Tax Administration: IRS Should Continue to Expand Reporting on Its Enforcement Efforts
Highlights
Reported declines in the rate at which the Internal Revenue Service (IRS) audits (also referred to as "examines") individual income tax returns have raised concerns that taxpayers may have a false perception of the true level of IRS's tax enforcement efforts. In addition, many observers are concerned these reported declines may reduce taxpayers' motivation to voluntarily pay their taxes. Because of these concerns, GAO was asked to review a number of issues surrounding IRS's enforcement efforts. GAO determined the trends in the percent of returns filed that are audited (contact rate) compared with similar data on taxpayer contacts through other enforcement programs for fiscal years 1993 through 2002. In addition, GAO reviewed whether IRS's reporting on its enforcement programs should be expanded.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Internal Revenue Service | The Acting Commissioner of Internal Revenue should determine whether additional data on each nonaudit program can be cost effectively extracted or collected to make future annual reporting on enforcement programs more complete and comparable. |
IRS has determined that it could cost-effectively provide some more data in its annual report (databook) on math errors, automated substitute for return, and the automated underreporter program. The fiscal year 2003 edition adds a table 26 to provide this data.
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| Internal Revenue Service | The Acting Commissioner of Internal Revenue should provide information on all types of math error contacts when publishing data on IRS's math error program. |
In the year following publication of GAO's report, IRS' annual Data Book included an analysis of Math Error contacts by type of error including masterfile math errors.
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