What This Letter Means

You asked for an Appeals conference after an IRS examination. Letter 1025B is the protest letter the examiner uses when the audit result is a no-change with adjustments: your tax didn't change, but items on your return did. The examiner sends it for one of two reasons.

  • Your protest is incomplete. Your formal written protest or small case request doesn't contain everything Publication 5 requires. The examiner returns it and gives you additional time to complete it.
  • Appeals needs a statute extension. There isn't enough time left on the assessment statute of limitations to send the case to Appeals, and the IRS already asked you to extend it. The letter reminds you that a consent is needed and gives you 10 days to respond.

What a Complete Protest Includes

A formal written protest states that you want to appeal the changes and includes:

  • Your name, address, and a daytime phone number.
  • A list of every disputed issue, the tax periods involved, the proposed changes, and the reasons you disagree.
  • The facts supporting your position on each issue, and any law or authority that supports it.
  • A penalties of perjury statement, signed by you or your representative. A representative uses a statement that says whether they personally know the facts are true.

Adequacy isn't about whether the examiner agrees with you. It's about whether the required information is there. Citing a Code section with no reasons and no supporting facts isn't enough. Saying only that you can't pay isn't enough either. On a joint return, a protest signed by only one spouse is not incomplete for that reason alone.

Appeals generally needs time left on the statute before it takes a case. If you choose not to extend the date, Appeals will not accept your case. Weigh that decision carefully before the 10 days run.

What to Do

  • Read the letter closely to see which problem applies.
  • Send the completed protest or your answer on the consent by the date in the letter.
  • Keep a copy of everything and proof of when you mailed it.

You can authorize a representative to handle this with Form 2848. Missing the date can cost you the chance to have Appeals review the audit.

If you received Letter 1025B and want your appeal handled correctly, call us at (813) 229-7100.