Fewer Audits For The Wealthy More For The Poor

No matter how you look at this pattern coming out of the IRS it only makes sense when you know that the poor taxpayer is more vulnerable and less armed to defend themselves against an audit. While the wealthy have accountants and lawyers who know all the tricks in the books, all the loopholes and would fight the IRS tooth and nail were they to come a’calling!

Low Hanging Fruit Is Easy Picking

Of course, the COVID-19 pandemic brought all audits to a halt for a couple of years, but now the IRS has some catching up to do. So, they pick on the lowest hanging fruit as the following points out. “A study from the U.S. Government Accountability Office, released this month, found that in recent years, the audit rate declined the most for taxpayers with annual incomes of $200,000 and higher. At the same time, the IRS audited taxpayers with incomes below $25,000 at higher-than-average rates, Accounting Today reported.” https://www.gobankingrates.com/taxes/tax-laws/tax-audit-rates-decrease-especially-for-those-earning-200k

The Government Accountability Office (GAO) conducted research that shows, “The reason audits of higher-income taxpayers declined more than others is that these audits “are generally more complex and require staff’s review. In contrast, “lower-income audits are generally more automated, allowing IRS to continue these audits even with fewer staff.” https://www.gobankingrates.com/taxes/tax-laws/tax-audit-rates-decrease-especially-for-those-earning-200k/

IRS Claims Earned Income Tax Credit (EITC) And Underreporting Are Big Concerns

Yes, we know that there are staffing and funding issues at the IRS. It’s a tough job, and somebody has to do it. I’m not sure how I would feel and what I might do were I in that position. Would I favor efficiency over effectiveness? Or quantity over quality. I like to think not. Meanwhile the people on the lowest income scale are being targeted because it makes someone else’s job easier. Little thought is given to the circumstances of families and businesses trying to keep the heads above water, keep food on the table and keep their children clothed and educated. It’s pretty much always the underdog that gets targeted by the IRS.

What Happens When The IRS Audits You And Find You Owe Them More Money

If you have been notified that the IRS is auditing you, here’s what can happen if you owe them more money and you have no way to pay. First, the IRS will start looking into your assets. If you own your car, they can seize it, sell it, and apply the funds to your tax debt. They can garnish your wages. In other words, the IRS can seize anything of value, because one way or another, the IRS will get their money. As I mentioned earlier, the wealthy have lawyers, sometimes teams of them to deflect and keep the IRS at bay. While those who claim less than $25,000 a year do not.

My Focus Is To Help The Underdog

I have built my entire law practice on working with and for the underdog engaged in IRS battles. I have helped thousands of taxpayers settle their debts and avoid disaster. If you are one of the taxpayers the IRS is plucking to audit, give my office a call. Let’s see if we can help you sleep better and night and avoid complicating or making matters worse.