While we never anticipate it will happen to us, there is always that lingering possibility that you might get audited by the IRS. In the past, the statute of limitations was three years. However, there are caveats to this. Recently, the statute of limitation has doubled to six years, in some cases.
The IRS can go back and audit you under the following conditions:
This is the normal statute of limitations on tax audits. It’s important to note, however, that if you file an extension, the statute does not begin at the deadline in April. It starts on the date that you file.
The IRS is authorized to go back up to SIX years if you exclude more than twenty five percent of your stated gross income. They can also go back this far if you excluded more than $5,000 of FOREIGN income such as interest made on an overseas account.
Basically the IRS can go back and audit you at any time if you just fail to file altogether or you exclude certain tax forms. In addition, if you fail to report foreign assets or there is potential fraud, there are no time limits.
If you need help learning about and preparing your taxes this year or would like more information on the statute of limitations, please visit our live chat at our website (www.semaphoretax.com) to get in contact with one of our experienced tax professionals, or call us at 866-736-2444. We’re excited to hear from you!