Nearly half of IRS audits aimed at poorest taxpayers: Study

The Washington Times | by Stephen Dinan | March 8, 2022

Nearly half of all audits the IRS conducted in 2021 were aimed at the country’s poorest taxpayers, according to a new study that called the ratio unfair.

The Transactional Records Access Clearinghouse (TRAC) said the IRS conducted nearly 660,000 audits in the last fiscal year, and about 307,000 of them targeted taxpayers who claim the Earned Income Tax Credit, aimed at the working poor.

Or, put another way, those claiming the tax credit were audited at a rate of 13 per 1,000 returns, while the rest of the country was audited at a rate of 2.6 per 1,000 returns.

“Does it make sense from either an equity or revenue standpoint to focus IRS’s limited firepower on the poorest taxpayers among us – those with incomes so low they have filed returns claiming an anti-poverty earned income tax credit? This question alone raises profound issues,” said TRAC, which is housed at Syracuse University.

TRAC said the IRS can get more bang for its buck by going after wealthier taxpayers, but instead boosted its numbers by going after returns that claim the tax credit, using what’s known as a “correspondence audit.”

Source: Nearly half of IRS audits aimed at poorest taxpayers: Study – Washington Times