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Tuesday, April 29, 2008

TIGTA: Audit Rate of Largest Corporations Down 20%

The Treasury Inspector General for Tax Administration yesterday released an audit report, Trends in Compliance Activities Through Fiscal Year 2007 (2008-30-095), which found:

  • Enforcement revenue collected increased to $59.2 billion
  • Total dollar amount of uncollected tax liabilities increased to $290 billion
  • Gap between new delinquent account receipts and closures by 63%
  • Overall percentage of tax returns examined increased by 9%
  • 83% of examinations were correspondence examinations
  • Number of field examiners decreased by 4%
  • Corporate tax audit rate increased by 4% (but are still down 45% since 1998)
  • Audit rate of largest corporations (> $250 million assets) decreased by 20%
  • Audit rate of smallest corporations (< $10 million assets) increased by 12%
  • Audit rate of corporations with assets > $10 million decreased by 9%

See also IRS Audits of Big Companies Fall to All-Time Low (4/14/08).

http://taxprof.typepad.com/taxprof_blog/2008/04/tigta-audit-rat.html

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Comments

If one reflects on it, the substantial tax disclosure requirements that Congress and the Treasury Department have imposed on major corporations in the last 6-7 years -- plus SOX -- arguably should lead to a lower audit rate. At least that should be the case if major corporations take the new disclosure requirements seriously, and the officials who read those disclosures do so as well.

Posted by: Jake | Apr 29, 2008 8:53:18 PM