Filing an appeal, in the majority of cases, results in some savings -- but rarely a total victory.

There are three solid reasons for appealing an IRS tax audit (and two relatively insignificant reasons not to).

Pros

• Appealing is simple and costs nothing, unless you use a tax pro (an accountant or tax attorney) -- which is not required.
• Appealing can delay your audit tax bill for months, buying you time to raise cash or consider other payment options.
• Appealing, in the majority of cases, results in some tax savings (although rarely a total victory).

Cons

• The appeals officer can raise issues the auditor missed -- which could cost you more money -- but this almost never happens. However, if you are afraid that a particular item will be discovered and you'll owe a lot more in taxes, you can skip the appeal altogether and go directly to tax court, where new issues can't be raised. You should consult a tax pro before skipping the appeal process, though.
• Interest on the tax bill continues to run while you are appealing, but this is usually a small item compared to the tax savings that are likely to result.