The IRS Commissioner announced as part of its strategic plan, the intention to ramp up audits over the next three years as it looks for additional revenue, but not every group of taxpayers will face more scrutiny. The agency reiterated it won’t boost enforcement for taxpayers that earn less than $400,000 annually, at least for now. More audits are necessary to bridge the underfunding gap that has resulted in longer wait times, months-long processing delays and an overall decline in customer service.
The IRS will focus on wealthy individuals and large corporations by:
- Tripling the audit rates on large corporations with assets of more than $250 million (audit selection rates will rise to 22.6% in tax year 2026 from 8.8% in 2019).
- Increasing audit rates tenfold for large partnerships with assets of more than $10 million (audit selection rates rising to 1% in tax year 2026 from 0.1% in 2019).
- Focusing on wealthy individuals with incomes over $10 million will see a 50% uptick in audits (selection rate up to 16.5% in 2026 from 11% coverage in 2019).
For more information or assistance with an IRS audit, contact your Tronconi Segarra & Associates LLP advisor.
