Your Money Minute The IRS Ghosts Rich Taxpayers 5/7/25
May 7, 2025
Discover how recent staff cuts at the IRS have dramatically decreased audits for wealthy taxpayers. This change is fueling a growing tax gap and raising concerns about lost revenue. The implications of reduced enforcement on the financial landscape are significant, reflecting the evolving challenges in tax compliance.
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IRS Cuts Halt Wealthy Audits
- The IRS has drastically cut enforcement staff, especially targeting wealthy taxpayers.
- This has led to a virtual halt in audits of wealthy Americans and large partnerships.
Former IRS Agent's Audit Loss
- A former IRS agent was working audits worth over $150 million before being fired.
- Those audits ended prematurely due to staffing shortages, leaving cases closed or silent.
Massive U.S. Tax Gap Expands
- The U.S. tax gap now exceeds $600 billion annually due to uncollected taxes.
- Reduced IRS enforcement especially worsens this shortfall, impacting government revenue.