Contents
Q: How Far Back Can the IRS Audit a Return?
A: As a general rule, the IRS can audit a return and assess additional tax up to 3 years after the return due date of the return filing date, whichever is later. There are exceptions to this general rule that provides the IRS more time to audit.
Q: What if I Don’t Respond to An IRS Audit?
A: If you don’t respond to the audit, the IRS will eventually create a debt or a new debt amount with penalty and interest, and then move the debt to the collection enforcement side.
Q: Do I Have to Pay the New Audit-Related Debt as Soon as I Get the Bill?
A: No. The new debt related to the audit must go through the IRS collection notice process in order to be considered “collectible” debt.
Q: What if I Just Missed the Entire Audit Process?
A: Rules provide for you to ask the IRS to “reconsider” the results of the audit you didn’t participate in.
Q: Can the IRS Contact Third Parties when Auditing Me?
A: Yes. The IRS can contact banks, business partners, and others. The IRS should provide you notice beforehand so that you can just provide the info or challenge the proposed contact.
Q: How Likely Am I to “Win” My Audit?
A: Provable facts and law matter. The taxpayer needs to be able to prove the income/expenses on the return are real and that they are nontaxable/deductible under the law.
Q: Can IRS Appeals Request a Statute of Limitation Extension?
A: Yes. The IRS only has a specific period to finalize an audit. If you appeal the decision, appeals may ask you to extend that date.
Q: How Likely Is It that I’ll Be Audited?
A: Overall audit odds have been low in recent years. But there are certain entities and items on tax returns that increase the odds of audit.
Q: What Are Considered Some Audit “Red Flags”?
A: There are certain types of returns and items in returns that are considered to be more likely to cause an audit.
Q: Can Someone “Turn Me In” for IRS Audit?
A: Yes. The IRS accepts “whistle-blower” information. The whistle-blower will submit a form to the IRS called the information referral form. The IRS encourages it.
Q: If I’ve Been Assigned a Field Auditor, What Should I Be Aware Of?
A: In-person audits are typically more complex and serious. There are some items you should be aware of.
Q: Can I Take Care of An IRS Mail Audit by Faxing Information?
A: Yes. In fact, it’s probably a preferred method if deadlines are near and you should follow up to ensure the fax was received.
Q: Can I File an IRS Tax Court Petition on My Own?
A: Many taxpayers file a petition with the U.S. tax court post audit on their own. The tax court web-page provides some detailed information about the process.
Q: How Do I Appeal a Bad Audit Result?
A: An audit result can be appealed internally and to the U.S. tax court.