IRS Notice · Letter 525 · 30-Day Letter · Act

Letter 525: the 30-day letter, and the signature nobody explains

A Letter 525 transmits the IRS's examination report and opens a 30-day window to ask for the Independent Office of Appeals. This page covers what that window is for, what arrives if it closes, and the question almost nobody answers: why the examiner is asking you to sign an extension of the assessment period, and what happens if you don't.

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The report enclosed with this letter is a proposal, and the letter is an invitation to disagree with it. That is not a formality. Appeals is a separate office from the one that wrote the report, and reaching it costs a letter.

The window is short and the thing it opens is the last inexpensive door in this process. After it, the next document is a notice of deficiency and the venue becomes a court.

A thirty-day letter that lands on a Friday should not have to wait until Monday to be dealt with. (800) 236-3741 is answered 24 hours a day, seven days a week; after hours our AI receptionist answers the common questions, takes the date off your letter, and books the first available thirty minutes. Thirty minutes, free, no obligation and no conditions attached — and a CPA works the case, not a processing department.

Two minutes tonight, and they matter more than anything else here. Write down the date printed on the letter, and check whether a Form 4549 examination report came with it. Those two facts decide every option on this page, and both are free.

Key takeaways

•A Letter 525 is a 30-day letter: it transmits Form 4549, Report of Income Tax Examination Changes, and opens the window to request an Appeals conference.
•Generally 30 days from the date of the letter, and the IRS's own guidance uses the word "generally" because the periods vary by letter.
•Where the amount in dispute is $25,000 or less you can use a short Small Case Request on Form 12203. Above that, a formal written protest is required.
•The protest goes to the IRS office named in the letter, not to Appeals. Sending it to Appeals directly can prevent Appeals considering the case.
•If the window passes, the IRS issues a Notice of Deficiency — Letter 3219 after a mail audit, Letter 531 after an in-person one — with 90 days to petition the Tax Court.
•If you are also asked to sign a consent extending the assessment period, that request has a reason, a cost, and a middle option the statute requires the IRS to tell you about.

What a Letter 525 is

A Letter 525 is the letter that transmits the examiner's proposed changes and gives you 30 days to ask for Appeals. The Taxpayer Advocate Service:

"Letters 525, General 30-Day Letter, and 915, Examination Report Transmittal, are 30-day letters you receive when the audit of your tax return results in proposed adjustments." "Generally, Letter 525 is issued if your audit was conducted by mail and Letter 915 is issued if your audit was conducted in person." "Form 4549, Report of Income Tax Examination Changes, a report showing the proposed adjustments to your tax return, will be enclosed with the letter." — Taxpayer Advocate Service, "Letter 525 Audit Report/Letter Giving Taxpayer 30 Days to Respond," last updated 12 May 2026

"30-day letter" has an actual definition in the tax code, and it is more useful than the name suggests. Section 6603 of the Internal Revenue Code defines the term, for its own purposes, as:

"the first letter of proposed deficiency which allows the taxpayer an opportunity for administrative review in the Internal Revenue Service Independent Office of Appeals." — 26 U.S.C. 6603(d)(3)(B)

Notice what the definition turns on. Not the number of days — the fact that it is the first letter offering Appeals. That is the thing this letter is, and it is why the Internal Revenue Manual is careful about which letters qualify: it records that a Letter 5153 "is not a 30-day letter" and that a Letter 1912 "is not a 30-day letter", even though both transmit reports.

A note on sources. The IRS publishes no "Understanding your Letter 525" page — we checked, along with Letters 531, 566, 692, 915 and 3219, and none of them has one, while CP2000, CP2501, CP3219A, CP22A, Letter 2030, Letter 2531 and Letter 3219B all do. This page is built from the Taxpayer Advocate Service, the Internal Revenue Manual, Publication 3498-A and the Internal Revenue Code.

Your clock

Generally 30 days from the date of the letter, and the date on your letter is the one that counts. The IRS's own statement of the rule:

"You must send your formal written protest within the time limit specified in the letter that offers you the right to appeal the proposed changes. Generally, the time limit is 30 days from the date of the letter." — IRS, "Preparing a request for appeals," read 6 September 2026

And the Taxpayer Advocate Service, on this letter specifically: "Generally, you must request an Appeals conference within 30 days from the date of your letter to be given consideration."

Two things about that sentence are load-bearing. The trigger is the date of the letter, not the day it reached you — the same trigger as the collection hearing window, and people conflate the two. And "generally" is in both sources for a reason: the combination initial-contact letters run 30 or 45 days, a Letter 5153 runs 10, and a Letter 692 asks for 15.

More time is a phone call, made before the date. Publication 3498-A: "If you are unable to meet the deadline, please call the number on the letter to discuss your situation and/or request additional time." TAS says the same of this letter. It is a request, not an entitlement.

Sources: IRS, "Preparing a request for appeals"; TAS, Letter 525 page (updated 12 May 2026); IRS Publication 3498-A (Rev. 5-2021). All read 6 September 2026.

Can they take my wages or my bank account over this?

Not on the strength of this report. Section 6213(a) bars assessment of the proposed deficiency, and any levy or collection suit for it, until a Notice of Deficiency has been mailed and its 90 days — 150 if it is addressed to you outside the United States — have run, and until any Tax Court case is finished.

And there is one thing on this page that ends that protection, which is why it belongs here rather than in a footnote. Under 6213(d) a taxpayer may waive the restrictions in writing — and the agreement form enclosed with your examination report is that waiver. Signing it is frequently the right decision and it is your decision. It is also the moment the bar comes off and the account moves to collection.

The statute names its own further exceptions at sections 6851, 6852 and 6861, and a math or clerical error assessment sits outside the bar under 6213(b)(1). None of this touches a balance already assessed for another year.

The two ways into Appeals, and the threshold between them

Which route you take depends on the amount, and there are two published counts of it.

"You may submit a Small Case Request if the entire amount of additional tax and penalty proposed for each tax period is $25,000 or less from an examination (audit)." — IRS, "Preparing a request for appeals"

"Small Case Request ($25,000 or less) — If the amount you want to appeal is $25,000 or less in proposed change in tax, penalties, and interest for each tax period..." — IRS Publication 3498-A (Rev. 5-2021), which is the booklet the IRS encloses with mail-audit correspondence

Those are not the same count. The web page counts tax and penalty. The booklet counts tax, penalties and interest. Both are current IRS guidance. If your number is anywhere near the line, published guidance will not settle which side of it you are on. Ask before you assume.

	Small Case Request	Formal written protest
When	$25,000 or less per tax period	Above $25,000 per tax period
How	A written protest following Publication 5	A written protest following Publication 5
Who cannot use it	"Employee plans, exempt organizations, S corporations and partnerships are not eligible for Small Case Requests"	—

And the mistake that costs the most, in the IRS's own words:

"Don't send your protest directly to the IRS Independent Office of Appeals (Appeals); this will only delay the process and may prevent Appeals from considering your case."

The protest goes to the address in the letter. The examination office gets to try to resolve it first — "Before sending your case to Appeals, the IRS Examination or Collection office that made a tax assessment or initiated collection action will consider your protest and attempt to resolve the disputed tax issues" — which is worth knowing, because it means a protest is not an appointment with Appeals so much as a request that turns into one.

There is also a free step before either of them. Publication 3498-A: "Request an informal conference with the examiner's manager prior to the date given in the letter." It costs nothing. And the Taxpayer Advocate Service puts both requests before the same date — the manager conference "prior to the response date in the letter", the Appeals conference "prior to the date in the letter." Nothing published says asking for the manager moves the Appeals date, so the safe reading is: ask for the manager and protect the Appeals date.

Why they are asking you to sign an extension

This is the part nobody explains, and the IRS's own manual explains it.

The IRS generally has three years from when a return was filed to assess additional tax. Six years where the omission from gross income exceeds 25% of the gross income stated in the return — and, on a separate and independent basis, six years where a foreign asset reportable under section 6038D was omitted by more than $5,000, with no 25% test at all.

Appeals takes time, and the manual builds the timetable backwards from that clock. IRM 4.10.8.12.1:

"When a case is initially received in Appeals, there must be at least 365 days remaining on the statute ... a case should have a minimum of 395 days (or 210 if the case was returned) remaining on the statute when it is closed from the group." "Generally, taxpayers with 240 or more days remaining on the statute of limitations will receive the appropriate 30-day letter."

And here is what happens when there is not enough time left:

"When fewer than 240 days remain on the statute of limitations, the examiner should prepare and issue an agreed examination report with Letter 5153 ... to transmit the report and notify the taxpayer additional time is needed on the statute of limitations for Appeals to consider their case if it is unagreed, and allow 10 days to respond. Examiners sign Letter 5153, which is not a 30-day letter." "If the case is unagreed and the taxpayer signs a consent to extend the statute of limitations that will allow sufficient time for the case to be considered by Appeals, prepare and issue a 30-day letter." "If the case is unagreed and the taxpayer does not sign a consent, close the case to Technical Services for issuance of a notice of deficiency." — IRM 4.10.8.12.1 (04-10-2023)

Read plainly: on an unagreed case with little time left, signing the consent is what buys the Appeals conference, and declining it sends the file straight to a notice of deficiency.

That is a real cost. It is also not the whole picture, because the statute gives you a third option the IRS is required to tell you about:

"The Secretary shall notify the taxpayer of the taxpayer's right to refuse to extend the period of limitations, or to limit such extension to particular issues or to a particular period of time, on each occasion when the taxpayer is requested to provide such consent." — 26 U.S.C. 6501(c)(4)(B)

Refuse, or limit — to particular issues, or to a period of time. The middle option is the one most people have never heard of: an extension confined to the issues actually in dispute, or to a period long enough for Appeals to hear the case. Whether that is enough for the examiner is a question about your file and the time left on it, and it is a reasonable one to put to them.

What this page will not do is tell you which to choose. Signing extends the period in which the IRS can assess. Refusing, on an unagreed case, produces a notice of deficiency without the pre-assessment Appeals conference — which still leaves the Tax Court, at a filing fee and a different kind of effort. And refusing does not put Appeals out of reach for good. What it forfeits is the pre-assessment conference — the cheap, early one. Publication 3498-A describes what happens after a petition: "Your case will be considered for settlement by an Appeals Office before the Tax Court hears the case." So the choice is between reaching that office now, by letter, and reaching it later, after a notice of deficiency and a filing. Both are defensible and the right answer depends on how good the argument is and how much time is left, which are facts about your file rather than about the letter.

One thing is not a matter of judgment. Those numbers — 240, 365, 395, 210 — are the IRS's internal case-management timetable, not deadlines for you. The only date you have to keep is the one printed on your letter.

If a consent form is in front of you right now, that is the conversation to have before you sign or decline it, and it is the one thing on this page with a signature attached. (800) 236-3741 — answered at any hour.

The deposit that stops interest, and what it costs

If you expect to lose part of this and want to argue the rest, interest is the thing that quietly makes waiting expensive. The tax code has a mechanism for exactly this position.

Section 6603 lets you make a cash deposit — not a payment — against tax that has not yet been assessed. To the extent it is later used to pay tax, "the tax shall be treated as paid when the deposit is made," so interest stops on that amount. And:

"Except in a case where the Secretary determines that collection of tax is in jeopardy, the Secretary shall return to the taxpayer any amount of the deposit (to the extent not used for a payment of tax) which the taxpayer requests in writing." — 26 U.S.C. 6603(c)

The provision has a safe harbor written for a person holding this exact letter: where a taxpayer has been issued a 30-day letter, the amount treated as disputable "shall not be less than the amount of the proposed deficiency specified in such letter."

The limits, which matter as much as the mechanism. A deposit is not a payment and the difference is recoverability — but Publication 556 is explicit that if you take a deposit back and the IRS later assesses a deficiency, "interest will be figured as if the funds were never on deposit." Interest stops only on the amount you send; it keeps accruing on accrued interest. And the return duty has a jeopardy exception — Publication 556 names three further situations in which a deposit is not returned, so this is not money you can always get back on request. It is a decision about a specific account and a specific argument, not a general recommendation, and this page is not making one.

What happens if you do nothing

A notice of deficiency issues, and the venue changes from an office to a court. The Taxpayer Advocate Service on this letter:

"The IRS may disallow what you claimed on your return and issue a Notice of Deficiency, Letter 3219 (if your audit was conducted by mail) or Letter 531 (if you had an in-person audit). This legal notice gives you 90 days to petition the United States Tax Court (you have 150 days if the notice is addressed to a person outside the United States)."

The Internal Revenue Manual for correspondence examinations says the same from the inside: where a Letter 525 went out with a proposed report and no response came back, the instruction is to "issue 90 Day, Notice of Deficiency, Letter 3219."

What is lost is not the argument. It is the cheap version of the argument. Appeals is an office you write to. The Tax Court is a court you file in, by a deadline nobody can extend. What the 90 days actually is, and where the petition goes — Letter 3219 and Letter 531.

What to do in the next 30 days

1. Today: write down the date on the letter, and check whether the Form 4549 is enclosed. Those two facts decide everything else, and they take five minutes.

2. Work out whether you are agreeing, disagreeing, or disagreeing with part. Partial agreement is ordinary and it narrows what Appeals has to look at.

3. If you disagree, work out which Appeals route the amount puts you in — Form 12203 at $25,000 or less, a Publication 5 protest above it, with the caution above about the two counts.

4. Ask for the manager conference as well, and put the Appeals request in first. It is free, it sometimes resolves the whole thing, and it does not move the date.

5. If you are asked for a statute consent, ask what it is being used for, and ask about limiting it. The IRS is required to tell you that refusing and limiting are both available. Asking which issues and which period would be enough is an ordinary, reasonable question.

6. Send the protest to the address on the letter. Not to Appeals.

The hard part on this page is not procedural, it is judgmental: whether the report is wrong in a way that Appeals can do something about. Appeals weighs the hazards of litigation. That is a different question from whether you feel the examiner was unfair, and it is the question the whole 30 days is really about. Reading a Form 4549 against the account transcript is how it gets answered, and neither document is written to be read by the person receiving it.

The Audit Response & Records Checklist

What substantiation actually means item by item, what Appeals looks at that an examiner does not, and the order to assemble a protest in. It is the working order we use when a report arrives with a date on it. First name and email, because it carries dated material and the list is how a correction reaches you.

[ Get the checklist → ]

Signing the report starts a Kentucky clock too

A federal examination that changes your numbers starts a second clock in Frankfort, and it starts at a moment you will not be watching for.

Under KRS 141.211(2), a Kentucky taxpayer must file a federal adjustments report with the Department of Revenue and pay any additional Kentucky tax "no later than one hundred eighty (180) days after the final determination date."

"Final determination date" is a defined term with more than one meaning, and the one that catches people is this:

"For agreements required to be signed by the Internal Revenue Service and the taxpayer, the final determination date is the date upon which the last party signed the agreement." — KRS 141.211(1)(i)1.b

So an examination that ends in a signed agreement starts the Kentucky 180 days at the last signature — and "last party" ordinarily means the IRS countersigning, not you. Where the matter is contested or appealed instead, the date is "the first day on which no federal adjustments arising from that action remain to be finally determined."

Not filing does not close it — it widens it. Kentucky has one year from the filing of a timely report to assess. Where the report is late, never filed, or omits adjustments or understates the tax, it has six years, measured from the final determination date rather than from anything you do.

Source: KRS 141.211(1)(i), (2) and (10), read 6 September 2026. The 180-day rule has its own exception for partnership-level audits, where the partnership is on 90 days and its direct partners on 180.

Which balance to deal with first when both are live

Katherine M. Johnson, CPA, CTRS

Katherine M. Johnson is a licensed CPA with over 30 years of experience and a Certified Tax Resolution Specialist (CTRS). She personally handles every case — representing individuals and businesses before the IRS and state revenue departments nationwide.

Read full bio

What we see

Letter 525s reach our office in Georgetown with the report read closely and the date not read at all. People can tell you exactly what the IRS is proposing and have not registered that a window is running underneath it, so the first thing we do is separate the two — what the report asserts, and the date the Appeals request has to be in by — because only one of those can be recovered later. The second thing that comes across the desk is the consent extending the assessment period, with the same question attached, generally asked as though it were a trick. It is not a trick. It is a scheduling problem the IRS has, and the part almost nobody has been told is that the extension can be limited to the issues actually in dispute or to a period of time — which is the question we would want asked before anyone signs or refuses.

Katherine — You're welcome to replace this above paragraph.

Unlimited rights of representation before the IRS belong to CPAs, enrolled agents and attorneys. Katherine is a CPA, and holds the Certified Tax Resolution Specialist designation on top of that license — a tax-resolution credential open only to those three groups, with annual continuing education in this work. At this stage of an examination the license is what matters practically: a Power of Attorney means the correspondence, the calls and the Appeals request run through the practice, and the account can be read directly rather than reconstructed from the report.

Where this sits in the sequence

Notice	What it is
Letter 566	How a mail audit opens — the initial contact letter asking for documents, or the combination letter with the report already enclosed.
Letter 525▶ You are here	The General 30-Day Letter. It transmits the examination report (Form 4549) and opens the window to request an Appeals conference.
Letter 3219 / Letter 531	The Notice of Deficiency — 90 days to petition the Tax Court. The dispute leaves the IRS and becomes a court deadline.
Letter 692	If the report is revised instead — what a revised report actually means.

Before: Letter 566 — how a mail audit opens →Next, if this window closes: the Notice of Deficiency →What we do at this stage: IRS audit representation →All notices: the IRS notice index →

Frequently asked

What is a 30-day letter?

The first letter of proposed deficiency that gives you the chance to take the matter to the IRS Independent Office of Appeals. That is the tax code's own definition, at section 6603(d)(3)(B), and it is why a letter that transmits a report without offering Appeals is not one.

Do I have to go to Appeals, or can I just reply to the examiner?

You can reply. You can also ask for the examiner's manager informally. But the Appeals request has its own date and neither of the others extends it, so if you want Appeals, ask for it inside the window whatever else you are doing.

What is the $25,000 for?

It decides whether you can use a short Small Case Request on Form 12203 or need a formal written protest. Note that the IRS's web page and its own mail-audit booklet describe the count differently — one includes interest and the other does not — so a figure near the line is worth checking rather than assuming.

Should I sign the statute extension?

That is a decision, not a formality, and it depends on your file. What is certain is that the law requires the IRS to tell you that you can refuse, and that you can limit the extension to particular issues or to a particular period. Ask what period and which issues would be sufficient.

What if I miss the 30 days?

The IRS issues a notice of deficiency — a Letter 3219 after a mail audit, a Letter 531 after an in-person one — and you get 90 days to petition the Tax Court. The argument is not over; the venue and the cost change.

If you'd rather not work it out alone

We represent individuals and small businesses in IRS examinations from our office in Georgetown, Kentucky.

By the end of a first call about a Letter 525 you will know four things: which date is actually running and what it is a date for, whether the amount puts you in a Form 12203 request or a full protest, what the statute consent is being asked for and what limiting it would look like, and whether the disputed item is the kind of thing Appeals resolves or the kind it does not.

If the report is right, the arithmetic is right, and the only reason to appeal is that the outcome is unwelcome, Appeals is unlikely to change it and the money is better spent on how to pay. Sign the report and ask about a payment plan — the IRS's own application is online and it does not need us. Our page on payment arrangements is here.

Where the call earns its thirty minutes:

the report disallows something you can substantiate but did not;
the examination touched a year with a business, a rental or a K-1 in it;
a statute consent is in front of you and nobody has told you it can be limited;
the date on the letter is inside two weeks and you do not yet know which Appeals route the amount puts you in.

The first consultation is free. It is thirty minutes. There is no obligation and no conditions attached to it.

And the thing worth knowing before you spend it: every case in this office is reviewed and worked by Katherine personally. Not handed to a processing department. Not managed by someone relaying messages from a licensed person you never meet. That is the difference between this and the firm advertising on the radio, and it is the one that shows up in month three rather than on the first call.

Bring the letter and the Form 4549 — that is what the thirty minutes is spent reading.

(800) 236-3741 — answered 24 hours a day, seven days a week, which matters when a 30-day letter arrives on a Friday. After hours it is our AI receptionist, not voicemail: it answers the common questions, takes the date printed on your letter, and books the first available thirty minutes.

This article is general information, not tax advice for your situation. Every account is different, and the options described here are not available to everyone. Next Level Tax Resolution is not affiliated with the Internal Revenue Service or any government agency.

Call (800) 236-3741 Book a time

The NLTR Office ·

Reviewed by Katherine M. Johnson, CPA, CTRS