Tax controversy is experiencing a moment of elevated demand. The IRS announced in 2024 that it would significantly increase audit coverage of large corporations, partnerships, and high-net-worth individuals, backed by supplemental funding under the Inflation Reduction Act. For tax controversy firms—those specializing in IRS examinations, appeals, and Tax Court litigation—this enforcement expansion means a growing pipeline of clients who need representation. It also means more administrative complexity. In 2026, virtual assistants are helping these firms manage billing and IRS administration without overwhelming their senior practitioners.
IRS Enforcement Expansion and Its Impact on Controversy Practices
The IRS reported in its 2025 annual update that audit rates for large corporations (those with over $10 million in assets) increased by more than 50 percent compared to 2022 levels, and that examination activity targeting pass-through entities and high-net-worth individuals had similarly accelerated. The agency also expanded its Large Business and International (LB&I) division's capacity to handle transfer pricing and international enforcement cases.
For tax controversy firms, this enforcement expansion is driving significant new business. But it is also creating administrative demands that are difficult to absorb. A single corporate examination can involve hundreds of IDR (Information Document Request) responses, multiple rounds of draft proposed adjustments, coordination with outside counsel, and months of Appeals proceedings—all of which require careful document management and deadline tracking.
The National Association of Enrolled Agents notes that IRS response deadlines are firm and that missed deadlines in an examination context can have severe consequences for the client's legal position. Administrative rigor is not optional in tax controversy work.
Billing for Audit Defense and Appeals Engagements
Tax controversy engagements are typically billed on an hourly basis against a retainer, with larger matters sometimes structured with milestone payments tied to examination stages—field examination, Appeals, Tax Court. Managing billing across a portfolio of active controversy engagements requires tracking time by matter and billing period, reconciling against retainer balances, issuing replenishment requests when retainers run low, and generating invoices that clearly document the work performed.
Virtual assistants manage the full billing cycle for tax controversy practices. They maintain time entry records by matter, generate monthly or milestone-based invoices, track payment receipt and retainer balances, and issue timely replenishment requests to clients before retainers are exhausted. When an engagement concludes, VAs prepare final billing statements and coordinate with clients on settlement of any outstanding balance.
Deloitte's 2025 Professional Services Operations Benchmark found that law and tax controversy firms with structured billing administration collected fees with 20 percent less write-off than those without dedicated billing support—a meaningful difference in a practice where matters can run for years.
IRS Examination Coordination and IDR Management
The operational core of tax controversy work is deadline management. IDR response deadlines, Appeals conference scheduling, Tax Court filing dates, and statute of limitations dates must all be tracked with precision. Virtual assistants maintain the firm's controversy calendar, log every incoming IRS communication, identify response deadlines, notify the responsible attorney or CPA, and track each response through to submission.
For IDR responses—which require collecting documents from the client, reviewing for privilege and relevance, and organizing into the format requested by the IRS—VAs manage the client-side document collection process. They send structured request lists to client tax departments, track receipt, maintain the document inventory, and prepare the submission package for attorney review before it goes to the IRS.
McKinsey's research on administrative delegation in professional services found that document collection, deadline tracking, and stakeholder coordination account for 35 to 45 percent of total engagement labor in litigation and regulatory response matters—making these functions prime candidates for VA support.
Client Communication Through the Examination Lifecycle
Corporate and high-net-worth clients under IRS examination are often anxious and unfamiliar with the examination process. Regular, clear communication from the firm is essential to maintaining the relationship and keeping the client appropriately informed without creating alarm.
Virtual assistants send regular status updates at defined milestones, prepare meeting agendas for client calls, distribute deliverables such as draft IDR responses and position papers for client review, and confirm receipt. For clients with in-house tax departments, VAs coordinate information requests with the client's legal and finance teams, managing the flow of documents between the firm and the client without consuming the practitioner's time on routine coordination.
Tax controversy firms looking to improve billing and examination administration can explore virtual assistant support at Stealth Agents.
Expanding Capacity for a Growing Enforcement Environment
The IRS enforcement expansion is likely to persist for several years as the agency deploys its additional resources. Tax controversy firms that can handle a higher volume of active examinations without proportional increases in administrative overhead will be positioned to grow revenue while protecting margin. Virtual assistants provide exactly that leverage—enabling experienced controversy practitioners to focus on the strategic and analytical work that drives outcomes for clients.
Sources
- Internal Revenue Service, IRS Annual Update on Audit Rates and Enforcement Priorities, 2025
- National Association of Enrolled Agents, 2024 Tax Controversy Practice Guide
- Deloitte, 2025 Professional Services Operations Benchmark Report