Crazy as it is, here it goes

I’ve been audited three times - 2 full, 1 specific audit 

Since the audits were in different political “eras”, the conclusions I draw may not be valid - but here goes.

Audit 1 - my enrolled agent representative and I concluded that the IRS has a very strong case.  They claimed I owed $6,000 (this was back in 1983) and I thought anything less would be a good outcome for me.  My rep asked if I was ready and able to write a check for any full settlement amount and I said I was.  Despite my rather weak case the IRS settled for $1,350.

Audit 2 - This time I was represented by an attorney.  The IRS claim I owed $5700.  I thought they had an air tight case for $4500.  I was elated to write a check for $750 as full payment.

Audit 3 - This one was a specific audit related to medical write offs as itemized deductions.  I had invoices, receipts, credit card statements, etc.  whatever I sent the IRS they claimed wasn’t good enough, and also came back with another requirements.  The final requirement was a statement from my wife as to the necessity of her (rather extensive) and uninsured medical procedures.  Since my wife had passed away 6 months prior to the IRS audit, I was unable to obtain the statement.  I got my attorney involved, and his conclusion was that the IRS was “stonewalling” and a lawsuit would be required, with all the inherent legal costs.  Since the amount claimed by the IRS was below the cost of a lawsuit (about $10,500), I decided to just write the check and go on with my life. 

So here’s my conclusion

The WEAKER the IRS case, the less they’re willing to negotiate.  Conversely, the stronger their case, the greater the “discount” they’ll accept.  Maybe someone who worked for a governmental agency can explain this to me?