how far can the irs go back on an audit

The IRS generally has a three-year statute of limitations to conduct an audit, but this timeframe can be extended in certain situations. Here are some general guidelines:

1. Three-year statute of limitations: The IRS typically has three years from the date you filed your tax return to initiate an audit. If you filed your return on time, the three-year period starts on the filing deadline (usually April 15th). If you filed an extension, the three-year period starts on the date you filed the return.
2. Six-year statute of limitations: If the IRS suspects that you underreported your income by 25% or more, they can extend the audit period to six years.
3. No statute of limitations: If the IRS suspects that you committed tax evasion or filed a false return, there is no statute of limitations. They can audit you at any time.
4. Extended statute of limitations: If you agree to extend the statute of limitations, the IRS can audit you beyond the original three-year period. This is usually done in writing, and you should carefully consider the implications before agreeing to an extension.
5. State tax audits: State tax authorities may have different statutes of limitations, which can range from three to six years or more, depending on the state.

It’s essential to note that the IRS can also use the following methods to extend the audit period:

• Tolling agreements: The IRS can ask you to sign a tolling agreement, which suspends the statute of limitations for a specific period.
• Summonses: The IRS can issue a summons to obtain records or testimony, which can extend the audit period.
• Criminal investigations: If the IRS is conducting a criminal investigation, the statute of limitations can be extended or even waived.

To minimize the risk of an audit, it’s crucial to:

• File accurate and complete tax returns
• Keep detailed records and documentation
• Respond promptly to IRS inquiries
• Seek professional help if you’re audited or have concerns about your tax situation

Remember, the IRS can audit you even if you’ve done everything correctly. If you’re audited, it’s essential to cooperate and seek professional guidance to ensure the best possible outcome.