IRS Audit Time Limit:
The IRS typically has three years from the date you filed your tax return to initiate an audit. This period is known as the statute of limitations. However, several factors can extend this time limit:
Six-Year Rule: If you underreported your income by more than 25%, the IRS can audit your return within six years of the filing date.
No Time Limit for Fraud: If the IRS suspects fraud or if you didn’t file a return, there is no statute of limitations, and they can audit your return at any time.
Amended Returns: If you filed an amended return, the IRS has three years from the date of the amended return or two years from the date you paid the tax, whichever is later, to audit that return.
Foreign Income and Assets: If you failed to report foreign income or certain foreign assets, the IRS has a longer audit window of up to six years.
IRS Audit Assistance:
If you are audited by the IRS, you have the following options for assistance:
Self-Representation: You can represent yourself during an IRS audit, but it’s advisable to be well-prepared and knowledgeable about tax laws and regulations.
Enrolled Agent (EA): Enrolled agents are tax professionals licensed to practice before the IRS. They can provide representation and assistance during an audit.
Certified Public Accountant (CPA): CPAs are qualified to handle tax matters, including IRS audits. They can assist you in preparing for and representing you during the audit.
Tax Attorney: Tax attorneys specialize in tax law and can offer legal representation during an audit, especially in complex cases or if legal issues arise.
CDTFA Audit Time Limit:
The CDTFA, responsible for overseeing various California state taxes and fees, generally has three years from the due date of the return or the date it was filed, whichever is later, to conduct an audit. Similar to the IRS, certain factors and exceptions can extend this time limit.
If you are audited by the CDTFA, you can seek assistance in various ways:
Self-Representation: You can represent yourself during a CDTFA audit, but it’s advisable to be well-prepared and familiar with California tax laws.
Tax Professionals: You can hire a tax professional, such as a CPA or tax attorney, to provide guidance, representation, and assistance during the audit process.
CDTFA Assistance: You may also contact the CDTFA directly for information and guidance regarding the audit process.
In both IRS and CDTFA audits, it’s crucial to maintain accurate records, cooperate fully with the auditors, and seek professional assistance when necessary to ensure compliance with tax regulations and protect your interests during the audit process how long can irs audit your tax return.
