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This just doesn’t make sense from a financial standpoint. It seems doubtful the money recovered covers the cost of the audits.
I can't imagine those are very expensive.
Curious timing given the expansion of the IRS. EDIT: why is this getting down voted?
This comment is likely being down voted because it provides zero analysis or factual content while appearing to be an attempt to stir the partisan pot.
There was talk during the Trump administration of bringing the tax code in line such that it could “fit on a large postcard” or something like that. That went out the window for the final bill. I have to imagine that tax simplification would provide as much benefit to revenue as boosting audit counts. I’m told in European countries that y’all have your taxes pre-calculated and sent to your homes? I’m flabbergasted th…
It is because Intuit and other large tax preparers have lobbied heavily against anything that makes taxes easier to file.
As the article states the "audits" are for the most part (~85% of the time) a letter sent to the person asking them to provide documentation for something. I would think most people think of an audit as having to meet in person with an IRS representative going over their taxes.
Quoted post unavailable.
There's one statistic that I didn't see but I'm now really curious about: what percentage of audits discover irregularities, per income level? If lower-income people are more likely than average to cheat on their taxes, then it makes sense to audit them more, but if they don't, then this is indeed totally unfair.
This may explain why (it is from the National Taxpayer Advocate Erin M. Collins' annual report to congress): The IRS correspondence audit process is structured to expend the least amount of resources to conduct the largest number of examinations – resulting in the lowest level of customer service to taxpayers having the greatest need for assistance.
The reason for this is almost entirely the Earned Income Tax Credit. The IRS estimates 21-26% of all EITC claims are improper. The rules are quite complex, which results in more errors and it is relatively straightforward for the IRS to detect certain classes of mistake or fraud through automation (i.e. to detect if the same child was claimed as a dependent by two different people on their return). Congress made the…
The IRS has publicly stated on a number of occasions they do not go after the wealthy because they do not have the resources to win in the ensuing legal battles.
This leaves the poor and middle class as the only groups they can target.
The reason for this is almost entirely the Earned Income Tax Credit. The IRS estimates 21-26% of all EITC claims are improper. The rules are quite complex, which results in more errors and it is relatively straightforward for the IRS to detect certain classes of mistake or fraud through automation (i.e. to detect if the same child was claimed as a dependent by two different people on their return). Congress made the…
If it's that complicated and they are doing audits anyways, can't they just automatically apply EITC without relying on people to figure out this stuff and how to claim it?
(and many would politically be against the data collection that would be logically necessary to determine many of the common credits/deductions)