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The bold above is highly suspect. But that isn't the point in the first place. It is only via enforcement that the other 95% of people who are NOT audited - high earners or not - follow the law. If there is no enforcement, it would be a bit like the border with Mexico.
The IRS already audits low earners at at higher rate. It's not like those folks don't get audited.
That's trivial. It is called record keeping. At the time you prepare your return, you have your receipt/record (otherwise, you couldn't take that deduction in the first place). You keep a printout of return together with all supporting documents in a Banker's Box in a closet or your garage. On a rolling basis, you shred the return & supporting documents that are 7 years old.
Trivial.
It's an entire industry, it's hardly trivial. What % of millenials do you think balances a checkbook, let alone maintains records of ins/outs
You're taking the topic from enforcement - a matter of strategy, tactics & execution -- into the world of policy i.e., what ought to be taxed.
That is a quagmire, of course. I argue there is no reason to tax businesses in the first place. Just tax people to raise the required dollar amount of tax revenue. Businesses, being untaxed, wouldn't need armies of tax accountants & tax attorneys - they could focus on value-add. Business profits would increase, of course, and ultimately shows up in the balance sheets & income statements of business owners, customers, and employees -- all of whom are people. Just tax the people.
Congress wouldn't like that approach, of course, as tax treatment is one of their "products" that they sell in exchange for "campaign contributions." The LAST thing Congress would want is for campaign contributions to dry up.
I have said this for years. And I totally agree with you why it wouldn't happen.
I like paper. The thought of grinding through 80% of our return only to have a squirrel blow out our transformer would make my blood run cold filing electronically.
What? I've filed electronically for over 12 years and never has a squirrel caused a problem. You know how when you're writing a document in Word, the program saves your work? Yeah that's exactly how tax software works.
This is why more enforcement will mostly hit the middle class. The rich avoid taxes legally, with attorneys finding every loophole, so few are caught by audits. The small business owner getting away with things like bartering, personal use of Schedule C expenses, employees under the table, and unreported cash payments is probably the biggest return for the audit dollar. The same applies to the gig workers who may be making a lot more than they report. Once caught, these are people that can't afford the good attorneys to help them fight the IRS.
Businesses having under the table employees and unreported cash revenue will probably be raked over the coals.
The audit rate of those earning between $5 million - $10 million a year is currently only 1.4%. The audit rate of the top 1% of earners is 1.5%. Those numbers are DOWN by 80%. I have no problem with getting the audit rate back to where it used to be. The money recovered in those audits will more than cover the cost of the additional agents. The cost of the additional agents is $80 Billion. The amount of money owed to the IRS is about $307 Billion total, with the top 1% accounting for more than half at $163 Billion. Please explain why you don't want to spend $80 Billion to get $200 - $300 Billion back. Do you just think the government doesn't really need that $200 - $300 Billion?
Some in government do want the spend the money to get more than what they spent. Others don't want to anger the people it ensnares (sp?).
Drain the rich guy swamp. Poor little rich guys want to cheat and dont like getting thumped in side of head when they do. Want lower taxes and higher federal deficit, do it the right way, hand over your money to Moscow Mitch rather than IRS, LOL His answer to anything and everything is lower taxes on the rich. When they are zero he would support floating bonds so govt can send rich guys some of your tax dollars. Good boy Mitch, good boy, now roll over and play dead.
You really don't get it - audits are expensive and time consuming and random audits are done even if you did nothing wrong. It is not about a "rich guy" trying to cheat - it is about the pain and anxiety of the process just to prove you are right. Random audits are kind of like a fishing expedition by the IRS with the presumption of guilt even though no proof of wrongdoing. I am guessing you have never had to go through one.
You can't "lower the tax" on someone who pays zero tax and well over 50% (61% in 2020 and 57% in 2021) pay no tax. The reality is that the taxes are highly skewed toward the rich already in the US - the top 10% pay over 70% of all taxes and the top 20% pay 87% of all income taxes - in most first world countries, the middle class and poor pay much more in taxes than in the US, the burden is much more even across everyone, not just the few at the top.
Also, just to be clear, they are not "your tax dollars" - you did not earn them.
The audit rate of those earning between $5 million - $10 million a year is currently only 1.4%. The audit rate of the top 1% of earners is 1.5%. Those numbers are DOWN by 80%. I have no problem with getting the audit rate back to where it used to be. The money recovered in those audits will more than cover the cost of the additional agents. The cost of the additional agents is $80 Billion. The amount of money owed to the IRS is about $307 Billion total, with the top 1% accounting for more than half at $163 Billion. Please explain why you don't want to spend $80 Billion to get $200 - $300 Billion back. Do you just think the government doesn't really need that $200 - $300 Billion?
The amount owed is pure speculation - this is a fishing expedition in the hope of earning back what was spent - the government should look for ways to cut costs rather than spend more.
Your retro looking web page resource is misleading, they are including people who report $0 income as low wage earners who get audited, as part of <25k.
That $0 income group gets audited more often because it is usually people who just didn't file taxes, regardless of their income.
You really don't get it - audits are expensive and time consuming and random audits are done even if you did nothing wrong. It is not about a "rich guy" trying to cheat - it is about the pain and anxiety of the process just to prove you are right. Random audits are kind of like a fishing expedition by the IRS with the presumption of guilt even though no proof of wrongdoing. I am guessing you have never had to go through one.
You can't "lower the tax" on someone who pays zero tax and well over 50% (61% in 2020 and 57% in 2021) pay no tax. The reality is that the taxes are highly skewed toward the rich already in the US - the top 10% pay over 70% of all taxes and the top 20% pay 87% of all income taxes - in most first world countries, the middle class and poor pay much more in taxes than in the US, the burden is much more even across everyone, not just the few at the top.
Also, just to be clear, they are not "your tax dollars" - you did not earn them.
That’s false. I’d bet you most or nearly all of the people you are limping into that category paid/pay taxes every year. Make sure you are phrasing properly because when most get on the 50% no taxes roll they are talking about federal, not fica, not state/local, not sales tax etc
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