Saturday, Might 21, 2022
GAO: IRS Audit Charges Plummet For The Wealthy
GAO, Tax Compliance: IRS Audit Tendencies for Particular person Taxpayers Differ by Revenue:
From tax years 2010 to 2019, audit charges of particular person tax returns decreased for all revenue ranges. On common, particular person tax returns have been audited over thrice extra usually for tax yr 2010 (about 0.9 p.c) than for tax yr 2019 (0.25 p.c). Audit charges for taxpayers with incomes of $200,000 and above decreased probably the most, largely as a result of higher-income audits are usually extra difficult and require auditors to manually overview a number of points, in keeping with IRS officers. As a result of audit staffing has decreased, IRS can not conduct as many of those audits, in comparison with lower-income audits, that are typically much less complicated and contain extra automated processes. As well as, IRS officers said that the variety of returns filed by higher-income populations is rising, that means extra audits are wanted to realize the identical audit price.
Though audit charges decreased probably the most for higher-income taxpayers throughout this time interval, IRS continued to audit higher-income taxpayers at larger charges than lower-income taxpayers, on the whole. Nonetheless, IRS audited taxpayers claiming the Earned Revenue Tax Credit score (EITC) at the next price than common (see fig. 1, utilizing tax yr 2019 for instance). IRS officers defined that EITC audits are restricted in scope and traditionally have excessive charges of improper funds and due to this fact require a higher enforcement presence.
Audits of the bottom revenue taxpayers, significantly these claiming the EITC, resulted in larger quantities of advisable further tax per audit hour in comparison with all however the highest revenue group.
https://taxprof.typepad.com/taxprof_blog/2022/05/gao-irs-audit-rates-plummet-for-the-rich.html
