Millionaires' audit chances fell 36% last year - USA Today

[JohnWxy]

http://www.usatoday.com/money/perfi/taxes/2009-03-22-audits-millionaires-irs_N.htm

IRS audits of taxpayers with income of $1 million or more declined by more than a third last year, despite the agency's claims that it stepped up scrutiny of wealthy taxpayers, a new study says.
Audits of wealthy taxpayers dropped at least 36% in fiscal 2008 from 2007, according to a report released today by the Transactional Records Access Clearinghouse. TRAC is a research group affiliated with Syracuse University.

~~

The IRS disagrees with TRAC's analysis and stands by its earlier report, IRS spokesman Terry Lemons said.

Several studies have shown that wealthy taxpayers are more likely to hide income from the IRS. Taxpayers with adjusted gross incomes of $500,000 to $1 million fail to report 21% of their income on average, vs. 7% for those earning $40,000 to $50,000, according to a 2008 analysis by Joel Slemrod, a University of Michigan economics professor, and IRS economist Andrew Johns.

The TRAC report also found that face-to-face audits of wealthy taxpayers have plummeted even more than overall audits. Only 3.1% of wealthy taxpayers were subjected to a face-to-face audit in 2008, the same level as five years ago, the report found. The remaining wealthy taxpayers were subjected to less-intensive correspondence audits, which are conducted by mail.

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Note: .21 * $1,000,000 = $210,000

.07 * $50,000 = $3,500

[Andy823]

1. Ah, the good old days

8 years of Bush was great, if you were rich, and it looks like the rich not only made more money during those years, abut also got away with paying "less" in taxes because they had a lower chance of ever being audited.

Nobody knows how many trillions of dollars are stashed away in offshore bank accounts, but if the IRS was able to get the information, just think of the billions in taxes they could collect from those "patriotic" crooks who have been cheating the system!

[aquart]

2. And it's time we mentioned their lack of patriotism.

Not only do they refuse to fight our wars, they also refuse to finance them. But they will happily wave their Chinese-made flags.

[JohnWxy]

4. IRS estimates it loses about $100 Billion (yes, that's a 'B') a year to tax evaders.

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=114&topic_id=57686#57694


"The developments are part of a historic legal struggle that has cracked Switzerland's renowned reputation for banking secrecy and cast a spotlight on what a 2008 Senate hearing identified as $100 billion in annual tax evasion by American owners of foreign accounts."

[Jeep789]

6. Hopefully they will get hit hard this year

and the IRS will go over their taxes for the last seven years. Time for the freeloaders to start paying their share.

[Turbineguy]

3. Be that is it may

The number of millionaires probably fell by the same amount.

[JohnWxy]

5. IRS admitted the audit rate for wealthy tax-payers went down. IRS said the likihood of audit for

a high bracket taxpayer went down 19%. Note that this is a rate per number of taxpayers in that bracket. it is not a comparison of the number of audits of high bracket taxpayers in 2008 to the number of audits of high bracket taxpayers in 2007.

"In December, the IRS acknowledged that audits of wealthy taxpayers fell in 2008 but said the decline was much lower. In fiscal 2008, the IRS said, wealthy taxpayers had a 5.6% chance of being audited, down from 6.8% a year earlier. The IRS attributed the 19% decline to a drop in enforcement staff from the year before."