What Happens After an IRS Audit Assessment?
The Audit Is Over—Now What?
If you’ve received an IRS audit assessment—whether by mail, in person, or via IRS Letter 525 or 531—it means the IRS has finished their review and decided you owe additional tax.
But just because the IRS says you owe doesn’t mean you’re out of options. What you do right now determines whether you can challenge the result, settle your debt, or stop the IRS from pursuing enforced collection like garnishments and levies.
Let’s walk through exactly what happens after an IRS audit assessment—and how to protect yourself.
Step 1: Review the Audit Assessment Notice
After an audit, the IRS sends one of the following:
- Letter 525 – Proposed changes; you have 30 days to respond
- Letter 531 – Notice of deficiency (final determination); you have 90 days to petition Tax Court
- Form 4549 – Report of Examination Changes
This documentation explains what the IRS changed, how much tax you owe, and what penalties and interest have been added.
Related: Tax Transcripts – Why They Matter
Step 2: Decide Whether to Dispute the Results
You have limited time to challenge an audit assessment:
- 30 days to appeal if you received a Letter 525
- 90 days to petition U.S. Tax Court after a Notice of Deficiency (Letter 531)
If you disagree, you should act before the IRS finalizes the balance. Once finalized, your options become more limited.
Related: What If You Missed the Deadline to File Your IRS Offer in Compromise?
Step 3: If You Agree with the Assessment
If you agree with the IRS findings, you can:
- Pay the balance in full
- Request an Installment Agreement
- Explore other resolution options, such as Offer in Compromise
Even if you agree, you can often request penalty relief or submit supporting documents to reduce the amount due.
Related: Why the IRS Rejected Your Offer in Compromise
Step 4: Prepare for IRS Collections
Once the balance is assessed and final:
- The IRS will issue a CP14 notice (first bill)
- If unpaid, you’ll receive CP501, CP503, and possibly CP504 (final warning)
- If still unresolved, the IRS may issue Letter 1058 and start enforced collection
That includes IRS Wage Garnishment, Bank Levies, and Tax Liens.
Step 5: Choose Your Resolution Path
Your strategy after an audit assessment depends on your financial picture:
| Option | Use When |
|---|---|
| Offer in Compromise | You can't afford to pay full balance |
| Installment Agreement | You can pay monthly over time |
| Currently Not Collectible | You're facing hardship and can’t pay |
| Appeal or Tax Court Petition | You disagree with the audit results |
We Help Orange County Taxpayers After IRS Audits
At Boulanger CPA and Consulting PC, we represent clients at every stage of the audit process:
- Reviewing audit reports and defending your rights
- Filing appeals or Tax Court petitions
- Preventing levies and enforced collections
- Negotiating settlements or affordable payment plans
Call (657) 218-5700 or book online at www.orangecounty.cpa
We’re local, experienced, and ready to help.
Frequently Asked Questions
Can I appeal an audit after the IRS says I owe more?
Yes—but only within strict timeframes (30 or 90 days, depending on the notice).
What happens if I don’t respond to the audit report?
The IRS finalizes the balance and can begin collections—up to and including levies and liens.
Can I still get an Offer in Compromise after an audit?
Yes. You may qualify even after assessment if you meet the IRS financial criteria.
Will interest and penalties continue after the audit?
Yes—until the full balance is resolved or settled.
📣 About the Author
Marc Boulanger, CPA is the founder of Boulanger CPA and Consulting PC, a boutique tax resolution firm based in Orange County, California and trusted by high-income individuals and business owners across Southern California.
With over a decade of experience resolving high-stakes IRS and State tax matters, Marc brings strategic insight to complex cases involving wage garnishments, bank levies, unfiled returns, and six-figure tax debts. He is known for helping clients reduce or eliminate tax liabilities through expertly negotiated settlements and compliance plans.
Marc is a Certified Public Accountant licensed in California and Oklahoma and holds the designation of Certified Tax Representation Consultant. He is a member of the American Society of Tax Problem Solvers (ASTPS) — the national organization founded by the educators and practitioners who have trained thousands of CPAs, EAs, and tax attorneys in IRS representation strategy.
Every case is handled with discretion, proven methodology, and direct CPA-led representation — not call center scripts.
📍 Learn more at www.orangecounty.cpa or call (657) 218-5700.
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