The TRUTH about the IRS's Clock

Ever wondered how far back the IRS can go to audit you?

How far back can I claim my refund?

Well, generally the IRS has three year to open an audit from the date the tax return is due.

Three-Year Statue of Limitations

Let's say you file your individual tax return for tax year 2021 on time, and the due date is 04/18/2022; the three-year statute of limitation date is 04/18/2025. After that date, the IRS cannot audit you, with a few exceptions, which we will discuss later…

What about my refund?

It’s the same with tax refunds. If you are supposed to have a refund in 2021, generally your last date to file an individual tax return to get your money back is 04/18/2025.

If you try to file now for your 2021 tax refund, the e-file is most likely closed for 2021, and you will have to submit a paper return. I highly recommend mailing it with certified mail with a tracking number. This shows the postmark date, and someone will sign for acceptance mail at the IRS office.

The Exceptions…

According to the IRS website, here are the exceptions that the IRS Three-Year of Limitation will not apply:

• Didn’t file your tax return- If you never file your tax return, the IRS can go back beyond the three years to audit. So the rule of thumb is to file anyway, so you set the three-year statute of limitation clock on your side.

• You sign the agreement with the IRS and agree for them to extent the assessment.

• Reported 25% less of your income on your tax return.

• File a fraudulent return to avoid tax.

What if I filed for an extension till October?

Well, the clock works the same way. Let’s say you filed late on October 31, 2021. The three-year statute of limitation runs until October 31, 2025.

For more tax-saving tips, check out K’s Tax Service YouTube channel.