Washington (March 16, 2004) -- The number of audits of high-income taxpayers jumped 24 percent in 2003, outpacing the increase of taxpayer audits across the board, according to the latest statistics from the Internal Revenue Service.

IRS 2003 enforcement statistics show that audits of high-income taxpayers (adjusted gross income over $100,000) reached 139,379, up 24 percent over 2002, and up 52 percent from 2001. Meanwhile, audits of all taxpayers rose 14 percent to 849,296, while revenue from IRS collection activity grew to $35.5 billion, a jump of 9 percent from 2002.

"Our 2003 enforcement results show that we have arrested the decline in enforcement actions that began in the early 1990s and worsened after implementation of the IRS Reform Act of 1998," said IRS Commissioner Mark W. Everson. The IRS noted that major collection tools --levies, liens and seizures -- also increased, but aren't yet at their pre-1998 levels.

Commenting on the audit rates, Senate Finance Committee chair Chuck Grassley said, "We need to focus beyond just the numbers and make sure the IRS is auditing smarter. Unfortunately, today's numbers don't show the trend of the increasing number of audits that find nothing wrong. Those 'no-change' audits mean that honest taxpayers could be put through the wringer for no reason. That's why the IRS should focus its limited resources on tax cheats."

-- WebCPA staff


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