Can the IRS Audit After Accepting Your Tax Return?

Understanding IRS Acceptance

When you file your tax return, “acceptance” by the Internal Revenue Service (IRS) means their system has received your submission and performed a preliminary check for basic administrative errors. These checks verify Social Security numbers, confirm dependents are not claimed multiple times, and ensure all necessary forms are included. This automated process confirms the return is free from immediate technical flaws.

However, this acceptance does not signify a comprehensive review or full approval of your tax return’s accuracy. It is a processing acknowledgment, not a substantive audit or verification of your reported financial information. The IRS does not, at this stage, verify income, deductions, or credits against third-party records. Your accepted return remains subject to further scrutiny.

IRS Audit Timeframes

The Internal Revenue Service retains the authority to audit tax returns even after initial acceptance. For most returns, the IRS generally has a three-year period to initiate an audit. This timeframe typically begins from the date you filed your return or the tax return’s due date, whichever is later. For example, if you filed your 2022 tax return on April 15, 2023, the IRS can generally audit that return until April 15, 2026.

Several exceptions can extend this three-year window. If you substantially understate your gross income by more than 25% on your return, or omit more than $5,000 of foreign income, the IRS has six years to conduct an audit.

The statute of limitations can be indefinite in certain situations. There is no time limit for an IRS audit if a taxpayer files a fraudulent return or fails to file a return at all. Amended returns generally do not restart the entire statute of limitations, but they can extend the period for issues related to the changes made on the amended return.

Common Reasons for an Audit

Even after a tax return is initially accepted, specific factors can increase the likelihood of an audit. One common trigger is unreported income, where the income stated on your return does not match information the IRS receives from third parties, such as W-2s or 1099s. These discrepancies often lead to an automated inquiry, like a CP2000 notice.

Unusually high deductions relative to your income or compared to similar taxpayers can also attract attention. This includes large charitable contributions, particularly non-cash donations, if not properly substantiated. Self-employed individuals and small business owners reporting significant business losses, especially those that consistently show losses or appear disproportionate to income, may also face scrutiny. The IRS also examines returns with complex investments, foreign accounts, or those claiming 100% business use of a vehicle. While random selection does occur, most audits are triggered by specific red flags identified through computer screening.

Navigating an IRS Audit

If the IRS decides to examine your tax return after initial acceptance, you will typically receive a notice by mail, such as a CP2000 for income discrepancies or a formal audit letter. A CP2000 notice is an underreporter inquiry, not a formal audit, but a proposal to adjust your tax liability based on mismatched information. Formal audits can range from correspondence audits, handled by mail, to office audits at an IRS office, or field audits conducted at your home or business.

During an audit, the IRS will request documentation and records to verify your reported income, deductions, and credits. Provide all requested information promptly and accurately. Taxpayers have specific rights during an audit, including the right to professional representation by an attorney, certified public accountant, or enrolled agent. You also have the right to privacy, confidentiality, and to appeal any audit findings you disagree with, both within the IRS Office of Appeals and in tax court.