The Internal Revenue Service (IRS) has the authority to audit tax returns for up to three years after the filing date or two years after the tax was paid, whichever is later. However, there are certain exceptions to this rule, and the IRS may audit returns further back in some cases.
Exceptions to the Three-Year Rule
The IRS may audit returns for more than three years if:
- Substantial error: The IRS discovers a substantial error on the return, such as an omission of income or an incorrect deduction.
- Fraud: The IRS suspects that the taxpayer committed fraud on the return.
- Extended statute of limitations: The taxpayer agrees to extend the statute of limitations for the audit.
How Far Back Does the IRS Usually Audit?
Even though the IRS has the authority to audit returns for up to six years, they typically focus on returns filed within the last two years. This is because the IRS has limited resources and wants to focus on the most recent returns, where there is a higher likelihood of finding errors.
How to Protect Yourself from an Audit
There are several things you can do to reduce your chances of being audited by the IRS:
- File your taxes accurately and on time.
- Keep good records of your income and expenses.
- Be prepared to provide documentation to support your deductions and credits.
- If you make a mistake on your return, file an amended return as soon as possible.
What to Do If You’re Audited
If you’re audited by the IRS, don’t panic. The IRS is simply trying to verify the accuracy of your return. Here are some tips for dealing with an audit:
- Cooperate with the IRS. Provide the IRS with all the documentation they request.
- Be honest and upfront with the IRS. If you made a mistake, admit it.
- If you disagree with the IRS’s findings, you can appeal the decision.
How Long Should I Keep Tax Records?
The IRS generally recommends that you keep tax records for at least three years. However, there are some records that you should keep for longer, such as:
- Property records: Keep records of property you own until you sell or dispose of it.
- Investment records: Keep records of investments until you sell or dispose of them.
- Employment records: Keep records of your employment until you retire.
By following these tips, you can reduce your chances of being audited by the IRS and protect yourself in the event of an audit.
Tax Documents: How Many Years Do I Keep Tax Records? How Many Years Can IRS Go Back? IRS Audit Ready
FAQ
Can the IRS go back more than 10 years?
Can the IRS come after you after 10 years?
How far back can IRS get back taxes?
How long are IRS records kept?
How long should I keep my tax records?
Generally, the IRS recommends hanging on to your tax documents for three years and employment tax records for four years. But there are various circumstances where it recommends you keep them for a longer period of time. How long does an IRS audit take? There’s no standard length of time an audit takes, the IRS says.
How long should I keep my tax returns?
Once you file your taxes, you should plan to keep your tax returns for a minimum of three years from the date you filed your original return. You can also keep them for two years if you are calculating from the date you paid the tax, whichever comes later.
How long should I keep a copy of my tax return?
Individuals should generally keep copies of their tax returns and any documents for at least three years after they file. If a taxpayer doesn’t have this information here’s how they can get it: Individuals should first check with their software provider or tax preparer for a copy of their tax return.
How long does the IRS have to assess a tax?
Under IRC § 6501 (a), the IRS generally has three years from the later of the due date of the return or the actual filing date of the return to assess a tax due on the taxpayer. Any time within this three-year period, the IRS can assess the tax for a given tax year on the taxpayer. Statute begins to run from the due date.