Paul L. Caron

Sunday, April 8, 2007

TIGTA: Number of IRS Audits Increasing, But Still Below 1990s Levels

Tigta_logoThe Treasury Inspector General for Tax Administration has released Trends in Compliance Activities Through Fiscal Year 2006:

Many compliance activities increased and results improved during Fiscal Year 2006. Since FY 2000, the IRS has been reversing many of the downward trends in compliance activities that had occurred in prior years. ...  The use of collection enforcement tools was greater and enforcement revenue collected continued to increase (to $48.7 billion), but the total dollar amount of uncollected liabilities increased to $271 billion. ...

The overall percentage of tax returns examined increased by just over 4%, and the number of field examiners increased by just over 9%. However, the percentage of tax returns examined is still 27% lower than it was in FY 1997. The number of tax returns of individuals examined increased. However, 82% were conducted via correspondence examinations, which are usually not as comprehensive as face‑to‑face examinations. The number of corporate tax returns examined decreased 1%, after increasing 71% in FY 2005. However, the number of these examinations has decreased 59% since FY 1997. Continued effort to improve compliance is important to the integrity of the voluntary compliance system.

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