Summary: IRS Failed to Collect $2.4B in Taxes from Millionaires

Recently, the Internal Revenue Service has failed to collect over:

• 2.4 Billion dollars from wealthy Americans who owe the federal government in tax.
• This was found when auditors were only able to collect: 39% of more than $4 Billion in unpaid taxes from those who earn over 1.6 Million dollars annually.

This finding suggests that the IRS should be paying more attention to the taxpayer’s income rather than just the dollar amount when deciding whether to pursue an audit case actively. According to the latest government accountability reports, the IRS’s intent to pursue high-income taxpayer’s unpaid taxes has dipped to a record low. However, the IRS disputes this recommendation to focus on the annual income amount rather than just the dollar amount of taxes owed. The IRS claims that their predictive models used in case of selection when determining to pursue an audit are based on “robust historical data sets.” The agency announced that they also plan to increase their audits on small businesses and investors by 50% this year. The IRS will be focusing on targeting illegitimate and abusive cryptocurrency and land-conservation deals.

Source: https://www.accountingtoday.com/articles/irs-failed-to-collect-2-4b-in-taxes-from-millionaires

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