Letter 525, General 30-Day Letter

Form 4549, Report of Income Tax Examination Changes, a report showing the proposed adjustments to your tax return, will be enclosed with the letter. Generally, Letter 525 is issued if your audit was conducted by mail and Letter 915 is issued if your audit was conducted in person. These letters and the enclosed reports should identify the specific items the examiner is proposing be adjusted and provide an explanation as to why these adjustments are being proposed.

You are receiving a 30-day letter because the IRS completed an examination of your tax return, after reviewing the information you provided. The examination resulted in a determination that changes to your tax return are necessary. The examiner’s proposed changes will affect the amount of tax you owe or, perhaps, the credits you claimed. The 30-day letter is your opportunity to review these changes and determine if you agree or disagree with the changes proposed.

Letters 525 and 915 outline your options should you not agree with the proposed adjustments. If you agree with the adjustments, you sign and return the agreement form. If you do not agree, respond to the IRS by the due date on the letter. This could include sending additional documentation or an explanation to support your position. If you need more time to submit your response, call the number on the letter before the due date to ask for additional time.

If the examiner still proposes a change to your tax return, you can request an informal conference with the examiner’s manager prior to the response date in the letter. If you still disagree, you can request a conference with the IRS Independent Office of Appeals (Appeals) prior to the date in the letter. Make this request in writing and include your reasons for disagreeing with the IRS. You may be able to use Form 12203, Request for Appeals Review if the proposed assessment including tax and penalties for each tax period is $25,000 or less. Generally, you must request an Appeals conference within 30 days from the date of your letter to be given consideration. Review the procedures for appealing an IRS determination as outlined in Publication 3498, The Examination Process, or Publication 3498-A, The Examination Process (Examinations by Mail), to ensure that your request for an Appeals conference meets any requirements specified.

The IRS may disallow what you claimed on your return and issue a Notice of Deficiency, Letter 3219 (if your audit was conducted by mail) or Letter 531 (if you had an in-person audit). This legal notice gives you 90 days to petition the United States Tax Court (you have 150 days if the notice is addressed to a person outside the United States).