Key Takeaways.
Your tax returns can be audited even after you've been issued a refund.
Only a small percentage of U.S. taxpayers' returns are audited each year.
The IRS can audit returns for up to three prior tax years and, in some cases, go back even further.Jan 10, 2022.
Audit changes to your tax return generally lead to additional tax liabilities, but in some cases, the changes can lead to a tax refund where the IRS owes you money.
If you agree with the changes, you simply need to make arrangements to pay your tax bill (or accept your refund check)..
Does a large tax refund trigger an audit? A large tax refund in itself is not a red flag.
However, if the refund is a result of fraudulent claims, such as inaccurately reporting income or claiming deductions you are not actually eligible for, then it can trigger an IRS audit.Jun 19, 2019.
Once a return has been audited, it may take the IRS up to 120 days or more to issue the refund.
The “Where's My Refund” tracker allows you to check on all three stages of refund processing: (.
1) Return Received, (.
2) Refund Approved, and (.
3) Refund Sent..
More from Smart Tax Planning:
Here's a look at more tax-planning news.
The IRS audited 3.8 out of every 1,000 returns, or 0.38%, during the fiscal year 2022, down from 0.41% in 2021, according to a recent report from Syracuse University's Transactional Records Access Clearinghouse.Feb 3, 2023.
After the IRS approves your refund it can take several days for your bank to process and post the direct deposit to your account.
Some institutions will issue your direct deposit on the same business day.
However, the time it takes can depend on how busy your bank or credit union is..
shows the status of my refund is Refund Approved? This means the IRS has processed your return and has approved your refund.
The IRS is now preparing to send your refund to your bank or directly to you in the mail if you requested a paper check..
If the IRS audits you, you’ll get a notice telling you that the IRS selected your return for examination
Dealing with the IRS in an audit can be difficult
The best course of action is to respond on time, thoroughly, and advocate your tax return position
The IRS may select a return for audit if it involves issues or transactions with other taxpayers—such as business partners or investors—whose returns were selected for audit
The IRS mainly conducts its tax audits via mail or personal interviews at local IRS offices or "in the field" at your business or home
What Can Trigger a Tax Audit?
An acceptance from the IRS or an approval of a refund does not mean that your return will not be selected for audit
It is not uncommon for the IRS to audit tax returns going back three years or longer
Be assured, however, that the process is not as scary as it sounds
