Did The IRS Really Hire 87,000 New Agents To Increase Audits On Small Businesses? The Real Story…
Did the IRS really hire 87,000 new agents for tax audits on small businesses?
There’s been a lot of chatter about the IRS in the last couple of years, about whether or not they’re hiring new agents with a target of auditing S CORPs and the middle class. Have you heard the rumors?
Like most things on the internet there’s some truth to it, but not all truth...
The short of it is this: Biden authorized $80 billion in funding for the IRS through 2031. A little over half of that (45 billion) is earmarked for “enforcement,” to help close the estimated $600 billion gap of what Americans owe, and what they actually pay.
As of last month the IRS announced they have 3,700 new jobs on their website. This is to “help expand compliance for large corporations and complex partnerships”. But did the IRS hire new agents for tax audits on small businesses like yours?
Some of their hiring efforts are for replacing agents that will be retiring. Their estimate is upwards of 50-80K will be retiring within 5 years or less, and will need to be replaced.
So if the IRS is hiring 87K more agents, that’s really just their status quo to do business as usual. And it’s over time, not right now.
I can see how people (looking at you, politicians) are loosely stating that they are hiring 87K agents with the target of “audits” for people who make under 70K a year.
The truth is that the IRS got way behind on 2021 taxes during COVID. There are typically a lot of errors on the submitted taxes they need to review, so this is business as usual.
Now, with this new bill “close the tax gap?” I am speculating that there will be an uptick in audits, and likely audits on business owners because of how many legal loopholes are in their favor.
I am also speculating that the threshold of 70K or S CORPs will be targeted. I’m thinking this mainly because this is the “earning demographic” that is widely unsupported with a good financial team or a tax attorney.
Here’s the chatter within the CPA communities. They are nervous and starting to pay more attention and care when submitting and reviewing taxes. This is, of course, because CPAs can also be legally liable.
Of course, it’s not uncommon for CPAs to be nervous. But I have seen some of us making some rather big changes “just in case”.
If you are worried about the status of your books or want a second opinion, never fear! I’m opening up a few spots on my calendar for business owners like you. So book a call with me here and we’ll chat!
My goal is to keep my clients as compliant as possible. Let me help you do this with confidence!
Book your call HERE!
Until next time,
Love, Light, and MONEY, Honey…
Kaylee