I recently had a conversation with a friend in which he mentioned his happiness over receiving his tax refund.* He was very happy that he recieved a tax credit, becuase he heard a rumor that the government had run out of money to pay certain credits. In his case, this is probably no true, but it brought up an interesting point.
The IRS can in fact audit a person's tax return at any time before the statute of limitation expires. This means that a person's tax bill can change- every once in a while people acutally owe less tax than they calculated on their own. For non-fraudulent returns this period is usually three years. If the tax return presents fraudulent information, then the statue can increase up to seven years.
If the government really had allocated only a certain amount of money to be used for certain tax credits, and someone received a check after that money had really been exhausted, I assume that the IRS could try to claim that money back, but it seems unlikely to me (then again, we haven't seen quite as many tax incentives recently as we've had this year).
In any event, the statute of limitations starts running on the later of the return's original due date or the date the return is actually filed. This is important, because if you don't file a return for a particular year the statute never starts running. Becasue of this, it's often better to file some return on time** and amend it later if it was wrong rather than waiting to file until you're 100% sure it's correct
*A tax refund is the money you receive if you overpaid your actual tax liability shown on your tax return. A tax return is the form (i.e. 1040) that you file with the IRS.
**By either the standard April 15th deadline or by the extended dealine of October 15.
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