IRS Audit Period Just Doubled From Three Years To Six Years For Many

Forbes reports:

No one wants to be audited, and knowing how long your tax return can be attacked is important. Most people know that the IRS statute of limitations is usually 3 years. But there are many exceptions that give the IRS 6 years or longer. And one of those six year exceptions just got bigger, way bigger, despite the U.S. Supreme Court.

The three years is doubled to six if you omitted more than 25% of your income. That is called a substantial understatement of income. But for years, the debate has been over what it means to omit more than 25%. The IRS argues it isn’t just gross income we’re talking about.

Just a reminder.