Houston Tax Attorney
I got a IRS letter about 2013 tax audit. No issues here and in fact I had missed one deduction previously and so I will get more money in my pocket. I spoke to the IRS person before the deadline and he gave me 30 days time for provide following documents
(1) Copy of filed Tax returns from 2010 till 2015 – Does n’t IRS already have them? Why is IRS Officer asking me to provide all 6 years when the audit is only for 2013? Is there any trick involved? I have no problem in providing all 6 years and I can add one deduction which I missed by mistake in last 6 years. It is just time consuming to collect information for 6 year.
(2) bank statements from Dec 2012 till Jan 2014 – No issues. I can provide them
A: There are a couple of scenarios where the IRS would pick up so many additional years for audit:
1. There is evidence of tax fraud. In such cases the statute of limitations allows the IRS to go back 6 years.
2. You filed your tax returns late and there is time on the statute of limitations for 2010 -2012. Normally, the 3 year statute would have expired for 2010-2012, unless you file the tax returns late.
3. You have carryovers such as NOL or capital losses. If you have a large capital loss, for example, in 2012 that was carried forward from 2010, the auditor may want to look at your 2010 return. If the statute for 2010 has expired, the auditor can still request a copy of the return to verify the carryover but cannot make adjustments to the 2010 return.
The fact that your bank statements were also requested leads me to believe that you are being audited for financial status – the IRS believes you may be underreporting your income.
I highly recommend that you retain an attorney to protect your rights before you submit any further documents to the IRS. You should do so before the 30 day time period lapses.
– Law Office of Kunal Patel, LLC