MIDDLE CLASS TO SEE ADDITIONAL AUDITS
October 3, 2022 - Douglas Myser
Middle class to see additional audits. According to the Republicans in the House, Americans earning less than $75,000 a year are going to receive nearly 60% of the increased audits that will be performed by the IRS, once they gear up from the increased funding they just received from Congress. The reason for that is that the IRS will be targeting not just the wealthy, but also self-employed business owners, who have expenses that they typically deduct from taxable income, and tend to inflate those expenses to offset the amount of tax they will have to pay. After years of under funding, with a growing deficit and calls for additional spending measures due to the pandemic, a simple way to fund both is increased IRS funding, which needs to be done anyway, as the service at the IRS is horrendous. The National Taxpayer Advocate stated that in 2021 only 12% of all phone calls made to the IRS were answered. Middle class to see additional audits.
The filing data shows that individuals with an annual income of $75,000 or less would be subject to nearly 700,000 additional audits while those making more than $1 million would receive about 52,000 more audits under the bill. Of course that statistic is deceiving in the fact that there are substantially less millionaires than those making less than $1 million a year. To increase tax enforcement, the Inflation Reduction Act would use more than $79 billion in the bill to boost the IRS ability to go after tax cheats and those who are gaming the system. The IRS is expected to hire nearly 87,000 additional people over the next year and a half, and it will take a good six months to a year to train them. Middle class to see additional audits.
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