How long does the IRS have to start the audit process?

On Behalf of | Jun 5, 2020 | Tax Audits

It is no secret that the Internal Revenue Service is extremely short-staffed and has been for some time. It can take agents years to review and identify tax returns that may need to be audited. Thankfully, though, there is a statute of limitations for starting the audit process, and knowing what the deadline is can help Connecticut residents determine how long they need to hand on to their tax records.

The statute of limitations for which the IRS may audit the typical taxpayer in Connecticut is three years from the date of filing. So, if one filed on April 15, 2020, the IRS has until April 15, 2023, to start an audit on the return. There are a few states where the statute of limitations is different, but for most states, it is three years. This means one will want to keep tax records at least until the deadline has passed.

There is reason people may want to keep tax records longer than three years. The statute of limitations extends to six years if the income reported is off by 25% or more. There is no statute of limitations if tax fraud or evasion is suspected.

How long Connecticut residents choose to keep their tax returns is a personal choice. Having documentation, though, if one ends up having to go through the audit process is invaluable. Those who find themselves the subject of an audit can turn to legal counsel for assistance getting through it. If the statute of limitations is believed to have passed, one’s attorney can fight to have the audit dismissed.