IRS Audit Process Timeline & How Long Procedures Take

An Audit letter from the IRS can be dreadful. One of the most fearful questions that often arrives in the mind of taxpayers is that “how long can IRS audit your taxes?”. The question can be tough to answer in many cases, especially because there are a variety of tax audits. Thus, it largely depends upon the situation of the taxpayer. The IRS audit process timeline can vary depending on the tax return’s complexity and the audit’s scope. The IRS Audit process timeline often takes time, but it is important to note that it also equally depends upon the situation you are in.

The government generally takes IRS Audits very seriously. Why? This is because it helps them find individuals or businesses who often disregard the value of tax. It is true that IRS Audit Timeline can take time at different situations, but having a headstart and knowing how and where to respond can minimise the time involved. However, should you receive a notice to audit from the IRS, responding in any manner which is any bit less than professional can make the process lengthier for everyone involved. The process often is intimidating, but with the proper step, it can be handled well. So, why not contact the best IRS Representation services?

IRS Audit Process Timeline

The IRS Audit Process Timeline is a bunch of steps involved in an audit that is conducted by the Internal Revenue Service (IRS) to review, verify and understand the taxpayer’s tax return. It is relatively true that the timeline can broadly vary on the basis of the complexity of the tax return and the scope of the audit in hand. The timeline for refunds from the IRS can be lengthy, but that is not the case for all audits.

The IRS Audit Process Timeline is the length of time the IRS takes to completely conduct an audit of the tax return filed by an individual. Since the time varies on the basis of the complexity, there are a variety of steps, including notification, preparation, fieldwork, and also, resolution.

The primary purpose of the audit is to ensure that taxpayers are reporting their income in an accurate and precise manner, thus paying the amount of taxes appropriately. During the time of the audit, the IRS starts by reviewing all documentation of the taxpayer, conducting interviews and making any adjustments to the tax return, if deemed necessary.

While it’s true that the timeline for tax returns can be quite long, it also equally depends upon the responsiveness of the taxpayer liable to answer their dues.

How Long Does an IRS Audit Take to Complete?

Exactly how long can IRS audit your taxes for? The IRS audit period typically takes no more than five to six months. With proper preparation, it can be resolved even faster. However, with time, the question arises “How long can taxes be audited?”

There are usually a few common factors that hold up an audit. Those include:

  • IRS discovers a pile of changes (adjustments) in your return
  • Owning a small business
  • You disagree with the adjustments given
  • Penalties

The IRS audit timeline generally takes no more than 26 months following the due date allotted to the tax return or the date filed, as per the Internal Revenue Service Manual. However, the IRS audit which takes more than a couple of months can be a red flag at times.

So, how long can the IRS audit? It depends. And how long do IRS audits take? Typically not more than 26 months.

At all times, do not expect the IRS audits immediately after you have filed the taxes.

To be specific, they have a three-year window to audit the tax returns. Sometimes, the time can be stretched to a period as long as six years or even longer considering a couple of underlying circumstances. The question “how long can taxes be audited?”, has puzzled many. But don’t worry, let the best tax consulting services take care.

How does an IRS Audit Work? Basic IRS Auditing Procedures

The word “audit” can often be unnerving. For the same, many ask “how do tax audits work?”. However, quite a bit of understanding about what it is can make things a little less scary. While some audits are no big deal, a couple others can be unsettling.

An IRS audit is simply a review of a taxpayer’s financial information in order to debate that they have filed complete tax returns. The audit process begins once the IRS sends a notice to the taxpayer, usually by mail, signifying that they are being audited.

There are a couple of IRS Auditing procedures as well. But, the question is, how do audits work? To understand the same, go through the ones usually conducted. Some basic IRS Audit Procedure include,

Correspondence Audits

Correspondence Audits are usually tackled via written correspondence, which is the mail.

The Simple Letter

The primary type of correspondence is a simple letter sent by the IRS to state that there are dues from your end to the government. A simple letter can result from a major error on the tax return or the omission of income on your tax return.

The Audit Letter

The audit letter is usually sent by the IRS when they ask for certain documents to support a deduction or other position on the return. Simply mailing the requested evidence can help resolve this correspondence in one go.

Office Audit

The IRS might as well consider wanting to interview you in person about certain items on your return. It is a complete audit and a step up in the form of seriousness. This usually consists of receiving a letter asking you to visit an IRS office on a specific date. However, this meeting also allows you to bring any tax professional from one of the many tax consulting services. However necessary, you are still allowed to appeal it by the end and challenge it in court.

Field Audit

This type of audit is usually where an IRS agent visits your home or your business place. This audit is typically more intrusive since it has access to your own place and can reach all your personal items.

Line-by-Line Audits

In a Line-by-Line Audit, taxpayers are often chosen at random to examine their returns, literally line by line. These happen only once in a while under the National Research Program (NRP).

Get in touch with our tax advisory services and get a detailed outlook on how do IRS audits work.

What Does the IRS Look For In An Audit?

In the IRS audit procedures, they usually look for a variety of things. The IRS audit process typically includes but is not limited to examining and looking through to find out wrong information. There are quite a few things that an IRS looks for in an audit. Some include:

Math Errors

The IRS scrutinises and examines whether your audit has any maths errors. It is best to not make any mistakes while filing any return to the IRS. The best practice includes not writing a 3 instead of a 9. Just make sure you have gone through the document, line by line, before submission.

Failure of Reporting Part of the Income

People often forget to report minor parts of their income that comes from different areas. Since you are receiving an income, there is a high chance that it is reported to the IRS. Make sure to report every bit of your income, even if it is freelance or part-time, to avoid being audited harshly.

Claiming Charitable Donations

You are eligible for deductions in case you have made significant contributions to charity. However, it’s best advised to not report false donations. If you cannot prove a donation, the best is to not claim it.

Losses Reported Via the Schedule C

This is for those who are self-employed. Even if you’re self-employed, avoid hiding any bit of income because it is only time till the IRS finds out.

Need Help Dealing with the Tax Audit Process?

Have you received a notice of audit from the IRS? Don’t panic. Dealing with the IRS alone can be an overwhelming experience for many.

With years of experience, Proffitt & Associates can help you walk through the entire audit process. Don’t navigate the tax audit process alone. Let us take care of all your financial interests and get you a fruitful outcome! Contact and schedule a consultation today!

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