CONTINUING EDUCATION FOR TAX & FINANCIAL PROFESSIONALS
Subscribe
Login
Main Menu
Main Menu
Account
Cart

Millionaire Audits, IRS Resources, Trump’s Taxes, OH MY

1 Audit, 2 Audits, No Audits, Few Audits:

During fiscal year (FY) 2022, few millionaires were audited compared to lower-income examinations, which continued to occupy most of the IRS’s audit resources. That’s according to statistics compiled by the Transaction Records Access Clearinghouse (TRAC) at Syracuse University. Shocker.

  • The likelihood of a millionaire being audited by the IRS fell to 1.1% (7,710 agent-examined returns of 703,576 returns filed with total positive income (TPI) of $1 million or more.) In other words, barely over 1 out of every 100 millionaires were audited.
  • These results are based on internal IRS management reports released each month to the TRAC under a court order resulting from litigation under the Freedom of Information Act.

Note. The chart below shows a higher percentage of millionaire audits because it includes limited audits by tax auditors and by correspondence. The lowest income wage-earner’s return had a 12.7% audit rate, mostly because of the earned income tax credit.

The Problems Posed by Low-Income Taxpayer Audits

Low-income taxpayer audits, which occur primarily through the mail (known as correspondence audits), are one of the most serious problems plaguing the IRS and taxpayers, according to National Taxpayer Advocate Erin M. Collins. What makes this type of audit so troubling is that taxpayers are not assigned a single point of contact and struggle to reach anyone at the IRS to resolve the issue — a problem taxpayers and tax pros alike know all too well.

Trump’s Tax Returns Released:

Speaking of IRS audits of million-dollar income returns, Former President Trump’s tax returns were released by the Democrat-led House Ways and Means Committee last month. Determining whether that was a good idea or not is perhaps best for a another discussion over cocktails.

  • The committee originally released Trump’s tax returns in a tweet with a link to a zip file, which has since been removed.
  • At the request of the Ways and Means Committee, The Joint Committee on Taxation also released a report on its review of the 2015 to 2020 tax returns and the IRS audit file on the returns.

Expert Analysis on Trump’s Tax Returns:

Want to take a deeper dive into Trump’s tax returns? Our expert instructor Mark Seid has a one-hour webcast reviewing the returns from his perspective as an IRS Agent for 10 years and as a practicing CPA for 20 years. Check it out below.