Did you know that taxpayers have the right to know when the IRS has finished an audit and the maximum amount of time the IRS has to assess additional tax or collect unpaid taxes?
We were reminded by the IRS in an email IRS Tax Tip 2023-101 and thought we would share it with you! There were some key points from that tax tip:
- The IRS generally has three years from the date taxpayers file their returns to assess any additional tax for that tax year. However, there are some exceptions to this rule, such as when taxpayers fail to file returns or file false or fraudulent returns.
- The IRS generally has 10 years from the assessment date to collect unpaid taxes. However, there are some circumstances when the 10-year collection period may be suspended, such as when the IRS can't collect the unpaid tax due to the taxpayer's bankruptcy.
- A statutory notice of deficiency is a letter proposing additional tax the taxpayer owes. This notice must include the deadline for filing a petition with the tax court to challenge the amount proposed.
- Generally, a taxpayer can be subject to only one audit per tax year. However, the IRS may reopen an audit for a previous tax year if the agency finds it necessary.
If you've got questions, we can help! Contact us today.
Credit: This information is available from the IRS website: https://www.irs.gov/newsroom/everyone-has-the-right-to-finality-when-working-with-the-irs