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>..withdrawn directives to auditors to crack down on aggressive tax shelters..

The above might be a salient point, but as for the 1/4 auditors lost and the rest:

The low income (under 25k) with EITC, were the largest audited group with 298,485 of 626,204 audits performed in 2022. The rest of those earning under 200k had 250,391 audits.[] 48% of audits were under 25k income w/ EITC. 87% of audits were people under 200k income.

Kind of interferes with the idea these audits were all about going after the "rich buddies." They were way more about going after the poor than they were about going after the rich.

[] IRS management audit reports obtained via FOIA by via TRAC / https://tracreports.org/reports/706/

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This has been debunked as these are just data matching audits as EITC is full of fraud with an estimated 30% of over claiming and improper payments by taxpayers.

Even if you change the view to it's mostly the poor who are the tax scammers it doesn't degrade the counterpoints that these auditors were by far mostly going after the middle class and poor -- you're just asserting the poors are *disproportionately tax cheats that perhaps deserve it.

*edit: since my words were take in bad faith

They wrote a program years ago to data match EITC, little to no extra manpower from the IRS is needed, that is the point.

I think you're strawmanning a bit. They're not saying poor people are tax cheats, just that tax cheats tend to be poor. This makes sense for the same reasons other types of crime are also associated with poverty. This is not to say that wealthy people do not also evade taxes, but they do so in ways that are harder to catch and prosecute. You're implying that going after poor people is some sort of classist discrimination but I think it's far more likely that there are good reasons for it.

Or just that there are more poor people. Say 10% of all people are tax cheats, evenly across income. The top 1% who are the rich is much smaller than the bottom 50% who are the poor. So in absolute numbers there will be far more poor tax cheats than wealthy. Even if 100% of the wealthy are tax cheats, that still ends up being fewer wealthy tax cheats than poor tax cheats. Anything involving absolute numbers of audits is going to be skewed to show more happening to the poor, because there are so many more poor people than rich people.

Last I checked it's way closer to 28% than 48% of people that have earned income of at least $1 (thus EITC) and total income less than $25k -- which fall under the bucket of 48% of audits were for those with EITC and income under 25k. They are definitely disproportionately going after the poorest workers.

am i missing something, or is the statistic that is used to pinpoint someone as poor, is the same statistic that is gamed here? Namely the amount of income that a person declares to the IRS?

And I would estimate 30% of people using tax shelters are underpaying their taxes. If there's profitable work to do for tax auditors, hire more auditors and cover both problems.

What percentage of that is automated audit, and what percentage is manual audit? Nowaday my country is mostly sane with tax filings, but in the weird time between the 90s and the 2010s, we had an uptick in "fraud" by low-income earners. This was caused by inconsistencies between filed data and the data the IRS equivalent had, but i guarantee you no effort was put into thsi (except secreterial manpower for the hotline/mail), that was just automated system ringing.

In fact my first college side-job was exactly that, responding to taxpayers who were "caught" by the automated system and needed a payment delay.

There are many, many more tax returns filed by people earning under 200k adjusted gross income than those earning more, I assume. So if there's a uniform chance that a return is audited, we would expect most audits to be done on returns under that threshold.

Of course, it may not make sense to select returns uniformly at random for audits...

Nowhere near 48% of the population earns enough wages for EITC but still under 25k. It's way way way way overrepresented in audits. Nearly half of the audits are aimed at the poorest workers.

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.... they were audits according to IRS. This is from the FOIA'd audit numbers from IRS via TRAC.

They are not audits. They are automated notices to idiots trying to claim the same child tax credit in multiple returns or hiding income(not reporting their w2 lol) to claim the EITC

In other words, understaffed agency goes for the low hanging fruit

Weird way to frame it. The computer does it automatically. They would do it whether they were well staffed or not.

The computer does not do all the loopholes and tax codes automatically. If it did that would solve a lot of these problems. But we need audits in the cases companies or people lie/exaggerate/forget/etc.

Also, if tax cheating is uniform across the population, then the statement "there are more tax cheats earning under 200k" is true but wildly misleading, since "there are more taxpayers earning under 200k" is also true.

Biden and democrats increased funding in order to have the resources to go after rich offenders and they were doing it successfully and earning more than it cost, but Trumpublicans immediately rescinded it. It’s all public record go look for it.

Yet they refused to codify the "promise" it wouldn't be used for under 400k income families. Look at what they do, not what they say. In public they make 'promises' but in statute it turns into ether, meanwhile real audit data pointing to otherwise.

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>I'm very confused about where you're going with this. Are you upset that too many rich people are getting audited, or that tax cheats under 400k income might also get audited?

... this was a direct response to parent stating increased funding was added specifically for going after rich people. Yes I would be upset if I was told they were adding new funding specifically to go after rich tax cheats but then turns out to be something like "welp actually we refuse to codify that or make anything binding that it will be used for those purposes, but for the cameras we will pinky swear it will be used for that and please don't look at the historical data for inferences."

I'm very confused about where you're going with this. Are you upset that too many rich people are getting audited, or that tax cheats under 400k income might also get audited?

Biden's desired policy was none of the additional funding would be used to increase audit rates for <$400k returns.

The IRS didn't follow the intended policy, getting bogged down in the details of how they would define that threshold (primarily, would somebody who understated their income to get below the threshold count as "under 400k and audited").

Not really sure why the OP is so upset - either way, the payback on additional funding to the IRS is almost universally stated as revenue-positive.

> Yet they refused to codify the "promise" it wouldn't be used for under 400k income families.

This is a lie. They didn't refuse. They didn't have it codified because they were trying to figure out how to define that. For example, one of the challenges IRS was having was someone reporting $390,000 but they actually earned $450,000. How do you deteremine that without an audit? Do you need a waiver? How does that get resolved without breaking the promise.

> Look at what they do, not what they say.

They were actively working on how to respect the promise in a reasonable way.

Yep. Here are some details, for anybody interested... https://www.govexec.com/oversight/2024/09/irs-behind-biden-p...

Not sure why you're being downvoted for this comment as it's true.

Democrats increased IRS funding so it could go after more tax evaders. Conservative estimates are that eliminating tax evasion (evasion, not avoidance) by the ultra-wealthy could allow the U.S. to reduce rate brackets by 2-3% across the board while maintaining revenue.

Kind of interferes with the idea these audits were all about going after the "rich buddies."

I think you misread the parent comment, who said exactly the opposite.

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