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DC CURRENTS
Newly released IRS Data Book
numbers confirm decline in
audit rates
Author: Along with frustrating backlogs, describing a full range of IRS activities,
Robert M. Caplan, CPA declining audit rates have been the including returns, collections, refunds,
topic of many accountant discussions enforcement, and the IRS workforce.
regarding how IRS budget constraints The recent report covers the fiscal year
have affected taxpayers. The latest ending Sept. 30, 2021. This is the first
IRS statistics confirm the declining full tax year affected by COVID-19.
audit numbers. The first table, “Tax Year 2019 Audit
On May 26, 2022, the IRS released Rates Over Time,” shows IRS audit
its Data Book, 2021 (Publication 55- rates for tax year 2019 measured as of
B). The Data Book, published annually Sept. 30, 2021, and May 1, 2022. It in-
since 1863, contains statistical tables cludes the following types of audits:
A number of factors Tax year 2019 audit rates over time
have led to a decline
in IRS examinations Tax year 2019 audit Tax year 2019
audit rate as
over the past few Total positive income (TPI) ranges rate in Data Book: of May 1, 2022
Sept. 30, 2021
years, and a dearth Returns with EITC 0.8% 0.8%
of IRS examiners No TPI 0.8% 1.1%
could cause that TPI $1–$25,000 0.4% 0.4%
trend to continue. TPI $25,000–$50,000 0.2% 0.2%
TPI $50,000–$75,000 0.1% 0.2%
TPI $75,000–$100,000 0.1% 0.2%
TPI $100,000–$200,000 0.1% 0.2%
TPI $200,000–$500,000 0.1% 0.2%
TPI $500,000–$1 million 0.3% 0.6%
TPI $1 million–$5 million 0.6% 1.3%
TPI $5 million–$10 million 1.0% 2.0% PHOTO BY CELSODINIZ/ISTOCK/THINKSTOCK
TPI >$10 million 2.0% 8.7%
Source: IRS, Data Book, 2021, Table 17, as referenced in IRS statement,
“Updated IRS Audit Numbers” (May 26, 2022).
44 October 2022 The Tax Adviser
