Taxation & Estate Planning

IRS INCREASES AUDIT ACTIVITY

By Charles Rubin

The IRS has released information in regard to its 2007 audit and enforcement activity. The information shows a clear trend towards more audits.

Audits of individuals with more than $1 million in income increased 84% over the prior year. 1 out of 11 of such taxpayers were audited in 2007. For all taxpayers, audits were up 7%. The IRS filed 3.8 million levies and 700,000 liens.

In the business arena, the IRS has stepped up its activities for flow-through entities, such as S corporations and partnerships. Audits of those entities were up 26% and 25%, respectively. Audits of large corporations were down slightly.

Some other miscellaneous info:

-57% of all taxpayers now file their returns electronically;

-the IRS accuracy was 91 percent on tax law questions answered through its toll-free telephone service (good news, except for the 9% getting wrong answers!);

-the IRS online system for tracking refunds was accessed 32.1 million times.

Full post as published by Rubin on Tax on January 25, 2008 (boomark / email).