Audit Rates Rising for the Wealthy

The chances of IRS audit are going up for those who make more than $1 million annually. The IRS released data on Thursday which showed that 12 percent of upper income bracket tax payers were audited, compared to 8 percent in 2010 and 6 percent in 2009. For tax payers who earn less than $200,000, the percentage audited has remained steady around 1 percent.

USA Today quoted Deputy IRS Commissioner for Services and Enforcement Steven Miller, who said that the higher audit rates for higher earners were to “assure that those at the lower end of the spectrum know that those at the higher end of the spectrum are subject to the same rules and enforcement as everyone else.”

The IRS also said that the audit distribution across income levels was unrelated to President Obama’s pledge to raise taxes on the wealthy. IRS Spokeswoman Michelle Eldridge said, “We base our audit decisions on tax issues, nothing else. We don’t play politics here,” according to USA Today.

The IRS treated corporations similarly with the majority of companies audited having a greater amount of assets. In 2010 28 percent of corporations with assets greater than $250 million were audited compared to just 1 percent of companies with less than $10 million. The IRS has been increasing the number of audits performed each year overall. In 2001 just 0.6 percent of Americans were audited. In 2011 the agency audited 1.6 million returns, or 1.4 percent of tax payers. In 2010 8 out of 10 individuals audited had to pay additional taxes.