Everson Promises More Emphasis On Enforcement

by Leroy Baker, Tax-News.com, New York

11 May 2004

Internal Revenue Service Commissioner Mark W. Everson, has reaffirmed the government’s pledge to improve the agency’s enforcement record following a series of damning reports on its recent performance.

In a speech to the American Bar Association last Friday, Everson conceded that since a Congressional mandate in 1998, the agency’s focus had been on making improvements to customer service, to the detriment of maintaining staffing levels in the enforcement departments.

"What happened as we sought to fix the service side we dangerously moved down the enforcement side," the Commissioner observed.

He continued that wealthy taxpayers and corporations will be the Revenue’s primary target under the new programme, although tax-exempt and not-for-profit organisations can also expect increased scrutiny from the authorities.

Highlighting the Revenue's declining enforcement standards, a report published by the Treasury Inspector General for Taxation last month revealed that the IRS reviewed only one out of every 182 corporate tax returns in 2003, compared to one in 52 in 1997, representing a decline of 67%.

However, the IRS also attracted criticism for targeting taxpayers on relatively low incomes, leading Sen. Max Baucus, the ranking Democrat on the Senate Finance Committee to note: “Taxpayers making less than $25,000 a year are more likely to be audited than those making over $100,000.”

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