[Arborealist]

They audit people who are eligible for EITC because they trivially know what most of them make / how much credit they qualify for and can have an algorithm tell them fraud is present with almost 100% accuracy.

If you want more handouts for the poor then vote for it. Don’t blame the IRS for enforcing the tax code. They should audit anyone and everyone fraudulently filing.

[poink]

I don't want "handouts for the poor" (well, I do, but I'm perfectly happy to legislate them). I _also_ don't want "I don't pay taxes, but I make over X, and the IRS only has an enforcement budget of Y, so I can probably just file a false return and not worry about it because they'll be busy with all the 'little people'" to be the calculus of people like the VCs who fund this site. They are absolutely that smart. They remind us constantly. People like them absolutely make this calculation all the time under the current regime.

[pclmulqdq]

People whose incomes are above a certain threshold are much more likely to be audited. There are just a lot more people who take the EITC.

[emrah]

Instead of fining mistakes/omissions which may be deliberste or unintentional, they should calculate, send out a bill and fine those who don't pay up.

[wahern]

That's basically what ends up happening. Over 40% of people don't respond to the initial audit notice, so what ends up happening is the adjustment is defaulted in the government's favor. See https://www.taxpayeradvocate.irs.gov/news/nta-blog-eitc-audi...

[dmoy]

that's literally what they do though?

I've (unintentionally) fucked up my taxes like a good 30% of the time because I didn't understand something or a broker literally just missed 25% of the transactions I made in the 1099 they sent me, or w/e.

Every time without fail, some 1-3 years later the IRS sends a CP-whatever saying "yea you done fucked up, you owe $X with $Y interest ($Y is inevitably really low), because of Z missing income from your form". And then I just log on and pay and sometimes I send them a reply letter with whatever missing document, and that's it. (Since they know all this, it would be nice if they could just preemptively send me a 1040 to sign anyways, but oh well)

One year they even sent me a check when I fucked up in the other direction. No interest though lol.

[ahi]

As a divorced parent with self-employed income my taxes can get complex. Years ago I screwed up, forgot a smaller 1099(?), IRS sent me a bill for what I owed + 8%. I stopped stressing since. I make best effort but a couple percent doesn't matter if your return is basically honest. It only hurts if you're being real "creatve"

[hedora]

They should also send refunds to people that overpay.

Also, people should be able to count their own time when calculating tax preparation costs.

[peter422]

So you are saying that in the majority of these cases the fraud is intentional and not accidental?

The point being the IRS can completely solve accidental mistakes but just telling everybody what they owe instead of forcing them to calculate it themselves.

[Gigachad]

I assume a fair bit would be people claiming deductions they aren’t actually entitled to like expenses for driving to work.

[mhalle]

I would assume that there is at least some constant personnel or time cost per audit that the IRS incurs. I would also assume that even with recently increased funding, the IRS only the capacity to audit a small sampling of the taxpayer base.

In that case, from a revenue recovery point of view, going after the highest income / highest discrepancy taxpayers produces the greatest return on investment, with some randomness involved to keep everyone on their toes.

[prepend]

There’s lots of “automated audits” where a letter is just generated and sent out.

It’s like being able to spam offenders of EITC to spend 25 cents to collect a few grand with a 99.99% collection rate. Versus spending hundreds of hours on a complex audit that may or may not yield any fines and has like 25/75 win rate.