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How far back can an IRS audit go?

On Behalf of | Feb 29, 2024 | Tax Controversies |

The idea of a tax audit by the IRS can be daunting. It also brings up many questions.

A common concern by many people is how far back the IRS can go when looking at past tax returns. Understanding the statute of limitations for tax audits can help you navigate your tax obligations and avoid potential issues with the IRS.

Three-year general limit

Generally, the IRS can audit your tax returns for up to three years after the filing date. However, if the IRS suspects you made a substantial error, they may extend this period to six years.

This is the statute of limitations for assessment. It is important to note that the statute of limitations applies to the date you filed your return and not the date you made payments on your account.

Further extensions and procedures

If the IRS believes you have committed fraud or failed to file a tax return, there is no statute of limitations for assessment. In these cases, the IRS can audit you at any time.

During an audit, the IRS will review your financial records and may ask for additional information to verify the accuracy of your tax return. If the IRS finds discrepancies, they may adjust your tax return and assess additional taxes, interest and penalties.

The bottom line is that the IRS has a pretty wide range of how far they can go back for audits. The idea is to ensure taxpayers are complying with tax laws and reporting their income accurately.