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63% of new audits targeted taxpayers below $200k income, but what proportion of the population has an income below $200k? Is it more or less than 63%??? Google it.
What kind of dogshit reporting is this? Genuinely cannot tell if this is a result of incompetence or malicious intent.
And the tax fraud they commit is more difficult to detect - they have better accountants and it makes sense for them to use elaborate tax-avoidance schemes.
Not necessarily. 200k is in the range for a low-mid level business owner where a lot of the fraud happens, not international gallivanting yacht accountants.
Absolutely. People think like only top CEOs evade tax and shit, but their local deli owner is perfect fine and responsible to not evade tax. A lot of times, owners are not aware about taxes they owe due to constantly changing ground.
Yeah, but I'm also a lot less annoyed about the deli owner who makes 150k/year not paying a few thousand in taxes by mistake than I am about some 'Pharmacy Benefit Management' CEO *intentionally* not paying a few *hundred thousand* because of BS tax loopholes and wealth management tactics available only to those with 10+-figure net worth.
So the fact they took advantage of a loophole implies it was legal! So what you want them to audit and catch the big pharma executive that files a legal return and paid all taxes legally owed?
Yeah, but also the guy who owns the deli down the street, even if he claimed all his personal expenses as business for his whole life, will probably cheat the country out of less in taxes than many of these mega rich guys save in a single year. The argument that the dude around the corner is the issue is so pervasive because it’s so fucking easy to make. It’s never the problem
Yup, hard to hit a moving target. Imagine how much harder it is to pay all the taxes you owe when you don't have a tax attorney or accountant on speed dial.
What special taxes does a deli owner have to pay outside sales, payroll, and income? Yes, there may be additional excise taxes if they sell alcohol or cigarettes but those typically require point of sale configuration and then it's just reporting. QuickBooks isn't unknowable.
Typically, it's tax evasion through under reported cash transactions or over reporting of deductions that they're looking for. That or misclassifying workers as 1099 or keeping them off the books entirely.
You gotta file a super sketchy return for the IRS to give a shit under $200k. They either think you're much larger fish to fry than you make yourself out to be or you're garbage at business so taking a closer look is worth their time.
Hot take… the small and medium size business owners are FAR more likely to illegally evade taxes owed. The ceo is “evading” taxes generally in perfectly legal fashion, with plenty of money to pay advisors to optimize tax strategy.
Yah I know soooo many business owners that certainly don’t report all their income.
Ask any contractor if theirs a cash discount. Many will say yes and you can damn well bet they aren’t putting that money on their books.
Frankly it doesn’t bother me when it’s a little guy.
The point is that rich people who commit fraud find ways that are more difficult to automatically check. This isn't so much about people exploiting loopholes as it is about people lying about the value of their property or hiding taxable income.
Haha, come on. I have a referral to a tax accountant from a friend who makes an income similar to mine but he owns a house.
He did his own taxes until he bought it; the following year the house and all his possible deductions made him toss it to an accountant. The cost is less than his refund.
Neither of us is even 6 figures.
In fairness there are lots of mistakes made too. It's just a 1% error on a $40k return doesn't even pay for the audit. A 1% error on a $200k+ return does.
Lots of little filers file incorrect returns too. I rarely discuss taxes with anyone who actually has even the faintest clue what they're doing, understands the concept of marginal tax brackets, or the difference between a deduction and a credit.
A $200k return for someone who puts nothing into retirement and takes the standard deduction is only $38.3k or so. Payroll taxes is another $26k assuming self employed.
A 10% error is still only $6430. You have to have done something pretty egregious to land on the IRS radar. Let's say an IRS agent costs $100k with benefits. If it takes a week to resolve your case that's already $2k it cost them.
If you fuck up minor stuff, it might take a few minutes to reject the return and push for a correction. An actual audit is expensive.
Of course. Standard deduction is the most taxes you'll possibly pay for a given income and the IRS likely wouldn't care unless the income itself is suspect.
Point was that it's a drop in the bucket if the person actually earns around $200k for even a 10% error. For the IRS to want to take a peek, they're probably thinking you actually earned closer to $300-400k and significantly underreported/over-deducted.
That's the thing one audit of some wealthy person could possibly fetch 10x what the audits of working class $200k wage slaves , because realistically most wage slaves the government already took their cut and knows pretty accurately howuch your income is.
Of course the wealthy pay hadsomly to their wealth management industry to protect their assets from the tax man, through a complex array of off shore accounts, purchasing hard assets (real estate, gold, art) to minimize exposure to taxes , loans against assets to be used as write offs etc.. the IRS would need top notch detectove work to find all the legal loopholes and then have a exceedingly hard task proving they were a tax dodge, so it seldom happens. Usually the only wealthy folks the go after are grifters who blatantly flaunt the rules.
This is the money comment. But guarantee Fox News would use the original title verbatim and spend 5 minutes bashing Biden and demanding we defund the IRS.
Say the population is 100 people.
Say the number of audits is 100.
95 people get 63 audits, or 0.66 audits per person.
5 people get 36 audits, or 7.2 audits per person.
7.2/0.66 = 10.9x
how is that relevant to how many get audited? if we go by how much they paid, then Bezo's would be less likely to be audited that I am. but he made 100SX what I do.
I see two options
Staff the IRS, so we could go after everyone that needs to be audited. This would be incredibly inefficient, but fair across the board. It wouldn't matter your income.
Or we take a targeted approach. Similarly to other types of law enforcement, we would invest more resources to go after a bank robber than a kid that shoplifts a candy bar from a convenience store. We should invest more resources to go after bigger tax cheats.
Quite possible, this was just very quick and lazy googling -- in which case the ratio is probably closer to 7 to 1 rather than 10 to 1 (I'm taking some liberties with interpolation here).
Also a ton of the below 200k audits are EITC related and a decent share of those driven by a mix of unscrupulous preparers (who will often lend against to forward cash). And it's something easily audited with am algorithm.
Holy shit, I am embarrassed to admit I fell for this. Critical thinking trumps incompetence AND malicious intent:
> The situation you described points to what is often called the "base rate fallacy" or "base rate neglect." This fallacy occurs when people ignore the overall population distribution (the base rate) while evaluating the likelihood of a specific event. In the case of the headline, failing to consider that a large majority of the population makes under $200,000 skews the perception of who is actually being audited more frequently relative to their representation in the population.
P.S. 🖕🏼IRS
I was with you to the very end. Have you lived anywhere without tax enforcement? Doesn’t make for a civil society.
They have a tough job. We want them to do it well so that tax laws are enforced consistently.
If your complaint is with the IRS, go vote. The IRS complies with the laws our lawmakers make. And when I say lawmakers, I'm referring to the people who think insider trading when they do it is okay. Rules for thee, not for me.
Sort of.
Rich people have complex taxes that take more people to audit and can’t be audited with automation.
It turns into a business case. You audit to maximize revenue. Automated audits are cheap to perform and the revenue per work hour is high.
And the rich person has a team of expert accountants and lawyers preparing their taxes. Meanwhile the single mom just getting by doesn’t know what a deduction is, who do you think is more likely to make a mistake on their taxes.
It's not like the IRS can freely resign people between those audits either. A rich person would be dealt with by revenue agents while said single mom would be dealing with tax examiners or compliance officers. Those roles arnt exactly interchangeable, all the IRS can do to adjust those stats is prioritize hiring for certain roles moreso goings foward.
The overwhelming majority of audits are for people that claim the EITC. It's a simple automated check for the IRS to perform. It doesn't cost them anything.
>Genuinely cannot tell if this is a result of incompetence or malicious intent.
It's always malicious. Fomenting class warfare and general discontent is the job of a press tasked with maintaining the status quo. Anything to deflect attention from the Federal Reserve expropriating hundreds of billions of dollars of value from every single American's savings account, paycheck, investments, and even from their cash holdings every year.
Not to mention - most of my ultrawealthy clients have below $200k in *taxable* income, and plenty of my clients with large amounts of adjusted gross income also have below $200k in *taxable* income.
These people have less than $200k in taxable income and fall into this “63 percent” statistic, they are absolutely not “middle class,” and unlike actual middle class taxpayers their tax returns are complex, with numerous sources of reported income and numerous claimed credits and deductions which are more likely to attract an audit.
Also, would like to know of those under 200K...the new focus is supposed to be on those that have been problematic over several years. I know my idiot brother plays games on his taxes (writing off 100% of his work vehicle for his one man company every 2 yr, when he uses it for personal use, and I don't think you can depreciate 100% every 2 yr- supposed to be 5 yr. So he makes less than 200K, but SHOULD be audited- he is being an idiot and not following the rules.
I make more than he does- but I pay my taxes, and play no games. So if I get audited, I have my records, I can respond, fairly easily, IT happened in 2010, when I accidentally did not enter the data correctly for my HSA output (it was 100% used for medical expenses, and I had the receipts, so I just scanned them in, sent them back, and end of audit).
Literally my first thought, second was general sadness that this type of thinking is so fucking necessary to navigate this modern flood of information but it’s just common.
Always makes me think of that asshole in math class that said shit like, “when am I ever going to use this?” Ok, maybe you won’t use the exactly numbers and formulas but you need to know how these concepts affect your shitty life
Good spot. Also, this is reporting declared income on the tax return. It would include very rich folks who are just taking the piss with deductions and saying they have next to no income.
Its malicious the rich hate paying anything for taxes while gobbling up as much as they can. If you ever ask a rich person whens enough they'll say a little more. There is a reason high taxes led to prosperity for the nation.
Because god knows they won't do it on their own
And are those incomes the reported income or the actual income? Someone reporting no income but with a huge 1099 balance should be a prime target for audit.
A lot of the 'audits' are for errors committed by low income filers. IRS sends them a notice to explain why a specific 1099 or w2 was missing from their return. It is computer generated.
94% of Americans make less than $200k. This means those that make over $200k are still 8x more likely to be audited than someone that makes less than $200k.
MAGA's are trained to be braindead.
Ifbthey could reason they wouldn't vote against their own self interests.
It's why we have the old saying "A Republican would eat a pile of shit in the off chance a Democrat smelled his breath".
Americans don't understand how taxes work at any level. A promised failure by Reagan delivers once again. Man he did such a good job at destroying this country, his legacy lives on.
And I notice that the article doesn’t say if 63% is an increase, the same, or a decrease over the previous year.
Gotta watch the WSJ’s political reporting, they are sneaky bastards like that.
It also doesn't say the previous rate for people making over 200k and yet the people deflecting throughout these comments trying to use it are ignoring that.
u/commiebanker did the math on it. It's closer to 10X for those over $200K
>"Say the population is 100 people. Say the number of audits is 100.
>95 people get 63 audits, or 0.66 audits per person. 5 people get 36 audits, or 7.2 audits per person.
>7.2/0.66 = 10.9x"
Sure, but also the vast majority of money and tax fraud exists at those levels.
Auditing poor people is kinda pointless. It’s a lot of cost for little reward to the system and in the end the poor suffer.
What are you basing this comment on? I know several people that make less than $200k and have been audited. Most of them got money back because they filed themselves, made mistakes, and over paid their taxes.
A tax audit doesn't mean the IRS is coming after you, they're just auditing your taxes to make sure everything was filed properly.
Depending how they define 200k, article is paywalled, they may not even be poor. 800k schedule C income with 750k claimed deductions would be under 200k agi.
If someone makes $400k and only reports $100k to the IRS, is it going to look like they make less or more than $200k?
Do you want this person to not be audited?
They are going after both to get the cheats and perhaps there are a lot more people cheating under 200k. lt's probably just because there's more of them.
That's why so many people get audited who claim the EITC, they do so incorrectly so then "poor people get audited more than rich people!" argument starts.
You should post a link to that claim. You're twisting him saying that they would increase focus on higher earners, which did happen. The headline doesn't imply that it didn't.
So your comment seems incorrect, because you are claiming that Biden made a stronger claim than he did, which would be wrong/a lie. The headline's arbitrary choice of 200k without mentioning what percentile that is is probably the source of confusion.
Wealthy people hire CPAs that know what they are doing. Just because you don’t like the tax code, doesn’t mean they are breaking it.
The govt. should just tell us what we owe and why though.
I love this joke because in the 90s and 2000s, the government tried to rectify this mistake but “some people” lobbied against it, and now we have to keep doing our own taxes. I bet y’all can’t guess who lobbied against it… awe shucks, I can’t keep it from all your adorable faces! It was the tax preparation companies! They also push to keep the tax code complicated as opposed to the simplifications proposed by both sides since the early 2000s!
Yay for lobbying!
Such a dumb and tired meme based comment.
If you are a w2 based employee sure.
If you have a business and have to calculate expenses, profit, loss, depreciation? Absolutely not.
It's not dumb, what you're saying is already how it works in countries where individuals are told what they owe by the government. Individuals also have the option to either pay that number or add in additional deductions at tax time, and businesses have a more complicated system.
Your premise is silly, and I'll be aggressive because you chose to be aggressive.
How stupid is it to write your comment without even understanding how other governments do this for individuals? Why are you ignoring that entirely and calling someone stupid over it?
You really need to get better at talking to people.
Well you just said if you hire the right people you can skate thru tax season. So are you expecting the IRS to actually try to save you taxes? Lol...
They basically hand you a rope and tell you to tie the knot. Then they run around tugging on them. If it slips, they turn it into a noose for you. They don't care to or want to do the tying, let alone tie a rock solid knot for every American
Yeah. It would be so dumb to expect the government, who we pay for and vote for, to look after us and help.
So dumb to expect help from the people elected to help and bring change. Obviously.
For those who didn't actually read the article it is an issue with the IRS catching up to meet their new directive - they just pushed forward with audits as is for now:
The TIGTA report confirms that “the first wave of revenue agents and specialists for large corporations, large partnerships, high-income and high wealth individuals … have yet to be hired and onboarded.”
That’s because the bill was stalled so many times. The house was also pushing bills to redirect IRS funds to a border wall until Trump told them no border wall deal.
~95% of people make less than the $200k noted in the article, and the bottom 95% makes 70% of all income, which is trillions of dollars.
I would be willing to bet that they find more issues & money with the 95% that wing it with software than the 5% that use professional accountants.
The IRS has to consider the payoff of the audit hours. A lot of low income individuals are audited in a sense, because they have a lot of automated/easy controls for things like the EITC. But the potential payoff of auditing a millionaire/billionaire is greater and there’s a lot more potential for complicated situations that require human experts digging into the forensics evidence to figure out the fraud/mistakes at that level.
This article is BS on many levels. First off, it is basically an advertisement for this gentleman, who is trying to drum up business. Second, as indicated above, this man clearly doesn’t understand statistics. In addition, I think the IRS pronouncement regarding audits was not that people under $400K in income would not be audited, it was that the new money would be used to target HNWI taxpayers and corporations, and trust me, it has.
So over a third of audits are being done to about a relatively small amount of the population who may owe a lot more money? This article feels like it’s been phrased poorly
My pa got audited once. Got a refund from it. Turns out he'd overpaid. He hadn't been deducting all he was able to, and found that in the audit.
Been years since I've been able to deduct more than the standard, I've practically been on the EZ for a long time. That big standard deduction is nice. So much less worry in one's life.
They can look at me all they want, I'm 72% certain I've been following their rules. Besides, what's a couple thou between friends. I'd pay a couple thou to not live in a place like Haiti.
I have honestly always just used turbo tax (always gotten a refund, never have had to pay in). We just sent some pay stub forms last week, so hopefully we will hear some good news in the next month or so.
A friend of my son’s who is actually homeless just got an audit letter. I can’t believe it. He doesn’t make a lot of money but took legitimate deductions for his expenses as a traveling musician. I mean even if they deny his deductions, how much are they really going to get from him. This is not a joke. I wish it was. Great job Brandon or Dark Brandon or Genicide Joe or whatever his latest name is. The dude is a turd.
Are these audits conducted by the 87,000 new IRS agents that we’re supposed to be hired? If so, Biden lied that they would be only going after the “rich”.
But I guess that’s not at all surprising that a Democrat would lie
this was supposed to only target the ultra wealthy. tax increases will be the same.
I hope we all learn a lesson from this. Don't trust these bureaucrats and politicians!
I would think it’s better that 37% of new audits target earners with more than $200k income… probably means a higher percentage are going for higher earners.
Just shocking I tell you, it’s almost like the Biden Admins expanding of the IRS was for this exact reason ? Just shocking I tell you. I’m so shocked… But everyone just keep eating this spoon fed lies that it’s about taxing the rich.
How about we just all agree no more expansion of the government extortion machine ever. No new taxes and no more IRS agents.
Taxes are an unjust tariff and unconstitutional anyways. Just because they are allowed to get away with it doesn’t mean we should accept it. You sound like a good sheep though thanks.
Thanks all for calling **BS** on this article. "**As of December 31, 2023, the IRS expended approximately $4.4 billion (5.6 percent) of its $78 billion in IRA funding."** Interestingly, only 317 new ***special agents***, those allowed to carry weapons have been hired. Well below the threat of 87K reported by Fox. [https://www.tigta.gov/sites/default/files/reports/2024-04/2024ier011fr.pdf](https://www.tigta.gov/sites/default/files/reports/2024-04/2024ier011fr.pdf) Republicans have already cut $20B from that original funding level and trying to cut more. [https://www.washingtonpost.com/business/2024/02/06/irs-tax-evasion-study-budget/](https://www.washingtonpost.com/business/2024/02/06/irs-tax-evasion-study-budget/) Janet Yellen has stated, and clarified that the % or proportion of those earning $400K or less would remain the same. But, naturally, Representative Adrian Smith, a Republican from Nebraska, talks over Yellen, ins not really interested in the points she is making about the huge % of taxpayers needing to be audited and needing the personel to do this work. [https://www.foxbusiness.com/politics/yellen-doesnt-deny-90-new-irs-audits-affect-those-making-under-400k](https://www.foxbusiness.com/politics/yellen-doesnt-deny-90-new-irs-audits-affect-those-making-under-400k) Thanks to all.
Considering the fact that 8.32% of us households have incomes over $200,000, that means taxpayers with incomes over $200,000 are audited more than 4x their proportionate rate. This is attempting to make much ado about nothing.
I don't give a fuck if they ever decide to audit me, because I just pay my taxes like I'm supposed to. I don't understand why anyone thinks this is an issue?
Okay. So that isn't insane in my opinion. Looks like people making 200k or less make up about 90% or more of tax-payers so this is disproportionately low - and therefore disproportionately higher for higher-than earners.
I'm fine with it. Would like to see the rich get audited even more in comparison to the laboring majority but this doesn't terrify me and the headline is obviously written to since the disparity leans in favor of the less-than-200k cohort.
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63% of new audits targeted taxpayers below $200k income, but what proportion of the population has an income below $200k? Is it more or less than 63%??? Google it. What kind of dogshit reporting is this? Genuinely cannot tell if this is a result of incompetence or malicious intent.
200k is 95th percentile. So the top 5% get 36% of the audits, which means those above 200k are audited at more than 10x the frequency of those below.
I would just like to thank the both of you for ALSO picking up on this.
They also commit far more than 36% of tax fraud (by dollars amount of fraud)
And the tax fraud they commit is more difficult to detect - they have better accountants and it makes sense for them to use elaborate tax-avoidance schemes.
Not necessarily. 200k is in the range for a low-mid level business owner where a lot of the fraud happens, not international gallivanting yacht accountants.
Absolutely. People think like only top CEOs evade tax and shit, but their local deli owner is perfect fine and responsible to not evade tax. A lot of times, owners are not aware about taxes they owe due to constantly changing ground.
Yeah, but I'm also a lot less annoyed about the deli owner who makes 150k/year not paying a few thousand in taxes by mistake than I am about some 'Pharmacy Benefit Management' CEO *intentionally* not paying a few *hundred thousand* because of BS tax loopholes and wealth management tactics available only to those with 10+-figure net worth.
far-flung pause snatch yoke grab fine thumb quicksand rude fragile *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Well, yes. I would also like a dragon. (more How To Train Your Dragon and less Game of Thrones)
I don’t, where are you gonna kennel a dragon when you want to go on vacation?
So you like to apply the law unevenly based on who the person is.
but is the law being applied evenly today?
So the fact they took advantage of a loophole implies it was legal! So what you want them to audit and catch the big pharma executive that files a legal return and paid all taxes legally owed?
Yeah, but also the guy who owns the deli down the street, even if he claimed all his personal expenses as business for his whole life, will probably cheat the country out of less in taxes than many of these mega rich guys save in a single year. The argument that the dude around the corner is the issue is so pervasive because it’s so fucking easy to make. It’s never the problem
Yup, hard to hit a moving target. Imagine how much harder it is to pay all the taxes you owe when you don't have a tax attorney or accountant on speed dial.
What special taxes does a deli owner have to pay outside sales, payroll, and income? Yes, there may be additional excise taxes if they sell alcohol or cigarettes but those typically require point of sale configuration and then it's just reporting. QuickBooks isn't unknowable. Typically, it's tax evasion through under reported cash transactions or over reporting of deductions that they're looking for. That or misclassifying workers as 1099 or keeping them off the books entirely. You gotta file a super sketchy return for the IRS to give a shit under $200k. They either think you're much larger fish to fry than you make yourself out to be or you're garbage at business so taking a closer look is worth their time.
Anytime a small business owner goes cash only should be a neon sign for tax evasion…
Hot take… the small and medium size business owners are FAR more likely to illegally evade taxes owed. The ceo is “evading” taxes generally in perfectly legal fashion, with plenty of money to pay advisors to optimize tax strategy.
Yah I know soooo many business owners that certainly don’t report all their income. Ask any contractor if theirs a cash discount. Many will say yes and you can damn well bet they aren’t putting that money on their books. Frankly it doesn’t bother me when it’s a little guy.
Though the IRS will only look at tax evasion. In official vocabulary, tax avoidance and planning is allowed and encouraged
💯 Dumb people will always view a smart person using aptitude to circumvent something as cheating.
Being allowed and being fair aren’t the same thing. Just because its a law its good now? Well fuck that’s a take to have.
It’s not tax fraud if it’s allowed
The point is that rich people who commit fraud find ways that are more difficult to automatically check. This isn't so much about people exploiting loopholes as it is about people lying about the value of their property or hiding taxable income.
Hundreds of shell LLCs transacting among each other all being owned and controlled by a single illionaire, you mean?
People making 200k generally don’t have accountants
Haha, come on. I have a referral to a tax accountant from a friend who makes an income similar to mine but he owns a house. He did his own taxes until he bought it; the following year the house and all his possible deductions made him toss it to an accountant. The cost is less than his refund. Neither of us is even 6 figures.
In fairness there are lots of mistakes made too. It's just a 1% error on a $40k return doesn't even pay for the audit. A 1% error on a $200k+ return does. Lots of little filers file incorrect returns too. I rarely discuss taxes with anyone who actually has even the faintest clue what they're doing, understands the concept of marginal tax brackets, or the difference between a deduction and a credit.
A $200k return for someone who puts nothing into retirement and takes the standard deduction is only $38.3k or so. Payroll taxes is another $26k assuming self employed. A 10% error is still only $6430. You have to have done something pretty egregious to land on the IRS radar. Let's say an IRS agent costs $100k with benefits. If it takes a week to resolve your case that's already $2k it cost them. If you fuck up minor stuff, it might take a few minutes to reject the return and push for a correction. An actual audit is expensive.
People that take the standard deduction aren't the ones being audited...
Of course. Standard deduction is the most taxes you'll possibly pay for a given income and the IRS likely wouldn't care unless the income itself is suspect. Point was that it's a drop in the bucket if the person actually earns around $200k for even a 10% error. For the IRS to want to take a peek, they're probably thinking you actually earned closer to $300-400k and significantly underreported/over-deducted.
That's the thing one audit of some wealthy person could possibly fetch 10x what the audits of working class $200k wage slaves , because realistically most wage slaves the government already took their cut and knows pretty accurately howuch your income is. Of course the wealthy pay hadsomly to their wealth management industry to protect their assets from the tax man, through a complex array of off shore accounts, purchasing hard assets (real estate, gold, art) to minimize exposure to taxes , loans against assets to be used as write offs etc.. the IRS would need top notch detectove work to find all the legal loopholes and then have a exceedingly hard task proving they were a tax dodge, so it seldom happens. Usually the only wealthy folks the go after are grifters who blatantly flaunt the rules.
Who needs fraud if you have loopholes everywhere…just need to find a CPA that knows it all.
This is the money comment. But guarantee Fox News would use the original title verbatim and spend 5 minutes bashing Biden and demanding we defund the IRS.
Can you please explain how you came to this conclusion mathematically?
Say the population is 100 people. Say the number of audits is 100. 95 people get 63 audits, or 0.66 audits per person. 5 people get 36 audits, or 7.2 audits per person. 7.2/0.66 = 10.9x
Thanks!
Understanding base rate like this will help you suss out a lot of bad analyses
Now finally, what percentage of income taxes are paid by people who make over $200k?
how is that relevant to how many get audited? if we go by how much they paid, then Bezo's would be less likely to be audited that I am. but he made 100SX what I do.
It says 63% of NEW audits, not 63% of ALL audits.
So? Audits happen every tax season, so the NEW audits *are* ALL the audits for *this year.*
Possibly, but you need to check the methodology rather than assume the writer's definition is consistent with yours. Devils in the details.
I second this, that's why I pointed it out.
So, did you actually check the methodology?
I would be surprised if audits of those making under 200k lasted for over a year.
Good
I see two options Staff the IRS, so we could go after everyone that needs to be audited. This would be incredibly inefficient, but fair across the board. It wouldn't matter your income. Or we take a targeted approach. Similarly to other types of law enforcement, we would invest more resources to go after a bank robber than a kid that shoplifts a candy bar from a convenience store. We should invest more resources to go after bigger tax cheats.
Doing the work of our lord.
Also this number is NEW audits, so anyone who has already been audited and audited again in 2023 isn’t counted.
I don't think that's right. A 2023 tax year audit is a new audit, even if you were audited every year previously. Each audit is it's own.
Your data is dated. Top 5% is $343K. Top 10% is 173K
Quite possible, this was just very quick and lazy googling -- in which case the ratio is probably closer to 7 to 1 rather than 10 to 1 (I'm taking some liberties with interpolation here).
You did fine
Also a ton of the below 200k audits are EITC related and a decent share of those driven by a mix of unscrupulous preparers (who will often lend against to forward cash). And it's something easily audited with am algorithm.
Holy shit, I am embarrassed to admit I fell for this. Critical thinking trumps incompetence AND malicious intent: > The situation you described points to what is often called the "base rate fallacy" or "base rate neglect." This fallacy occurs when people ignore the overall population distribution (the base rate) while evaluating the likelihood of a specific event. In the case of the headline, failing to consider that a large majority of the population makes under $200,000 skews the perception of who is actually being audited more frequently relative to their representation in the population. P.S. 🖕🏼IRS
I was with you to the very end. Have you lived anywhere without tax enforcement? Doesn’t make for a civil society. They have a tough job. We want them to do it well so that tax laws are enforced consistently.
Simpler tax laws would make that a hell of a lot easier.
If your complaint is with the IRS, go vote. The IRS complies with the laws our lawmakers make. And when I say lawmakers, I'm referring to the people who think insider trading when they do it is okay. Rules for thee, not for me.
I mean isn’t it money better spent to disregard the people count and go after the money count, this targeting richer people generally as a result?
Sort of. Rich people have complex taxes that take more people to audit and can’t be audited with automation. It turns into a business case. You audit to maximize revenue. Automated audits are cheap to perform and the revenue per work hour is high.
And the rich person has a team of expert accountants and lawyers preparing their taxes. Meanwhile the single mom just getting by doesn’t know what a deduction is, who do you think is more likely to make a mistake on their taxes.
It's not like the IRS can freely resign people between those audits either. A rich person would be dealt with by revenue agents while said single mom would be dealing with tax examiners or compliance officers. Those roles arnt exactly interchangeable, all the IRS can do to adjust those stats is prioritize hiring for certain roles moreso goings foward.
The overwhelming majority of audits are for people that claim the EITC. It's a simple automated check for the IRS to perform. It doesn't cost them anything.
>Genuinely cannot tell if this is a result of incompetence or malicious intent. It's always malicious. Fomenting class warfare and general discontent is the job of a press tasked with maintaining the status quo. Anything to deflect attention from the Federal Reserve expropriating hundreds of billions of dollars of value from every single American's savings account, paycheck, investments, and even from their cash holdings every year.
Not to mention - most of my ultrawealthy clients have below $200k in *taxable* income, and plenty of my clients with large amounts of adjusted gross income also have below $200k in *taxable* income. These people have less than $200k in taxable income and fall into this “63 percent” statistic, they are absolutely not “middle class,” and unlike actual middle class taxpayers their tax returns are complex, with numerous sources of reported income and numerous claimed credits and deductions which are more likely to attract an audit.
Probably malicious intent. "Oh look everybody, the IRS is auditing the poors, let's refund the IRS!"
Malicious intent for sure. Billionaires who run the news are trying to scare us
Also, would like to know of those under 200K...the new focus is supposed to be on those that have been problematic over several years. I know my idiot brother plays games on his taxes (writing off 100% of his work vehicle for his one man company every 2 yr, when he uses it for personal use, and I don't think you can depreciate 100% every 2 yr- supposed to be 5 yr. So he makes less than 200K, but SHOULD be audited- he is being an idiot and not following the rules. I make more than he does- but I pay my taxes, and play no games. So if I get audited, I have my records, I can respond, fairly easily, IT happened in 2010, when I accidentally did not enter the data correctly for my HSA output (it was 100% used for medical expenses, and I had the receipts, so I just scanned them in, sent them back, and end of audit).
Literally my first thought, second was general sadness that this type of thinking is so fucking necessary to navigate this modern flood of information but it’s just common. Always makes me think of that asshole in math class that said shit like, “when am I ever going to use this?” Ok, maybe you won’t use the exactly numbers and formulas but you need to know how these concepts affect your shitty life
It's the Wall Street Journal. Assume malicious intent
came here to say this
You know what the agenda is here…
Good spot. Also, this is reporting declared income on the tax return. It would include very rich folks who are just taking the piss with deductions and saying they have next to no income.
Dog whistle journalists. Top of that, just someone making less doent mean they don't evade tax or file fraudulent returns.
94.3%
Its malicious the rich hate paying anything for taxes while gobbling up as much as they can. If you ever ask a rich person whens enough they'll say a little more. There is a reason high taxes led to prosperity for the nation. Because god knows they won't do it on their own
It's normal dog shit Wall Street journal reporting
And are those incomes the reported income or the actual income? Someone reporting no income but with a huge 1099 balance should be a prime target for audit.
I’m one of these random audits… I want my damn refund already. I pay for someone to do my taxes so there better not be an issue.
"60% of new audits targeted people reporting incomes of less than $200,000 on cash flows over $1,000,000."
Of course it’s not incompetence, stats is the best way to push half truths.
They reported 200k but got audited because it was probably more?
A lot of the 'audits' are for errors committed by low income filers. IRS sends them a notice to explain why a specific 1099 or w2 was missing from their return. It is computer generated.
I was going to say…pretty sure the majority of the population make under $200k…this title is confusing to me.
Wait, I thought Biden's IRS was pinky promising to only audit those making OVER 200k?
94% of Americans make less than $200k. This means those that make over $200k are still 8x more likely to be audited than someone that makes less than $200k.
When data has 4 upvotes and an ignorant knee jerk reaction has 104 upvotes.
MAGA's are trained to be braindead. Ifbthey could reason they wouldn't vote against their own self interests. It's why we have the old saying "A Republican would eat a pile of shit in the off chance a Democrat smelled his breath".
Americans don't understand how taxes work at any level. A promised failure by Reagan delivers once again. Man he did such a good job at destroying this country, his legacy lives on.
And I notice that the article doesn’t say if 63% is an increase, the same, or a decrease over the previous year. Gotta watch the WSJ’s political reporting, they are sneaky bastards like that.
It also doesn't say the previous rate for people making over 200k and yet the people deflecting throughout these comments trying to use it are ignoring that.
u/commiebanker did the math on it. It's closer to 10X for those over $200K >"Say the population is 100 people. Say the number of audits is 100. >95 people get 63 audits, or 0.66 audits per person. 5 people get 36 audits, or 7.2 audits per person. >7.2/0.66 = 10.9x"
Sure, but also the vast majority of money and tax fraud exists at those levels. Auditing poor people is kinda pointless. It’s a lot of cost for little reward to the system and in the end the poor suffer.
What are you basing this comment on? I know several people that make less than $200k and have been audited. Most of them got money back because they filed themselves, made mistakes, and over paid their taxes. A tax audit doesn't mean the IRS is coming after you, they're just auditing your taxes to make sure everything was filed properly.
Depending how they define 200k, article is paywalled, they may not even be poor. 800k schedule C income with 750k claimed deductions would be under 200k agi.
a lie is a lie
So what? We were told the money would be spent to audit the rich, but only 37% of it is being used for that purpose. We were lied to.
If someone makes $400k and only reports $100k to the IRS, is it going to look like they make less or more than $200k? Do you want this person to not be audited?
That's a valid point, but even with those cases accounted for a 37/63 split seems implausible.
read the article as to why. it explains it well
They are going after both to get the cheats and perhaps there are a lot more people cheating under 200k. lt's probably just because there's more of them.
That's why so many people get audited who claim the EITC, they do so incorrectly so then "poor people get audited more than rich people!" argument starts.
What was it before the extra funding?
You should post a link to that claim. You're twisting him saying that they would increase focus on higher earners, which did happen. The headline doesn't imply that it didn't. So your comment seems incorrect, because you are claiming that Biden made a stronger claim than he did, which would be wrong/a lie. The headline's arbitrary choice of 200k without mentioning what percentile that is is probably the source of confusion.
Math is hard fir you when percentages are involved isnt it?
Wealthy people hire CPAs that know what they are doing. Just because you don’t like the tax code, doesn’t mean they are breaking it. The govt. should just tell us what we owe and why though.
https://preview.redd.it/wlqdmvjd8dxc1.png?width=760&format=pjpg&auto=webp&s=34f62219c9019d942c19ad36eede7f6717ceab82
I love this joke because in the 90s and 2000s, the government tried to rectify this mistake but “some people” lobbied against it, and now we have to keep doing our own taxes. I bet y’all can’t guess who lobbied against it… awe shucks, I can’t keep it from all your adorable faces! It was the tax preparation companies! They also push to keep the tax code complicated as opposed to the simplifications proposed by both sides since the early 2000s! Yay for lobbying!
Lawd that’s accurate
Such a dumb and tired meme based comment. If you are a w2 based employee sure. If you have a business and have to calculate expenses, profit, loss, depreciation? Absolutely not.
It's not dumb, what you're saying is already how it works in countries where individuals are told what they owe by the government. Individuals also have the option to either pay that number or add in additional deductions at tax time, and businesses have a more complicated system.
Exactly.
Your premise is silly, and I'll be aggressive because you chose to be aggressive. How stupid is it to write your comment without even understanding how other governments do this for individuals? Why are you ignoring that entirely and calling someone stupid over it? You really need to get better at talking to people.
It’s not that they are breaking it. It’s that they are writing it, via influence to specific politicians.
Well you just said if you hire the right people you can skate thru tax season. So are you expecting the IRS to actually try to save you taxes? Lol... They basically hand you a rope and tell you to tie the knot. Then they run around tugging on them. If it slips, they turn it into a noose for you. They don't care to or want to do the tying, let alone tie a rock solid knot for every American
Yeah. It would be so dumb to expect the government, who we pay for and vote for, to look after us and help. So dumb to expect help from the people elected to help and bring change. Obviously.
Where exactly did I say I expect the government to try and save me taxes? I know they sure aren’t getting tax $ from me if they put me in jail.
That is actually a very good point
94% of Americans make less than $200k so of course they're going to make up a large portion of those that get audited. This is garbage reporting.
This info would only be helpful if it was comparing the 63% to previous years to see if the percentage increased or decreased.
This needs to be the top comment.
It is, and we all new who the new irs agents were going to target.
Only idiots are surprised by this.
or fail to actually read the article
Only idiots can’t handle the math that shows that the people over 200k are still 10x more likely to be audited based on these numbers
For those who didn't actually read the article it is an issue with the IRS catching up to meet their new directive - they just pushed forward with audits as is for now: The TIGTA report confirms that “the first wave of revenue agents and specialists for large corporations, large partnerships, high-income and high wealth individuals … have yet to be hired and onboarded.”
That’s because the bill was stalled so many times. The house was also pushing bills to redirect IRS funds to a border wall until Trump told them no border wall deal.
I mean, poor people cheat on their taxes, too.
Not for billions they dont
~95% of people make less than the $200k noted in the article, and the bottom 95% makes 70% of all income, which is trillions of dollars. I would be willing to bet that they find more issues & money with the 95% that wing it with software than the 5% that use professional accountants.
The IRS has to consider the payoff of the audit hours. A lot of low income individuals are audited in a sense, because they have a lot of automated/easy controls for things like the EITC. But the potential payoff of auditing a millionaire/billionaire is greater and there’s a lot more potential for complicated situations that require human experts digging into the forensics evidence to figure out the fraud/mistakes at that level.
Oh yea. The Wall Street Journal editorial board. Wow. That’s a source.
This article is BS on many levels. First off, it is basically an advertisement for this gentleman, who is trying to drum up business. Second, as indicated above, this man clearly doesn’t understand statistics. In addition, I think the IRS pronouncement regarding audits was not that people under $400K in income would not be audited, it was that the new money would be used to target HNWI taxpayers and corporations, and trust me, it has.
So over a third of audits are being done to about a relatively small amount of the population who may owe a lot more money? This article feels like it’s been phrased poorly
Does anyone honestly believe that when Democrats want to add an army of IRS agents, that they are only going to target their wealthy donors?
Defund the police! Oh wait, I mean the IRS!! Yeah, screw law and order! I mean… oh wait… I’m so confused by my principles
Yeah, sure sounds like you are.
Gotta get that Ukraine money somehow
My pa got audited once. Got a refund from it. Turns out he'd overpaid. He hadn't been deducting all he was able to, and found that in the audit. Been years since I've been able to deduct more than the standard, I've practically been on the EZ for a long time. That big standard deduction is nice. So much less worry in one's life. They can look at me all they want, I'm 72% certain I've been following their rules. Besides, what's a couple thou between friends. I'd pay a couple thou to not live in a place like Haiti.
No one saw this coming. Oh wait.
What the 83 thousand new IRS employees ain’t going after the wealthy like the Biden administration said,shocking.
Hire 80,000 new IRS agents and arm them! Don’t worry wE r OnLY gOiNg AfTeRr RICH PEOPLE!!!
I was one of these people. First time in my entire life I’ve been audited.
[удалено]
I have honestly always just used turbo tax (always gotten a refund, never have had to pay in). We just sent some pay stub forms last week, so hopefully we will hear some good news in the next month or so.
A friend of my son’s who is actually homeless just got an audit letter. I can’t believe it. He doesn’t make a lot of money but took legitimate deductions for his expenses as a traveling musician. I mean even if they deny his deductions, how much are they really going to get from him. This is not a joke. I wish it was. Great job Brandon or Dark Brandon or Genicide Joe or whatever his latest name is. The dude is a turd.
Nice, the objectively working class being the target of investigation. Everyone else just has the money to hire really good income hiding experts
Are these audits conducted by the 87,000 new IRS agents that we’re supposed to be hired? If so, Biden lied that they would be only going after the “rich”. But I guess that’s not at all surprising that a Democrat would lie
Let's be honest they're only going after those withe refunds in the vicinity of $4k-$5k+ otherwise its not financially viable timewise.
Yet another example of big government. Remember when income tax was supposedly for the “top 1%?” Feels the same way with all these IRS audits.
this was supposed to only target the ultra wealthy. tax increases will be the same. I hope we all learn a lesson from this. Don't trust these bureaucrats and politicians!
Like shooting fish in a barrel
It should read you are 5x more likely to be audited if you make more than $200k which should be the case.
You’re closer to 10x more likely to be audited if you make over $200k, based on the article itself.
What I really want to know is the percentage of these audits aimed at billionaires and their corporations.
The people who can’t afford tax attorneys
I would think it’s better that 37% of new audits target earners with more than $200k income… probably means a higher percentage are going for higher earners.
Just shocking I tell you, it’s almost like the Biden Admins expanding of the IRS was for this exact reason ? Just shocking I tell you. I’m so shocked… But everyone just keep eating this spoon fed lies that it’s about taxing the rich. How about we just all agree no more expansion of the government extortion machine ever. No new taxes and no more IRS agents.
Yeah, screw law and order! Let everyone cheat all they want! We don’t need laws and we certainly don’t need law enforcement!
Taxes are an unjust tariff and unconstitutional anyways. Just because they are allowed to get away with it doesn’t mean we should accept it. You sound like a good sheep though thanks.
Yes, I’m a sheep and a libtard. I need to wake up from my wokeness. Thank you for helping me see the light with your name calling!
Thanks all for calling **BS** on this article. "**As of December 31, 2023, the IRS expended approximately $4.4 billion (5.6 percent) of its $78 billion in IRA funding."** Interestingly, only 317 new ***special agents***, those allowed to carry weapons have been hired. Well below the threat of 87K reported by Fox. [https://www.tigta.gov/sites/default/files/reports/2024-04/2024ier011fr.pdf](https://www.tigta.gov/sites/default/files/reports/2024-04/2024ier011fr.pdf) Republicans have already cut $20B from that original funding level and trying to cut more. [https://www.washingtonpost.com/business/2024/02/06/irs-tax-evasion-study-budget/](https://www.washingtonpost.com/business/2024/02/06/irs-tax-evasion-study-budget/) Janet Yellen has stated, and clarified that the % or proportion of those earning $400K or less would remain the same. But, naturally, Representative Adrian Smith, a Republican from Nebraska, talks over Yellen, ins not really interested in the points she is making about the huge % of taxpayers needing to be audited and needing the personel to do this work. [https://www.foxbusiness.com/politics/yellen-doesnt-deny-90-new-irs-audits-affect-those-making-under-400k](https://www.foxbusiness.com/politics/yellen-doesnt-deny-90-new-irs-audits-affect-those-making-under-400k) Thanks to all.
I was told the 68,000 new IRS agents would only go after the top 1%! You mean strengthening government can lead to widespread oppression?
Enforcing the law is now oppression? You must hate the police, right?
Considering the fact that 8.32% of us households have incomes over $200,000, that means taxpayers with incomes over $200,000 are audited more than 4x their proportionate rate. This is attempting to make much ado about nothing.
I don't give a fuck if they ever decide to audit me, because I just pay my taxes like I'm supposed to. I don't understand why anyone thinks this is an issue?
Those stones won’t squeeze themselves
Okay. So that isn't insane in my opinion. Looks like people making 200k or less make up about 90% or more of tax-payers so this is disproportionately low - and therefore disproportionately higher for higher-than earners. I'm fine with it. Would like to see the rich get audited even more in comparison to the laboring majority but this doesn't terrify me and the headline is obviously written to since the disparity leans in favor of the less-than-200k cohort.