Every fiscal year the Internal Revenue Service releases its own self-report called the “Data Book”. The IRS Data Book contains a range of tax data including service and enforcement changes. While there are indications that enforcement actions are down, perhaps due to a restriction in resources, no one should ever play Russian Roulette with their taxes.
We’ve pulled out the most interesting factual tidbits from the report…here they are:
- This year’s edition of the IRS Data Book marks 100 years since the Revenue Act of 1916 became law.
- The IRS helped more than 68 million taxpayers over the phone through both live assistance and automated services. This is an increase of almost 14.61% (no statistics are available as to how many people hung up in frustration, however).
- Taxpayers LOVED the IRS.gov website to the tune of 500 million unique visits. The most popular feature was the new “Where’s My Refund?” page which was used almost 300 million times (up more than 27%). Sounds like everyone checked on their refund twice.
- There were fewer enforcement actions taken during 2016. The IRS audited just over 1 million tax returns of individuals in 2016. This number was down almost 16% from the prior year’s total of 1.2 million. The number of individuals audited fell to 0.70%, the lowest coverage rate in more than a decade (don’t gamble with your taxes or you might need our help).
- In addition, several collection activities fell in 2016. IRS levies were down 40% compared to the prior year, and the agency filed almost 9 percent fewer liens than in the prior year.
As with all things financial, “past performance is no guarantee of future results”.
As we have seen in the past, the IRS could ramp up collection activities again in an effort to minimize the loss of revenue that tax cuts may bring. We have no idea how it will play out. Our recommendations are as always, to do the following:
- Always file your taxes even if you are not in a position to pay
- Never gamble with your taxes in the hopes that the IRS won’t “find out”. As we have seen recently, they have no problem going back several years to enforce collection.
- If you get into tax trouble with the IRS and you have a complex tax problem, seek out the advice of a qualified tax professional. Like professional counsel in other industries, their expertise can make a world of difference in your results.
More about the IRS Data Book: An electronic version of the 2016 IRS Data Book can be found on the Tax Stats page of IRS.gov. Printed copies of the 2016 IRS Data Book, Publication 55B, will be available May 2017 from the U.S. Government Printing Office. To obtain a copy, write to the Superintendent of Documents, P.O. Box 371954, Pittsburgh, PA 15250-7954, or call (202) 512-1800 for voicemail, or fax a request to (202) 512-2250.
*This article should be considered as a source of information only. Please consult a qualified tax professional before making any decisions about your taxes.