IRS Audits for the Most Wealthy

Many of us tend to believe that the wealthiest among us are made exempt from many of the rules that govern the rest of society. But in recent months the Internal Revenue Service has proven that this is not the case by increasing the number of tax audits of those who make over $10 million by 73 percent.

This staggering increase in the number of audits in the highest income bracket means that, last year, the IRS managed to audit over 18 percent of taxpayers that met this criteria.

While historically it has always been true that those in the lower income brackets have traditionally been under greater scrutiny than higher income earners, the tables have certainly turned in recent months.

Last year, taxpayers earning between $5 million and $10 million were also among one of the most highly audited groups. Of these individuals the IRS managed to audit nearly 12 percent, representing a 54 percent increase from the year before.

Why the Increased Scrutiny?

The increased scrutiny on higher earners comes as, in the current economic climate; the Internal Revenue Service makes a concerted effort to boost its revue. Additionally, the current audits accompany an IRS move to combat concerns from a majority of the population that it favors the wealthy

To a certain extent, the IRS has already been successful in its efforts to draw out additional income through audits on the wealthy. Last year alone funds from audits jumped 18 percent to approximately $57.6 billion

The IRS has even created a special unit, the Global High Wealth Industry Unit, to specifically monitor this influx of activity. However, since many audits take a number of years to resolve, the IRS will need to gauge their progress and potential for profit over time.