How Long Is the Federal Tax Audit Period?

The audit period, or statute of limitations on assessment, is the timeframe the Internal Revenue Service (IRS) has to review your tax return and assess additional taxes. Once this window closes, the IRS is generally barred from auditing or changing your tax liability for that year.

The length of the audit period varies based on the accuracy of the return and the taxpayer’s actions. An audit’s purpose is to verify reported information and does not imply wrongdoing. The IRS may select a return for review through random selection or computer screening and initiates contact through official mail, not by phone.

The General Timeframe for an Audit

For most tax returns, the IRS operates under a three-year statute of limitations. This means the agency has three years to begin an audit, a rule that applies to taxpayers who have submitted an accurate return without significant errors. The clock for this period starts on the date the return was filed or its original due date, whichever is later.

To illustrate, consider a tax return for the 2024 tax year, which is due on April 15, 2025. If you file that return on March 20, 2025, the three-year audit window begins on April 15, 2025, and would close on April 15, 2028. Conversely, if you filed the same return late, on June 1, 2025, without an extension, the audit period would start on June 1, 2025, and end on June 1, 2028.

While the IRS has the full three years, it aims to conduct audits much sooner. Most audits are for returns filed within the last two years, allowing the agency time to complete its examination before the statute of limitations expires.

Circumstances That Extend the Audit Period

Certain actions can extend the standard three-year rule. A six-year rule is triggered by a “substantial understatement of income,” which occurs if a taxpayer omits more than 25% of the gross income that should have been reported on the return. For example, if a taxpayer reported $80,000 in gross income but actually earned $120,000, the $40,000 omission is more than 25% of the reported amount, giving the IRS six years to assess additional tax.

The audit period also extends to six years if a taxpayer fails to report more than $5,000 of income from foreign financial assets. This provision is part of a broader effort by the IRS to address offshore tax evasion and ensure all global income is properly reported by U.S. taxpayers.

In more severe cases, the statute of limitations may never close, allowing the IRS to initiate an audit at any point. This indefinite period applies when filing a fraudulent return or failing to file a return altogether. If the IRS can prove a taxpayer willfully attempted to evade taxes, or if a required return was never filed, the clock on the audit period never starts.

How the Audit Period Begins

If a taxpayer gets an extension to file, the start date for the statute of limitations shifts. For a return with an extension to October 15, the audit period would begin on the date the return is actually filed, as long as it is on or before the extended due date. If the return is filed after the extension deadline, the clock starts on the actual filing date.

Filing an amended return does not extend the original three-year statute of limitations for the entire return. However, a special rule applies if you file an amended return that shows an increase in your tax liability within the final 60 days of the original three-year audit period. In this situation, the IRS is granted an additional 60 days from the date it receives the amended return to assess the extra tax. An amended return that does not report an increase in tax does not grant the IRS any additional time.

State-Level Audit Periods

Taxpayers must also consider that each state has its own tax laws and audit periods. These timeframes are not always aligned with the federal three-year rule and can be longer. It is a common practice for states to have a standard audit window of three to four years, but this can vary.

Many state tax laws are structured for “piggybacking.” If a federal audit by the IRS results in a change to a taxpayer’s federal adjusted gross income, the statute of limitations for the corresponding state return is automatically extended. This allows the state tax agency time to assess additional state tax based on the federal changes. Taxpayers are typically required to notify their state tax agency of any changes from a federal audit.

Because these rules differ from one state to another, it is important for taxpayers to consult the specific regulations from their state’s department of revenue. For example, one state might have a four-year general statute of limitations, while another has a three-year period that extends to six years under circumstances similar to the federal rules.