TIGTA Asks IRS to Reconsider Who is High-Income
tax returns potentially present the least productivity of all high-income taxpayers," and, by contrast, "the number of audits conducted by the IRS greatly declines when the income range reaches the $400,000 TPI level. Further, the IRS audits far fewer taxpayers with incomes of $600,000 or more even though they appear to be the most productive audits."
With this in mind, TIGRA suggested that the IRS might make better use of the resources at its disposal to audit high-income individuals if it raised the threshold for who exactly counts as high-income in the first place. The IRS, in response however, felt there wasn't sufficient reason to increase the threshold, as "IRS management told us that decisions on resource allocation cannot be made solely on the basis of productivity measures alone (e.g., Recommended Dollars per Hour)."
However, TIGTA said that in the face of diminishing IRS budgets, "it is critical for the IRS to determine the best use of its limited resources" and continued to call for the service to "reevaluate the appropriate income thresholds for its High-Income and High-Wealth strategy and reassess its case selection methodology to determine if more emphasis should be given to auditing taxpayers with higher TPIs to address the higher potential productivity shown for those TPI levels."
With this in mind, TIGRA suggested that the IRS might make better use of the resources at its disposal to audit high-income individuals if it raised the threshold for who exactly counts as high-income in the first place. The IRS, in response however, felt there wasn't sufficient reason to increase the threshold, as "IRS management told us that decisions on resource allocation cannot be made solely on the basis of productivity measures alone (e.g., Recommended Dollars per Hour)."
However, TIGTA said that in the face of diminishing IRS budgets, "it is critical for the IRS to determine the best use of its limited resources" and continued to call for the service to "reevaluate the appropriate income thresholds for its High-Income and High-Wealth strategy and reassess its case selection methodology to determine if more emphasis should be given to auditing taxpayers with higher TPIs to address the higher potential productivity shown for those TPI levels."