New IRS data shows:
- Millionaires in 2018 ~80% less likely to be audited than they were in 2011
- The top 1% of taxpayers by income were audited at a rate of 1.56%
- EITC recipients, who typically have annual income under $20,000, were audited at 1.41%
propublica.org/article/irs-no
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“In the 2019 fiscal year, among other problems, the IRS was late in sending legitimate refunds to many taxpayers and failed to answer the majority of phone calls from taxpayers. The agency also failed to collect billions in unpaid taxes.”
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A new report from the Treasury IG for Tax Administration finds the IRS is failing to collect billions in unpaid taxes from hundreds of thousands of individuals.
The IRS estimates this is costing the average U.S. household an annual surtax of over $3,000.
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"Among the most acute customer service lapses in 2020: Employees answered just 1 in 4 of more than 100 million calls to the IRS’s toll-free telephone lines, leaving the rest unanswered or directed to automated responses”
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"The top sliver of high-income Americans dodge significantly more in income taxes than the Internal Revenue Service’s methods had previously assumed, according to forthcoming estimates from IRS researchers and academic economists.”
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"As much as $1 trillion a year in federal taxes may be going unpaid because of errors, fraud and lack of resources to enforce collections adequately, Internal Revenue Service Commissioner Charles Rettig told lawmakers Tuesday.”
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The IRS "lost a net 15% of its employees between 2010 and 2020 … It opens about half as many criminal investigations as in 2010. … At least $381 billion in taxes owed goes uncollected annually, according to agency estimates”
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White House seeks to make massive boost to IRS enforcement centerpiece of new spending plan
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The Treasury Department on Thursday unveiled a plan to raise an additional $700 billion over 10 years through new tax compliance measures.
The plan includes funding for 5,000 new enforcement personnel.
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“[During the Trump administration] Internal Revenue Service officers who collect delinquent taxes fell by 19.6 percent … [it] lost 20,000 employees since 2010, 1/3 in the enforcement division, as a result of Republican-led budget cuts, agency data shows.”
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A new report from a government watchdog found that the IRS closed the most recent filing season with more than 35 million unprocessed tax returns, a fourfold increase from 2019.
It could cause millions of taxpayers to wait much longer for tax refunds.
washingtonpost.com/us-policy/2021
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“The fed govt now examines just 1/2 of all large company tax returns despite businesses claiming increasing tax benefits…Companies currently in the S&P 500 index had $235b in tax breaks awaiting audit at the end of last year, up 43% from a decade earlier” washingtonpost.com/business/2021/
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"The wealthiest 1 percent of Americans are the nation’s most egregious tax evaders, failing to pay as much as $163 billion in owed taxes per year, according to a Treasury Department report released on Wednesday.” nytimes.com/2021/09/08/bus
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"Treasury Sec Janet Yellen & IRS Comm'r Charles Rettig pressed lawmakers Wednesday to give the IRS more info about taxpayers’ bank accounts…after opposition from banks & credit unions, House Dems omitted the proposal from…tax-policy changes this week”
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"Treasury officials predicted a 'frustrating season' for taxpayers and tax preparers as a result of delays caused by the pandemic, years of budget cuts to the IRS and the federal stimulus measures that have added to the tax agency’s workload.”
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"Nearly 24 million taxpayers are still waiting for the Internal Revenue Service to process their tax returns from last year — a number far larger than previously reported by the agency — with many refunds being held up for 10 months or more.”
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"The Internal Revenue Service plans to hire 10,000 employees in a push to cut into its backlog of tens of millions of tax returns by recruiting for jobs across the agency that have gone unfilled for years, according to four people familiar with the plan.”
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"More than 21 million paper tax returns are still waiting for processing by the Internal Revenue Service, as the tax agency struggles to swiftly disburse refunds to American households, according to a watchdog report released Wednesday.”
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"The Internal Revenue Service is planning to spend the first big chunk of its $80 billion expanded budget to hire people who will answer taxpayers’ telephone calls during the 2023 tax-filing season."
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"Before Donald J. Trump became president and after, his exceedingly complex and voluminous tax returns came under regular scrutiny by the Internal Revenue Service. The number of agents assigned to the audit team: one."
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"The Internal Revenue Service reduced its massive backlog of unprocessed tax returns by nearly two-thirds over the past year, an independent watchdog said Wednesday, which could lead to shorter delays for tax refunds."
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"Black taxpayers are at least 3x as likely to be audited by the IRS as other taxpayers, even after accounting for differences in types of returns each group is most likely to file...[showing] discrimination in the computer algorithms the agency uses"
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