With tax season just around the corner, you might be wondering if you might be a target for an IRS audit next year. Even if you are confident that you paid your personal and business income taxes correctly, an audit can be very time-consuming and stressful. It’s something that no Atlanta taxpayer wants to deal with.
Fortunately, it appears that most people, even self-employed professionals, will not have to worry. The IRS has announced that it will focus its audit investigations on high-income households and big corporations in 2024.
IRA funds going toward new enforcement goals
The tax agency got a boost in funding as part of the Inflation Reduction Act of 2022. It plans to use that money to refocus attention on wealthy, high-income individuals and businesses, which have enjoyed lax tax law enforcement for several years. The IRS said it will not increase audit rates on people who earn less than $400,000 per year, which IRS Commissioner Danny Werfel said are already “historically low.” The agency will also work to protect those who claim the Earned Income Tax Credit, which is mostly claimed by those of modest income.
Instead, the IRA funds will mostly go to audit enforcement against wealthy individuals and companies. Artificial intelligence and other new technology will help IRS agents detect possible tax cheating and identify which cases are worth pursuing.
An audit is always possible
Whatever your income bracket has been in recent years, an IRS audit is still a possibility. If it happens, you will need to know what to do to defend yourself against an unfair tax bill. The assistance of an experienced tax attorney could be invaluable.