IRS announces plan to increase audits of wealthy individuals
According to IRS Large Business and International (LB&I) division commissioner Douglas O’Donnell, the IRS are taking heightened action to examine high-income individuals’ tax affairs as soon as the current suspension of investigations and collections ends on July 15, 2020.
Historically, the tax returns of high net worth individuals escaped IRS audit where the return encompassed a variety of complex subject areas, since individual IRS audit teams were not equipped to audit areas that partly involved a topic of specialism of another division.
Now, due to an increased use of data analytics, the IRS’ ability to connect disjointed divisions is becoming increasingly advanced and the IRS are now starting to take an enterprise approach to data.
The IRS has announced a plan to bolster audit activities and has “identified over 1,000 cases or 1,000 private foundations that have linkages or that are interwoven into these global high-wealth enterprises”.
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