How to Respond to the '90 Day' IRS Letter aka Statutory Notice of Deficiency - IRS Publication 3598

Almost 99.9% of Notices of Statutory Deficiency can be settled with the IRS unless the time clock runs down resulting in a default tax judgement. IF you find yourself 'running out of time' on the 90 day period, filing a tax court petition and paying court fees and representing yourself pro-se or hiring a tax court lawyer are last choice decisions. They are costly and tax court I hate to say it usually favors the government. The best solution is to manage the IRS audit process early and often to obtain the BEST outcome.The problem with the 90 day letter is that it is an uphill battle to get the proposed assessment amount changed. If the amount in the 90 day letter is not correct, and you have the documentation and tax authority backing your position, IRS examination, appeals, and/or the general council will want to settle the case. The trouble is that by the time the average taxpayer does anything about the 90 day letter there may not be enough time left to arrive at a resolution with IRS examination. Subsequently if a tax court petition is not filed timely, the taxpayer's options become limited and resolution becomes potentially more expensive.EA or CPA, can assist the tax payer in tax court presuming the taxpayer is willing to act on their on behalf. If you go this route my suggestion is to go to tax court and sit in that room after calendar has been called and hear a proceeding.  This is a valuable experience. Filing a Tax Court Petition is ultimately a great tool in buying more time to prepare the necessary documents to prove the assessment should not take place. More than likely you will have 6 months before you even hear from an IRS Appeals Agent.