Niles Elber Comments on IRS Shifting Focus to HNW Individuals and Partnerships
The Internal Revenue Service has made a number of recent moves signaling its resolve to shift its focus to the wealthy and away from working-class taxpayers. It intends to use Inflation Reduction Act funding to further its "major expansion in high-income/high wealth and partnership compliance work."
. . .
"The announcement is built on the IRA funding for the service and the money that has not yet been clawed back by Congress," said Niles Elber, a Member in the Washington, D.C., office of Caplin & Drysdale. "You cannot ignore the fact that the Republican side of Congress is making it a priority to pull that money, so all the plans are under that could. They're aiming at large partnerships, high-net-worth individuals with assets, FBAR issues. None of these are new, and we've been dealing with them for some time. Enforcement is a product of having the resources to go after taxpayers they don't believe are paying their taxes."
"They still theoretically have $65 billion and change, and that's a fair amount of money," he added. "When there were calls to increase the debt limit, one of the things they had to give up was enforcement. That was at least $10 billion. Every time they negotiate, Republicans - at least on the House side - say we need to restrict spending."
The Democrats may have to give a little on how far they will go, according to Elber. "What the IRS is saying is that they're bringing in an additional number - 3,700 - of revenue agents who will do examinations. It won't replace all the people who have left the IRS recently, but it makes some progress toward that, so it's a worthy effort. It's important that taxpayers and the professionals doing compliance work understand that the IRS is building back up in this area in the hope that they will pay appropriate attention."
For the full article, please visit Accounting Today’s website (subscription required).