• Income Taxes
  • Tax Audits
  • Tax Refunds

How far back can the IRS audit?

Top Answer
User Avatar
Wiki User
Answered 2012-02-14 14:39:54

In British Columbia, Canada our Revenue Canada is quite lenient, but they want their money. They make every effort to let the person pay back taxes in installments, but, should that person goof off and not make any attempt they will find their butts in court.

They can go back 7 years (Statute of Limitations). Some 8 plus years ago I watched a program on the IRS. They were so cold-blooded many people turned to suicide because they lost everything and many people ended up out on the street. The poor really got the worst of it. Since then (and thanks to the Senate) the IRS has since had their hands slapped and an investigation was done and some employees are higher ups fired, but don't be fooled ... if you owe back taxes you WILL have to pay them, but you shouldn't have to lose everything over it. If you are running a business or just a private citizen and want to really be protected get a good accountant (CGA) to do your taxes and save yourself the headaches. Taxation is constantly changing and it's complex for most individuals and not worth stomach ulcers.

Like anything with taxes the question is more complex than one may initially think. There is a difference between how far back a tax authority, including the IRS, (there are many others), can audit compared to how far back they can assess for a deficiency.

Moreover, how far back they can bust your chops, (to redefine the Q probably to what you mean), depends on several other factors: The type of tax and when the returns for it were filed. NOTE: IN virtually all circumstances the statute of limitations (SOL, whatever it may be for that tax) only starts running once the properly completed return is filed. Hence, if you don't file, you are perpetually open to audit and assessment (and criminal action).

Even once you have filed, several things effect the running of the SOL: Certain actions "toll" the time counting...notices sent giving a period of time to respond etc., can for example. So the period can grow substantially. It better have been a properly filed return to start the period. Counting frequently starts at the next month or accounting period and ends at the end of the last one. If the tax suspected of being underpaid is more than 25% of what was due, (not uncommon in fraud/intentional cases), there basically is no SOL restrictions. Many items in returns are based on prior years activities...those activities then remain open to audit.

Virtually all tax jurisdictions have the legal right to impose a "jeopardy assessment". That is, if they have not completed an audit by the SOL time, and want to, they can issue an assessment of just about any amount they want. So if your under audit, and the SOL will expire (frequent;y happens in Corp situations where audits can take years themselves, or when someone under audit thinks they can outsmart the Gov't and delay things until the SOL runs), and the taxpayer fails/refuses to sign an agreement to extend the SOL they automatically issue an assessment. For a number of complex reasons, arguing an assessment that has been issued is much worse than arguing about what it should be before hand.

For personal income taxes, the Assessment Statute of Limitations is 3 years from the date the tax was originally assessed (usually when the taxes were filed), except in cases of fraud. If they can prove fraud, there is no limitation.

In other words, they have 3 years from the date the taxes were originally assessed to make an additional assessment against you, via an audit or automatic adjustment.

The just above seems circular...the SOL on assessment is 3 years from assessment?

See the italicized portion and answer above it...which probably addresses your main Q's...and I cannot stress enough, having learned from previous inquiries.....virtually all counting starts with filing...if you do not file the period is always open for audit and assessment.

Normally within 3 years unless there are special situations or fraud involved.

An example of "special situations" is if you under report your income by over 25%.

They go back either 3 years or 6 years, plus the current year. So it ends up being either 4 or 7 years.

You should think of it in terms of the number of tax returns they go back, rather than in time. After all, in an audit, they want that many years worth of data, which comes in 12 month chunks (April 16 of last year to April 15 of the current year). They want 3 chunks of data, plus the current year's information, for your standard audit. The 6+1 if they find a problem.

User Avatar

Your Answer


Still have questions?

Related Questions

What happens if you cannot produce the receipts requested for an IRS audit?

what will happen if i do not show up for a irs audit

If you fail to claim a schedule k-1 how far back can the IRS audit you?

see its alot to it just put yo mind to it ya heard piece out

Can the IRS audit an old return?

The IRS can audit a return up to three years after a return has been filed.

Where can I get help for an IRS tax audit?

For an IRS tax audit, you should speak with a qualified accountant and a qualified attorney. These professionals can best guide you through the process of an audit.

Outline the Consequences of a qualified audit report?

An audit report may have severe consequences. An IRS audit for example may cause a person to have to pay back money they received as an error in reporting income.

How far back can revenue Canada audit?

six years

Can the IRS garnish an income tax refund if money is owed from an audit?

Yes, the IRS can, and will, garnish an income tax refund if money is owed from an audit.

Where can you find a template letter to the IRS for tax audit reconsideration?

audit reconsideration process letter

Who in my area can offer IRS audit help?

There are local CPAs that offer IRS audit help. The best of which is taxmasters. There at taxmasters, they solve your tax problems. They can be reached at, I believe.

How does the IRS notify someone of an audit?

The IRS has a few different ways to inform someone that they are going to conduct an audit. They'll send out the information through the mail, but they might also call and email. Either way, a person about to be audited will be notified prior to the actual audit.

Do I need to hire a lawyer if I get audited by the IRS?

There is no way to tell how much you will owe after an audit. Hiring an experienced tax audit lawyer can work through problems that may arise after the audit.

Where can I get advice on what to do during an IRS audit?

You can go to and they help you to understand the process and what you can do during an audit. Not ever audit results in additional money needing to be paid so you should not stress.

What is the process for an IRS audit?

The process of an IRS audit pretty simple. First they check to see if all taxes have been paid, they give you a warning if all taxes are not paid, then they take you to jail if you fail to pay your taxes.

What happens if I didn't claim income and the IRS finds out?

if the IRS finds out that a person does claim income, the IRS can audit the person. If audited, the person will have to go in person to their local IRS agency and explain the situation.

What happens when a person receives a tax audit notice from the IRS?

One receives an IRS tax audit notice when they believe one has filled out their tax audit incorrectly. One must gather all tax related documents, determine why they are being audited and if needed contact a tax lawyer.

Sample of Tax Audit Report and how to write?

A tax audit report summarizes the results of an IRS tax audit. In order to writer an audit, you must thoroughly analyze an individual's tax records and write our their findings and suggested actions.

Distinguish between Internal External audit?

An internal audit is when someone within your company checks over your books. An external audit is when someone outside of your company checks your books; like the IRS.

Examples of item treated as a prior period adjustment?

An adjustment as the result of an IRS audit.

Will the IRS hold your 08 refund while you are in the audit process from the 07 taxes?

Probably....and also likely = depending on what the audit is seeing - that they will extend the audit to 2008 - at least for those things they dispute for '07.

What are the penalties in an IRS audit?

This depends upon what the audit uncovers, and other factors like the taxpayer's criminal history. But the ultimate consequences of an audit range from prison, to repaying taxes that are due, to nothing at all.

What does it mean when the IRS says there audit your refund?

An IRS audit is a review/examination of an organization's or individual's accounts and financial information to ensure information is being reported correctly, according to the tax laws, to verify the amount of tax reported is accurate.

How often can the IRS audit an individual?

Pretty much as much as it wants or feels necessary.However, if the IRS audits you two years in a row and finds no change to your tax return they cannot audit you again for that specific item that was unchanged for several years.

How far back can the state of arizonado a personal audit?

If you filed an original return, 3 years from the date it was filed and assessed.

When is the audit usually done?

When an accident is reported to OSHA or when return doesn't jibe with other years or deductions are excessive (IRS) if another type of audit-please restate.

How far back can the US go back for a audit?

I believe the current policy is SIX YEARS without managerial approval. However, if you failed to file a tax return from anytime in the past and the IRS determines that you had sufficient income to have a filing requirement then Congress requires the IRS to file what is known as a Substitute For Return for you. The SFR will list ALL the income that the IRS is aware of. If, in previous years, you filed as Married Filing Jointly then the IRS will allow the Married Filing Separately standard deduction. If not, then the IRS will allow the Single standard deduction. Either way you will be allowed YOUR OWN exemption only - even if the previous year return had dependents listed. The IRS can get somewhat "tedious" with back-due taxes. You should acquire the services of a Tax Professional to "represent you" before the IRS instead of you having to go to see them.