The IRS recently released its statistics reporting on audits of taxpayers by category and by type of audit. Syracuse University's Transactional Records Access Clearinghouse released its analysis of that data on Tuesday, here. I am reporting this here because of the obvious interest in these statistics, but readers should note, as indicated at the TRAC site, that the IRS has informed TRAC that the statistics contain errors, and therefore this analysis from TRAC is subject to correction once the researchers are informed about the nature of the errors.
The following graphic from the TRAC report ably demonstrates (double click to see larger image)
the difference in use of audits for lower and higher income taxpayers. Those with less than $25,000 in annual income are subject to significantly higher audit rates compared to those with $200,000 or more in annual income. When it comes to face-to-face audits--the kind most likely to turn up evasive tax avoidance schemes--the wealthy are particularly favored by lower audit rates. Only 30 of the 180,000 or more millionaires were subject to face-to-face audits in fiscal year 2005. Id.
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