When it comes to negotiating with the IRS, the most prepared representatives can fail. It could be because they are unable to present the facts and law properly while maintaining a professional relationship at all times. There’s no easy shortcut for the case presentation and preparation to the IRS. Continue reading this post and know what to consider for negotiating with the IRS.
When you consider negotiating with the IRS, good preparation and presentation are key. It comes through experience in handling the IRS and the knowledge of tax laws and IRS procedures. Here are a few important things you should keep in mind while negotiating with the IRS.
Focus on common sense
It’s better to use common sense while dealing with the IRS.
Communication is key
It’s necessary to communicate with the taxpayer and the IRS. Feel free to ask many questions of the taxpayer and the IRS. If you don’t know something, it’s wise to ask questions by using why, what, when, etc.
Preparation is important
You should develop the facts and apply the law realizing that much of the law is open to interpretation. Before negotiating with the IRS, you must be fully prepared.
Consider the interaction
Take time to determine who you are working with and their supervisor as well as any specialists and their managers so that you know who they are, where they are located and their role. Research them online. Learn all you can about them and look for areas where you can connect to try and build a positive, authentic relationship. When you work on developing a connecting relationship, listen to them first without judgment. Really listen. Then be prepared to educate them the way they want to be educated.
Consider presenting the information
After you are done with the preparation, you should determine how to present the information. There are different factors that you should consider to determine how to present the information.
You have to review and control the information provided to the IRS. When the IRS receives the information, the IRS starts accumulating more information to try and assess the correct amount of tax and at times uses the information against the taxpayer. You need to be well organized, always honest, and well prepared before you start negotiating with the IRS.
Avoid volunteering information unless it will help your position. You should never lie to or mislead the IRS. Instead, present the information of the taxpayer to the IRS in a straightforward and forthright manner.
Get a plan of action ready
You should have a good plan of action for the negotiation. You should know how you want to proceed and what you want to ask while dealing with the IRS. You should understand the options available and look for alternatives. Prepare yourself to make the necessary changes. You should be open-minded.
Meet and start negotiating with the IRS
The first meeting will be the most important one. Avoid negotiating over the phone if possible as there are many misunderstandings, and it is easy to say no to the other party when negotiating over the phone.
You should be friendly, prompt, and ready. More often, people treat IRS employees with a hostile attitude. It’s better to treat IRS employees the way you expect to be treated.
You have to be confident, positive, and ready to develop your credibility with IRS employees. Always stay focused, be honest, and never mislead them. You want to present to the IRS employee that you are a competent tax professional and cooperative.
It’s not good to argue and you should avoid disagreement. If possible, you should avoid an adversarial relationship.
Feel free to ask about the statutes and regulations supporting the IRS position. You should avoid rejecting the position of the IRS; instead, consider reframing their position in your favor. Do not commit early. Remain flexible and open.
If you made a mistake, admit it and work to correct it timely.
You should be persistent.
Be persistent. If you cannot agree you may need to elevate in management or take the case to Appeals.
Bottom Line –
Instead of negotiating with the IRS yourself, consider getting help from a professional negotiator with years of experience and expertise in handling negotiations.
Author Information –
This article is written by Michael Gregory Consulting, which specializes in providing necessary help and assistance during negotiations with the IRS on audits in general and valuation in particular.
