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WASHINGTON -- Despite the Internal Revenue Service's promise to bring new scrutiny to tax avoidance schemes used by the super rich, a new report finds that of the nearly 8,300 individuals recently reporting adjusted annual gross income of $10 million or more, as few as a dozen may have actually been audited by the special unit devoted to the task.
The report from the Transactional Records Access Clearinghouse (TRAC), a Syracuse University organization that monitors government performance, found that the IRS's Global High Wealth unit, announced to much fanfare in late 2009, completed audits of only 36 super-high-income returns in its first two and a half years. Because returns from more than one year may be considered, it's possible that as few as 12 individuals were audited.
TRAC co-director David Burnham said the IRS deserves credit for at having taken on the challenge, long before groups like Occupy Wall Street helped focus national attention on the super rich. But he said the agency just hasn't delivered.
One reason could be that the super rich have the system so fixed in their favor that the IRS is simply stymied, he said.
"Maybe this is great evidence that the tax code is so complicated, the IRS can't unravel the tax returns of these very wealthy individuals. Maybe they can't do it," Burnham said. "It's a great argument for trying to simplify the tax system."
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