The Internal Revenue Service (IRS) is responsible for enforcing the nation’s tax laws. As part of its enforcement efforts, the IRS conducts audits to ensure that taxpayers are complying with these laws. Audits can be conducted on individuals, businesses, and organizations.
One of the most common questions taxpayers have about audits is how far back the IRS can go when conducting an audit. The answer to this question depends on several factors, including the type of audit being conducted and whether the IRS has identified any substantial errors on the taxpayer’s return.
General Audit Period
In general, the IRS can include returns filed within the last three years in an audit. This means that the IRS can request documentation and information for tax returns filed during the current year and the two preceding years.
For example, if the IRS is conducting an audit for the 2023 tax year, they can request documentation for the 2022, 2021, and 2020 tax years.
Extended Audit Period
In some cases, the IRS may extend the audit period beyond three years. This can happen if the IRS identifies a substantial error on the taxpayer’s return. A substantial error is an error that results in a significant understatement of tax liability.
If the IRS identifies a substantial error, it can extend the audit period to six years. This means that the IRS can request documentation and information for tax returns filed during the current year and the five preceding years.
For example, if the IRS identifies a substantial error on the taxpayer’s 2023 tax return, they can extend the audit period to include the 2022, 2021, 2020, 2019, and 2018 tax years.
No Statute of Limitations for Certain Issues
There is no statute of limitations for certain tax issues. This means that the IRS can audit a taxpayer’s return at any time if the taxpayer has failed to report income, filed a fraudulent return, or failed to file a return.
Some examples of tax issues that have no statute of limitations include:
- Failing to report income from illegal activities
- Filing a fraudulent tax return
- Failing to file a tax return
How to Avoid an Audit
While the IRS can audit any taxpayer’s return, there are steps that taxpayers can take to reduce their risk of being audited. These steps include:
- Filing accurate and complete tax returns
- Keeping good records of all income and expenses
- Responding promptly to IRS notices and requests for information
- Seeking professional tax advice if you have complex tax issues
What to Do If You Are Audited
If you are audited by the IRS, it is important to remain calm and cooperative. You should gather all of the documentation and information that the IRS has requested and provide it to them in a timely manner.
You should also consider seeking professional tax advice if you are not comfortable dealing with the IRS on your own. A tax advisor can help you understand your rights and responsibilities during an audit and can represent you in front of the IRS.
How far back can IRS audit?
FAQ
Can the IRS go back more than 10 years?
What is the IRS 6 year rule?
What triggers an audit by the IRS?
Can the IRS come after you after 10 years?
How far back can the IRS audit you?
An audit the IRS conducts on you can include returns filed within the last three years, according to the IRS. “If we identify a substantial error, we may add additional years. We usually don’t go back more than the last six years,” a post on the agency’s site states.
How many years does the IRS audit a tax return?
An audit the IRS conducts on you can include returns filed within the last three years, according to the IRS. “If we identify a substantial error, we may add additional years. We usually don’t go back more than the last six years,” a post on the agency’s site states. “The IRS tries to audit tax returns as soon as possible after they are filed.
Can the IRS audit more than 6 years?
However, if during the audit process the IRS identifies a substantial error, it may audit additional prior years. It is rare for the IRS to go back more than six years in an audit. The IRS statute of limitations for an audit is six years, though there are tax issues for which there is no statute of limitations.
How long can the IRS audit if you omit tax forms?
Another scary rule is that the IRS can audit forever if you omit certain tax forms. Plus, once a tax assessment is made, the IRS collection statute is typically 10 years. And, in some cases that ten years can essentially be renewed. That’s one reason the IRS can sometimes go back an astounding 30 years! In Beeler v.