More Agents - More Audits: Those Under $400K Could Be Targeted By IRS

Evan Poellinger | September 18, 2023
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The Internal Revenue Service (IRS) is planning to hire an additional 3,700 agents, allegedly to
facilitate auditing of high-income earners who are attempting to avoid income taxes.

In a news release from September 15, the IRS announced that it had opened 3,700 additional positions with the organization, which it said were designed to assist with “expanded enforcement work focusing on complex partnerships and large corporations.”

The IRS seems to have already taken steps to ensure that the hiring of more personnel does not
induce a panic or newfound outrage among taxpayers. IRS Commissioner Danny Werfel stated
that the new hires “will be focused on higher-income and complex tax areas like partnerships,
not average taxpayers making less than $400,000.”

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Werfel added that he hoped that this would “reverse a decade-long decline of audits for the wealthy as well as complex partnerships and corporations.”

However, a government watchdog has already raised concerns that the IRS may be obfuscating
the true scope of their newly-strengthened enforcement. According to a report from the Treasury
Inspector General for Tax Administration (TIGTA),
the IRS “made no changes to the income
thresholds for high-income high-wealth taxpayers” from the threshold of $200,000 established in

The report noted that $200,000 in 1976 is now equivalent to $1,088,223 at present.

Despite the TIGTA’s recommendation that the IRS should “establish a definition for high-
income taxpayers in reference to examination compliance,” the IRS disputed the
recommendation, asserting that “a static and overly proscriptive definition” would “deprive the
IRS of agility to address emerging issues and trends.”

Effectively, this means that a number of taxpayers paying less than $400,000 will still be subject to potential auditing and unwarranted scrutiny.

It looks like the IRS will continue to hound even those who ostensibly fall outside the newest threshold of high-income earners.

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