scope of audit after amendment

[bwinholt]

If a tax return is amended and an audit ensues, can the IRS audit the entire return or just the area(s) that were amended?

[jimmcg]

Audit

Original return is available for audit until the appropriate statute of limitation runs.

[DaveinTexas]

OP was inquiring about the scope

Interestingly, I have never (knock on my head) had an Amended Return selected for audit. I've had them rejected for missing documents/additional information, etc, but never for audit.

The scope of the audit depends on a lot of factors. I would suspect the areas that marked high DIF scores would be the main targets. The scope could be very narrow (specific to the item changed) or broad like in the case of a rookie TCO trying to wet their feet in a certain area of tax (for example, S Corporations). The scope can be further narrowed, however, by good negotiation techniques.

Sometimes the IDR asks for "every item" in Part V of Schedule C simply because the IRS computers give the TCO just a lump sum figure with no description of each expense category. If you happen to find yourself in a line by line audit by a new TCO learning the ropes, good luck my friend and charge the client accordingly! These types of audits were common in the 80's (so I've read) but not too common today...unless you get the newbie.

The goal of an audit and the goal of the TCO is to determine the correct amount of tax. AND, the IRS budget has been slashed which means much fewer audits and audits that will have a quick (or so they hope) outcome. Until the client receives the audit notification, don't sweat the small stuff

[jimmcg]

Scope

The potential scope is the entire original return until the statute runs.

[Gary2]

There must be more to this story. No one would suggest that if you file a return on April 15, and then amend it on August 1, that the IRS is now limited to reviewing just the amended information. So, what's really going on here? Is there a flaw on the original return that you (or the taxpayer) can't or won't fix?

[taxea]

the auditor must tell you what specifically is being looked at.