From the U.S. Government Accountability Office, www.gao.gov

Transcript for: IRS: Challenges in High-Income/High-Wealth Audits

Description: To address the decline in audit rates for the
highest-income taxpayers, in February 2020, the Department of Treasury
directed IRS to audit at least 8 percent of individuals with adjusted
gross income of $10 million or more. GAO found that IRS is on track to
meet the 8 percent audit rate goal for tax years 2018 to 2020. While
IRS has increased the number of these audits, there are areas for
improvement. GAO is making eight recommendations to improve IRS's
efforts to audit high-income/high-wealth individuals, including taking
steps to assess its research efforts, audit selection models, and
auditor hiring and training. 

Related GAO Works: GAO-24-106112, Tax Compliance: Opportunities Exist to
Improve IRS High-Income/High-Wealth Audits

Released: February 2024

[ Text On-Screen ]

In 2020, the Department of the Treasury directed IRS to audit at least
8% of tax returns filed by individuals with income of $10 million or
more. While IRS has increased the number of these audits, IRS still
needs to assess its:
 
* Research efforts to understand the complexity and compliance issues of
high-income returns.

* Audit selection models to ensure IRS is not burdening compliant
taxpayers.

* Auditor hiring and training needs to address any staffing and skill
gaps.

* Finally, IRS should centralize its management of high-income,
high-wealth audit programs.

Our 8 recommendations address these issues.

[ End ]

For more info, check out our report GAO-24-106112 at: GAO.gov