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Trends in IRS Collection and Enforcement

According to a report filed by the Treasury Inspector General for Tax Administration there has been a 19 % increase of enforcement personnel serving in the Collection and Examination function of the IRS since Fiscal Year 2006. Whereas on average overall IRS staffing increased 4 percent during this same period, from 103,811 employees in Fiscal Year 2006 to 107,622 employees at the end of Fiscal Year 2010.  So yes there appears to be a concerted effort to dedicate disproportionate resources to the collection and examination functions inside the IRS.

The Examination function’s recent increase in revenue agents and tax compliance officers resulted in the most tax returns examined over the past five years. The number of tax returns examined increased across the board for individual, corporate, and S Corporation tax returns in Fiscal Year 2010, while the number of partnership examinations decreased. As a direct result of this the number of delinquent tax accounts closed by full payment increased as did the amount collected on delinquent accounts. However, the IRS Collection function received more delinquent accounts than it closed, gross accounts receivable increased, and the number of tax delinquency investigations closed with the filing of a delinquent tax return decreased. In addition, while the number of taxpayers with delinquent accounts and delinquent returns in the Queue decreased, it was offset by an increase in the number of these cases that were shelved or surveyed.

Bottom line is that the situation is going to get worse before it gets better in my humble opinion.  Take heed and file/pay your taxes on time to avoid complications. No recommendations were made to the IRS based on this report. To view the report, including the scope and methodology, go to:

http://www.treas.gov/tigta/auditreports/2011reports/201130071fr.html

From → tax penalties