period requires a formal written protest for all periods involved.

3. Where should a formal written protest be sent? (A) To the Independent Office of Appeals (B) To the IRS address shown on the letter explaining the appeal rights (C) To the Taxpayer Advocate Service (D) To the U.S. Tax Court Answer: B. Sending it directly to Appeals delays the case and may prevent Appeals from considering it.

4. An enrolled agent files a protest based entirely on the client’s records and statements. Which perjury statement applies? (A) The taxpayer’s own statement (B) The representative’s personal-knowledge statement (C) The representative’s no-personal-knowledge statement (D) None — a representative does not sign under penalties of perjury Answer: C. Pub. 5 gives two representative statements, and facts known only from the client are not the representative’s personal knowledge.

5. A 30-day letter arrives with seven months left on the assessment period. What is the practical consequence? (A) None — the protest tolls the statute (B) Appeals generally will not take the case without sufficient statute remaining, so the choice is a consent or a notice of deficiency (C) The IRS must abate the proposed tax (D) The taxpayer gets an automatic extension of the ASED Answer: B. Filing a protest does not create the time Appeals needs; the client must decide between extending and litigating.