blogger visitor

Saturday, March 24, 2007

LEVEL OF IRS AUDIT AND ENFORCEMENT ACTIVITY

Once a year, the IRS issues information on its audit activities. The information is useful to determine what average audit risk is, and where the IRS is focusing its activities. Some highlights from the most recent information follows.

  • 0.97% of all individual returns that were filed were audited – double the number from 2000.
  • Of these, 40.3% related to earned income tax credit claims.
  • 76% of audits are done through the mail.
  • Individual returns with Schedule C (business) filings are audited at a much higher rate – 2% to 4% based on the amount of income reported.
  • Only 0.1% of trust and estate income tax returns are audited.
  • Almost 10% of estate tax returns are audited. 0.77% of gift tax returns are audited.
  • Only 0.38% of S corporation returns are audited.
  • 59,000 offers in compromise were received by IRS, and 25.4% were accepted. This number is less than in prior years.
  • The IRS commenced 3,907 criminal investigations in 2006. There were 2,720 referrals for prosecution and 2,019 convictions. Of those sentenced, 81.7% went to jail.

The IRS received 1.561 billion information returns.

No comments: