1. Making a Fortune
We already said that the audit rates are generally low, but the chances of an IRS Audit increase substantially as your income increases too. Such as if you sell an expensive piece of property or receive a large payout from a retirement plan.
On top of that, the IRS has been criticized for overly scrutinizing low-income taxpayers who qualify for refundable tax credits while forgetting about wealthy taxpayers. As a consequence of this criticism, very wealthy Americans are once again in the sights of the IRS Audit.
And if President Biden has his way, more high-income individuals are likely to be audited. He intends to allocate billions of dollars for the IRS so the agency can take the necessary steps to go after large corporations, LLCs, and wealthy individuals. According to the Treasury Department, the president’s approach will not result in higher audit rates for taxpayers who earn less than $400,000.
Congressional Democrats want to give the IRS Audit $80 billion over a period of 10 years for its initiatives, but right now this bill is currently blocked in the Senate due to Democrats’ infighting.
We’re not suggesting you should try to make less money – I mean, everyone wants the exact opposite. Just keep in mind that the more money you make, the more likely is it for you to be on IRS’s radar.
