“Eat the rich” is coming back into vogue as word has it the IRS is allegedly getting ready to massively audit the wealthy and large corporations in an effort to crack down on tax cheats.
“The agency received $80 billion in new funding as part of the Biden administration’s landmark Inflation Reduction Act legislation. Now the IRS has outlined its plans to use the funding to increase audit rates for particular groups – as well as improving lagging customer service,” the Daily Mail reported.
According to the New York Post, the IRS “plans to sharply increase audit rates for big corporations, partnerships and multimillionaires over the next three years after a massive boost in funding by the Biden administration.”
The audit rate will ostensibly double over the next three years and will specifically target wealthy Americans who earn more than $10 million a year. A 52-page document outlining the IRS’ plans also claims that complex partnerships with assets over $10 million will be audited at ten times the normal rate, according to the Daily Mail. The audit rate on large corporations with assets of $250 million or more is expected to triple.
The IRS says audits are about to surge — here’s who’s most at risk
In a news release,the IRS said that with the boost in funding by the current administration, over the next 3 years; they are aiming to nearly triple its’ audit rates for:
✔️Big corporations
✔️Partnerships… pic.twitter.com/ygwCdAzTLY— ❣️Anne❣️ (@USA_Anne711) May 5, 2024
Many argue this will cause the wealthy and big businesses to flee the country if it turns out to be true.
“Danny Werfel, IRS commissioner, reassured everyday Americans that the agency will not increase scrutiny of people who earn less than $400,000 a year – which covers the vast majority of US taxpayers,” the Daily Mail added.
It’s also being reported that low to middle-income taxpayers will make up the bulk of the audits as the IRS evidently has its new legion of auditors aimed at just about everyone.
“However, the IRS seeks more funds to accommodate its growing personnel over the coming years. Without additional funds, ‘the IRS will be forced to reduce its Enforcement staff by more than 50 percent in fiscal year 2030, severely hampering our ability to perform complex audits.’ A lack of funding could end up increasing the scrutiny on low-income filers, the IRS stated,” the Epoch Times reported.
Who is still a target of IRS audits?
Anyone with a job or who owns a business.— Michelle_Benavidez (XX) #AdultHumanFemale (@Michelle_B_76) May 2, 2024
“Since lower-income taxpayers are more likely to have simple tax returns, this lack of funding will likely translate into a higher share of audits falling on low- and middle-income taxpayers, while examination coverage rates for high-income and large corporate taxpayers will severely decline,” the IRS reportedly said.
The second most likely group of taxpayers to be audited are those who claim the Earned Income Tax Credit. Those tend to be low and middle-income taxpayers. They are twice as likely to be audited as others, according to data from 2020.
The Daily Mail cited a 2022 report from the National Taxpayer Advocate to note “about 8 in 10 audited returns that claimed the EITC had either incorrectly claimed a child or misreported income.”
Werfel asserted during a conference call with reporters that there is no plan for a new onslaught of audits against middle and lower-income households. The wording there seems somewhat suspect.
They never have enough
— Slow (@SlowLaneLodge) May 4, 2024
More revenue to piss away
— (@DroppedmicAgain) May 4, 2024
“This update also reflects our ongoing effort to make sure we focus compliance resources where they need to be,” he stated.
Databook reported that the IRS closed almost 583,000 tax return audits in 2023. That netted an additional $31.9 billion in taxes collected.
“Bolstered efforts to pursue high income, high wealth individuals who have either not filed their taxes or failed to pay recognized tax debt has led to the collection of $520 million so far, it said,” the Daily Mail concluded.
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Author: Terresa Monroe-Hamilton
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