The statute of limitations for IRS tax audits is three years from the due date or the date the return was filed, whichever is later, under section 6501(a) of the Internal Revenue Code. However, there are some exceptions that may extend the statute of limitations. For example, if a taxpayer omits more than 25% of their income, the statute of limitations can be extended to six years. If a taxpayer does not file a return, files a fraudulent return, or willfully attempts to evade tax, there is no statute of limitations.
It is important to note that if the IRS identifies additional taxes owed during an audit and the taxpayer agrees to pay the additional amount, the taxpayer has effectively extended the statute of limitations for assessment of those taxes. Additionally, if the IRS files a lawsuit against a taxpayer to collect unpaid taxes, there is no statute of limitations.
If a taxpayer is concerned that an audit may be imminent or if the taxpayer has received notice of an audit, it is important to consult with a licensed attorney who can provide legal advice specific to the taxpayer’s situation.
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