The IRS has announced plans to significantly increase audit rates on wealthy Americans and large corporations as part of a broader effort to crack down on tax evasion. Key points include:

IRS aims to increase audit rates for taxpayers earning over $10 million by more than 50%, bringing the audit rate to 16.5% in 2026.
Audit rates for large corporations with assets over $250 million are set to triple, as well as audit rates for business partnerships with assets over $10 million increasing tenfold.
Funding for these enforcement efforts was included in the Inflation Reduction Act, signed into law by President Biden in 2022. The influx of money is intended to improve tax compliance among big corporations and wealthy Americans and reduce the estimated $600 billion tax gap.

The IRS has allocated $9.3 billion for fiscal 2025, $7.3 billion for fiscal 2026, and a total of $57.82 billion over the decade through fiscal 2031 towards these enforcement efforts. Despite the increased focus on audits for high-income individuals and corporations, the agency has clarified that audit rates for small businesses and taxpayers making under $400,000 will remain at historically low levels.

You can read this full article at: https://papersourceonline.com/irs-plans-to-more-than-double-its-audit-rate-of-wealthy-taxpayers/(subscription required)

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