IRS Targeting of Service Center Audits
Low versus High Income Taxpayers

Individuals
Low
High
1992 2001 2003 1992 2001 2003
Audit Rate (%) 0.40 0.78 0.48 2.38 0.31 0.58
Ave. Tax Recommended $2,471 $2,577 $2,906 $4,569 $4,567 $10,528
Ave. Audit Hours *0.9 1.5 na *2.4 1.8 na
Number of Audits 171,864 325,441 169,955 74,566 29,086 63,328
Number of Returns Filed 43,183,245 41,716,770 35,631,532 3,131,801 9,326,250 10,841,260

Businesses (Schedule C)
Low
High
1992 2001 2003 1992 2001 2003
Audit Rate (%) 0.48 2.13 2.50 0.81 0.28 0.38
Ave. Tax Recommended $1,028 $1,723 $1,900 $3,667 $3,814 $3,892
Ave. Audit Hours *1.3 2.4 na *2.5 2.0 na
Number of Audits 10,207 54,316 68,165 12,743 5,556 7,827
Number of Returns Filed 2,139,507 2,553,280 2,721,912 1,579,644 2,012,210 2,084,855

*1993 figure since 1992 unavailable.
Note: Low income individuals have total positive income <$25,000 and file simple returns, while high income report $100,000 or more. Similarly Schedule C filers have <$25,000 (low) or $100,000 or more (high) total gross receipts.


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Copyright, 2002, 2004