IRS Audit Attorney

With more than a decade of legal, business, and tax experience, the team at Milikowsky Tax Law is on hand to help defend your business in an IRS audit.

There are few things more threatening to a business owner than a letter from the IRS.

An audit can be a time-consuming process. While you cannot avoid a tax audit, you can minimize your risk of an audit by avoiding potential flags on their tax return. The most frequent IRS audits are caused by inconsistencies or errors in your tax return that raise red flags in the eyes of the IRS.

When you work with Milikowsky Tax Law, you get more than an experienced tax litigation attorney. You get an experienced business and tax advisor who can work with you to reduce your chances of being audited, with our comprehensive tax return assessment system and years of business experience.

California’s Top IRS Audit Attorney

Our leading tax litigation attorney, John Milikowsky, has decades of experience representing countless businesses in legal tax matters. Mr. Milikowsky is dedicated to relentlessly defending his clients in everything from state and federal tax audits to criminal tax investigations. As a full-service tax law firm, we frequently work with business owners to empower owners to identify issues on their own tax returns. While there is no way to guarantee you will avoid a tax audit, we can teach you to significantly minimize your risk of an audit.

Get Expert IRS Audit Defense Today


Milikowsky Tax Law Defends Businesses in IRS Audits

When you’re faced with the formidable presence of a tax audit, don’t panic. Reach out to Milikowsky Tax Law, and we will protect your company to keep your business in business. Our skilled tax litigation attorneys will protect your rights every step of the way.

Whether you’ve just received a letter from the IRS, or you need help analyzing your legal rights and financial data reported on your tax returns, contact us today. The team at Milikowsky Tax Law is here to help.

San Diego Tax Attorney – Your Relentless Advocate in IRS Audits

Business owners may not be sure where to start if IRS audits their company. However, an IRS audit doesn’t have to overwhelm your life or impede your ability to conduct business. With the experienced team at Milikwosky Tax Law, you can navigate the process of an IRS audit secure in the knowledge that your tax attorneys are advocating for you every day.

There is little to no margin for error during an audit, a tight timetable, and potentially severe consequences for a poorly handled interaction with IRS. Unlike CPAs who do not have attorney-client privilege, attorneys are able to speak with your IRS officer on your behalf without risk of subpoena or summons of records discussed.  A qualified attorney can, review your documents with an expert eye, create the right strategy for you, represent you or your business, and provide valuable advice and guidance.

If you receive a letter from IRS confirming your business tax return has been selected for examination, review your return and identify the items that will likely be investigated so you can be prepared. Then, before communicating with IRS, reach out to an experienced IRS audit attorney. Having a game plan is critical. You want to be honest and prepared when speaking with your IRS revenue agent.

Anytime you file taxes, there is a chance that your tax return might be audited by the Internal Revenue Service (IRS). The agency conducts standard procedures to find any errors or discrepancies among taxpayers. The audit process is meticulous and, should you find yourself under the scrutiny of IRS, will require detailed information from you. 

In the article below, you’ll learn about the audit process and frequently asked questions surrounding IRS audits.

Why was I selected for an IRS Audit?

There are different reasons you may be flagged for IRS audits. Some are due to random checks; however, you have a low chance of being audited this way. Most taxpayers have less than a 0.6% chance of receiving a random audit check. 

IRS runs tax returns through its Discriminant Information Function (DIF) system to continually update their database and make sure they are tracking industry benchmarks for each industry and tax bracket. 

The DIF system also checks for incorrect tax filing information. Any discrepancies in tax forms, such as an imbalance of tax returns, a discrepancy between reported earnings and employer filings, or unreported cash transactions by one member of a transactional party, will trigger DIF to send your return to an IRS audit officer. 

People are more susceptible to an audit if they:

  • Earn less than $25,000 or more than $500,000
  • File incorrect or incomplete returns 
  • Have large numbers of cash transactions 
  • Claim a disproportionate number of deductions 
  • Are self-employed
  • Have a home-based business
  • Have a cash business 
  • Have foreign assets 

Sometimes you can be audited as a result of your business partners or investors going through an audit. 

How Will I Know If I am Selected for an Audit?

You will know if you are selected for an audit if you receive a verified letter in the mail from IRS. They do not call to notify you about your audit. 

What Do I Do If I’m selected for an Audit?

If you or your business are selected for an audit, make sure you read all of the information sent to you in your audit notification letter.  The letter and accompanying information request packet will notify you as to what entity is being audited (business or personal) what year(s) are under review and who your auditor is. Once you know what IRS needs, make sure you collect all of the records and supporting documentation requested (but nothing additional). You will need to submit records from banks, vendors, and businesses you have worked with, invoices and pay stubs, payroll records, and medical expenses among other information.

Should I Hire an IRS Tax Attorney to Help Me?

We suggest contacting a qualified tax attorney to help guide you through your audit, to ensure you are timely, responsive, compliant, and do not unintentionally increase the scope of your audit to other areas of your business or personal finances that would otherwise remain unscrutinized.. There is little to no margin for error during an audit, a tight timetable, and potentially severe consequences to a poorly handled interaction with IRS. Unlike CPAs who do not have attorney-client privilege, attorneys are able to speak with your IRS officer on your behalf without risk of subpoena or summons of records discussed.  A qualified attorney can, review your documents with an expert eye, create the right strategy for you, represent you or your business, and provide valuable advice and guidance. 

How long do I have to reply to an IRS audit?

You have 30 days to reply to the initial audit letter. Do not hesitate, and make sure you take the appropriate steps early on. IRS is not likely to provide extensions unless you have a good reason.  Your attorney can help by advocating for more time with the IRS agent.  A good attorney will know many of your local IRS auditors and have strong relationships built on well-structured prior cases and mutual respect. 

How Long Do Audits Take?

The time it takes to conduct an audit depends on the case. It fluctuates depending on:

  • The seriousness of the tax reporting error
  • When and whether the right information is provided to IRS
  • Communication between the person being audited and IRS officer

How Many Years of Tax Returns Can IRS audit?

IRS audits tax returns from the past three years; however, most are from the past two years. Only when IRS agents find discrepancies within the audit they are conducting do they dig for information older than three years. Most audits do not look for information past six years. Though in cases of criminal audits IRS can look back 9 years and longer. 

If you or someone you know received an audit letter from IRS, reach out to our expert team at Milikowsky Tax Law. We have over a decade of experience working with IRS and tax audits and are experts in defending business owners in the face of IRS or other government agency audits. 

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How to Appeal an IRS Audit in 2025: A Step-by-Step Guide

Calculator and the word tax representing How to Appeal an IRS Audit in 2025

Facing an IRS audit can be daunting, especially when the results aren’t in your favor. If you’ve received an audit determination and want to challenge it, the process of filing an appeal is crucial. 

John Milikowsky, Founder of Milikowsky Tax Law, dives into all the details in the video below:

Key Takeaways:

  • Submit your protest letter before the audit closes to avoid a tax court situation.
  • Your protest letter must be signed under penalty of perjury and include a clear summary of disputes.
  • Provide supporting evidence, like bank statements or loan documents, to back up your claims.
  • If necessary, the case will be sent to IRS Appeals for further review, which may lead to a more favorable resolution.
  • If appeals don’t go in your favor, you still have the option to appeal to tax court, but you must act within strict deadlines.

In this blog, we’ll walk you through the steps of appealing an IRS audit in 2025, so you can understand your options and take proactive action to safeguard your financial interests.

1. Understand the Appeal Process

The first thing to know is that an appeal can only be made before the audit closes. Once the audit is concluded, you’ll receive a Notice of Deficiency, which essentially serves as your ticket to tax court. However, if you are still in communication with a revenue agent, you have the opportunity to file an official protest letter before the audit is finalized.

2. Drafting the Protest Letter

The protest letter is your official response to the IRS’s findings, and it must be submitted before the audit closes. To help you navigate this, here’s what your protest letter should include:

  • Signature Under Penalty of Perjury: The letter must be signed and stated under penalty of perjury to certify that the facts and information in your letter are true and correct.
  • Summary of Disputed Issues: Clearly summarize all the issues you are disputing, referencing the Revenue Agent Report. This report typically outlines the balance due, taxes owed, and any additional penalties and interest.
  • Evidence and Supporting Documents: If you’re disputing certain findings, like additional income or disallowed deductions, you must provide evidence. For instance, if you disagree with the IRS’s claim of unreported income, provide the necessary bank statements, promissory notes, or loan documents that explain the discrepancies.

3. Addressing Specific Issues

One common audit issue involves discrepancies in reported income. The IRS often conducts a bank deposit analysis and may identify unreported income based on unexplained deposits in your bank accounts. If this applies to you, follow these steps:

  • Bank Statements: Provide detailed bank statements that support your claims.
  • Explain Unexplained Deposits: If you borrowed money from a relative or received funds that weren’t income (like a loan), make sure to provide supporting documentation. A simple promissory note or a copy of the loan transaction can help clarify the situation.

By itemizing your issues and providing supporting documents, you are showing the IRS that you are serious about challenging their findings with credible evidence.

4. Submit Your Protest Letter Before the Deadline

Once your protest letter is drafted, submit it to the revenue agent before the deadline stated in the IRS’s communication. If you need more time, you can request an extension from the agent. However, missing the deadline will result in the audit being closed, and you will receive a Notice of Deficiency.

Make sure to confirm receipt of your protest letter with the IRS, either by fax or mail. Communication is key at this stage.

5. IRS Appeals: The Next Step

Once your protest letter is submitted, the case will be sent to IRS Appeals. Here, an appeals officer will review your evidence and the findings from the revenue agent. You will receive either a letter or a phone call from the appeals officer, confirming that they are reviewing your case. If any new information is provided during the appeals process, it will likely need to be sent back to the original revenue agent for analysis.

The goal of the appeals process is to determine whether the IRS agent’s findings were justified, based on the information you’ve provided. If the appeals officer agrees with your position, they may overturn the findings, potentially saving you from a higher tax bill.

6. The Appeals Decision: What Happens Next?

Once the appeals officer reviews your case, they will make a final determination. If the officer agrees with you, the case will be resolved, and you’ll avoid further legal action. However, if the appeals officer disagrees with your position, you have the option to appeal to tax court—but keep in mind that there are strict deadlines for taking this step.

While the appeals process is less costly and quicker than going to tax court, if you still disagree with the IRS’s decision, tax court is the next route.

Get Help with your IRS Audit Today

Appealing an IRS audit may feel overwhelming, but knowing the steps involved can help you navigate the process with confidence. By preparing a well-drafted protest letter, gathering supporting evidence, and working closely with the IRS appeals officer, you can increase your chances of resolving the issue before it escalates further.

At Milikowsky Tax Law, we specialize in helping individuals and businesses through complex tax matters, including audits and appeals. If you find yourself in the middle of an audit, contact us today to discuss your options and ensure you’re taking the right steps to protect your financial future.