Tax returns can be subject to review {audit, tax}. Audits question statements on tax returns.
process
An Internal Revenue Service (IRS) letter asks for records supporting tax-return statements. You must send requested records and a statement defending tax return or request an appointment with an IRS agent to deliver them.
If IRS rejects answers, you can appeal for review with IRS agent at IRS District Director office. However, burden of proof is on you. If review goes against you, you can appeal to Audit Division, then District Director, then Appellate Division of Office of Regional Commissioner, and then tax court.
field audit
Auditors can come to home or business in cases of complicated returns.
probability
Tax returns are more likely to have an audit if you have income greater than $60,000, large deductions, many deductions, cash income, casualty claims, conflict between reported and W-2 income, or conflict between 1099 and reported interest or dividends. Auditing is by random selection or in response to an informer who thinks people broke tax law.
time
If people did not file a tax return, IRS has unlimited time. IRS must question tax returns within three years of due date, unless it suspects fraud or gross income misstatement. If IRS claims fraud or gross misstatement, limit is six years for criminal charges. In case of fraud, IRS has unlimited time to attempt to recover due tax, plus penalties and interest.
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Date Modified: 2022.0224