In the United States, an income tax audit is the examination of a business or individual tax return by the Internal Revenue Service (IRS) or state tax authority. The IRS and various state revenue departments use the terms audit, examination, review, and notice to describe various aspects of enforcement and administration of the tax laws.

The IRS enforces the U.S. Federal tax law primarily through the examination of tax returns that have the highest potential for noncompliance. According to the IRS, "[t]his identification is determined using risk-based scoring mechanisms, data driven algorithms, third party information, whistleblowers and information provided by the taxpayer. The objective of an examination is to determine if income, expenses and credits are being reported accurately."

Generally, the IRS will contact a taxpayer who has been selected for audit by mail, rather than initiating an audit by phone call or in person.

The following are examples of documentation that the IRS may request: receipts, invoices, bank statements, and cancelled checks. Some electronic versions of documentation are acceptable. A good practice is to organize these documents by their tax year, and to provide the total amount summary in addition to the detailed transaction. If the taxpayer cannot provide source documentation for a particular amount, the taxpayer may explain why the document was missing and how the amount was calculated. The IRS will often ask that the taxpayer send only copies of these documents, as originals can get lost or damaged.

Examinations of documents are conducted either by mail or in a taxpayer’s home, business, or an accountant’s office. In-person review is preferred if a large amount of documentation is required. Further instructions and contact information is provided in the IRS Notice Letter.

The IRS or a tax authority can audit a tax return supported by its documentation and either conclude that there is no change, the taxpayer agreed, or the taxpayer disagreed. "No change" means the original amount owed or being refunded in the original tax return shall remain the same. On the other hand, IRS can propose a new amount in which the taxpayer can either agree or disagree with such amount. By agreeing, the taxpayer must sign an agreement and may have to pay the additional amount. If a taxpayer disagrees, they may request a meeting with an IRS manager, file an appeal, or participate in an Appeal Mediation, where an appeal officer will help resolve the case.

The purpose of a tax audit or a return examination is to determine whether reports filed with the taxing authorities are correct. The tax agencies identify and resolve taxpayer errors.

There are several different methods used to select individuals and businesses for examination.