IRS audit crackdown: Who’s most likely to be targeted

The IRS plans to more than double its audit rate for its wealthiest taxpayers.

Transcript:

CONWAY GITTENS: I’m Conway Gittens reporting from the New York Stock Exchange. Here’s what we’re watching on TheStreet today.

Wall Street is reacting to the April jobs report – the U.S. economy added 175,00 jobs in April, below expectations of 240,00, and a notable slowdown from a gain of 303,000 in March. The unemployment rate also rose to 3.9 percent from 3.8 percent. This report could be a sign that the Federal Reserve’s 11 rate hikes have finally started to dampen labor demand.

Separately, Apple shares saw a major pop in early morning trading after the tech giant announced a 110 million dollar share buyback, marking the largest share buyback in U.S. history

In other news - The Internal Revenue Service plans to more than double its audit rate of the country’s wealthiest taxpayers by 2026. The agency says the audits will pertain to taxpayers with a positive income of more than $10 million. It also intends to nearly triple the audit rate on corporations with more than $250 million in assets.

Of the new plan, IRS Commissioner Danny Werfel said “This update also reflects our ongoing effort to make sure we focus compliance resources where they need to be.” However, the Commissioner made sure to point out that the IRS will not increase audit rates for small businesses and taxpayers making under $400,000.

Between 2013 and 2021, the IRS examined less than one percent of tax returns, both individual and corporate. And according to its most recent Data Book, the IRS closed more than 580,000 tax return audits last year. That led to $31.9 billion in recommended additional taxes owed.

That’ll do it for your daily briefing. From the New York Stock Exchange, I’m Conway Gittens with TheStreet.

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